Pay & work guides
How overtime affects take-home pay
Overtime increases your gross pay. The extra money that reaches your bank account depends on the deductions that apply to that payment.
Start with the gross overtime amount
Multiply your overtime hours by your normal hourly rate and the agreed overtime multiplier. Check the rate with your employer: time and a half is an example, not an automatic entitlement.
10 hours at time and a half
10 hours × £18.50 × 1.5 = £277.50 before deductions.
If your payslip already gives the gross overtime amount, use that amount instead. Do not add it again through the hours calculation.
Why you may take home less than £277.50
Income Tax and employee National Insurance can reduce the extra payment. Pension contributions, student loan repayments and other deductions can also affect what you keep. Your tax code and pay circumstances matter; there is no single overtime take-home percentage for everyone.
A simplified 2026/27 illustration
Assume the whole £277.50 falls within a 20% Income Tax band and the 8% employee NI band, with no pension, loan or other deductions changing:
- Income Tax: £277.50 × 20% = £55.50
- Employee NI: £277.50 × 8% = £22.20
- Extra take-home: £277.50 − £55.50 − £22.20 = £199.80
This illustrates those assumed marginal rates, not a complete payroll calculation. A payment crossing a threshold, a different NI category or Scottish Income Tax bands can give a different answer. See HMRC’s 2026/27 payroll rates and thresholds.
Does crossing a tax band mean all my pay is taxed more?
Income Tax bands apply to slices of taxable income. Moving into a higher band does not make that higher rate apply to every pound you earn. Allowance reductions or changes to benefits can complicate the overall effect at some income levels. Check GOV.UK’s Income Tax bands and allowances for the applicable rules.
One busy month or a regular commitment?
For overtime expected on your next payday, use Pay Predictor and add it in the Changes step. Check your payroll cut-off so you include it in the payment that will actually contain it.
For overtime you expect throughout the year, use the Annual Calculator’s overtime section and select its repeating frequency. One unusually busy payslip should not become a full year of regular overtime by accident.
Check whether the extra hours are worth it
Compare the extra take-home with the hours you give up and any extra travel, food or childcare costs. Saving both a normal-pay scenario and an overtime scenario makes that difference easier to see.
Rate example checked 12 September 2026 for tax year 2026/27. Overtime arrangements: GOV.UK overtime guidance. Examples are planning illustrations; check actual deductions with payroll.