Incremental PAYE & Employee NIC Calculation
Overtime is taxed on top of your existing base salary. The calculator determines the additional Income Tax and Class 1 employee NIC (8%/2%) caused specifically by the overtime hours.
Overtime Take-Home Pay Estimator
Calculates gross overtime, incremental tax/NIC deductions, and net take-home
Incremental Overtime Breakdown Result
Gross Overtime Pay
£450.00
£30.00/hrExtra Tax + NIC Deductions
-£126.00
28.0% DeductionEstimated Net Overtime
£324.00
Take-Home| Total Estimated Annual Earnings (Salary + Overtime) | £40,450.00 |
| Additional Income Tax Caused by Overtime | -£90.00 |
| Additional Employee National Insurance (Class 1) | -£36.00 |
| NET TAKE-HOME OVERTIME PAY | £324.00 |
UK Overtime Statutory Rules Summary
| Overtime Rule | Statutory & Contractual Guidance |
|---|---|
| Statutory Rate Multiplier | No mandatory 1.5x or 2.0x law exists. Rates depend on employment contract. |
| National Minimum Wage Floor | Total earnings divided by total hours worked must equal or exceed NMW rates. |
| PAYE Tax Bands | Overtime is taxed at marginal rate (20%, 40%, 45%) based on total annual earnings. |
| Pension Auto-Enrolment | Overtime is included in qualifying earnings for workplace pension calculations. |
Frequently Asked Questions (6 Detailed FAQs)
Overtime is treated as regular taxable employment income subject to PAYE Income Tax and employee National Insurance. The additional tax depends on where the overtime falls within your overall marginal tax position.
No. Income Tax is charged in bands. Overtime only attracts higher-rate (40%) tax on the portion of taxable income that exceeds the £50,270 higher-rate threshold.
No. There is no statutory requirement for employers to pay 1.5x or 2x overtime rates. Overtime rates are contractual, provided overall hourly pay meets National Minimum Wage.
Yes, if your employer operates a salary sacrifice arrangement, sacrificing overtime into a pension can save both Income Tax and employee National Insurance.
Yes. Qualifying earnings for auto-enrolment workplace pensions include gross wages, salary, overtime, bonuses, and commission.
This calculator gives an annualised estimate. Real payroll operates on weekly or monthly pay periods, student loan status, tax codes (e.g. 1257L), and benefit deductions.
Official GOV.UK Sources
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Overtime Multiplier Reference
Time & a Quarter1.25x Rate
Time & a Half1.50x Rate
Double Time2.00x Rate
Minimum Wage ProtectionMandatory NMW Floor