You put your salary into a calculator, then your first payslip arrives and the number is different. Usually nothing is wrong. Calculators work from standard assumptions, and your payslip reflects your personal details.
The usual causes
A calculator cannot know everything about you. These are the most common reasons for a gap:
- Your tax code or withholding form is different from the standard one, because of past underpayment, a second job or an allowance you claimed.
- Your employer deducts something the calculator did not include, such as health cover, union fees, a workplace giving scheme or a cycle-to-work arrangement.
- Pension or retirement contributions at a different percentage from the one you entered.
- A student loan plan or other repayment that applies to you.
- The pay period: the calculator shows the amount for the period you choose, and a month with five weekly pay days or a two-week cycle changes the picture.
Part-year effects
If you start a job part-way through a tax year, your first payslips can be taxed using temporary or emergency codes until the tax office confirms your details. These are often corrected later, with a refund or an adjustment. Likewise, in some systems a bonus or an extra payment is taxed using a flat withholding rate that can be higher than your real rate, and any difference is settled at the end of the year.
Regional differences
In the United States, state and sometimes local taxes vary widely. Our state pages cover state income tax for all 50 states and DC, but cities and counties may add their own taxes, and some states have separate disability or family-leave deductions. Check your payslip for lines like these. In the UK, Scotland has its own income tax bands, which our calculator lets you choose.
How to close the gap
Start with your payslip. List each deduction and check it against the estimate. Anything on the payslip that the calculator does not know about is an extra, and subtracting it from the estimate usually explains the difference. If the tax line itself is different, check your tax code or withholding form with your employer or the tax authority.
What an estimate is good for
An estimate is for planning, not for settling a dispute. It is very good at comparing options, such as two jobs, a raise or different pension percentages, because the same assumptions apply to both sides of the comparison. It is less good at predicting the penny. Treat it as a close guide and use your payslip as the final word.
When to ask for help
If the difference is large and you cannot explain it, ask your payroll department for a breakdown, or contact the tax authority. For complicated situations such as self-employment, several jobs or living in two countries, a qualified tax adviser can look at your full picture. Our figures are estimates and are not tax advice.
Calculators for this guide
More tips
- How to Read a Payslip, Line by Line
- Hourly, Weekly, Monthly or Yearly: Converting Pay Without Mistakes
- Marginal and Effective Tax Rates: Why a Pay Rise Never Costs You Money
- Retirement Contributions and Take-Home Pay: Before Tax or After?
- How to Compare Two Job Offers Properly
- Bonuses and Overtime: Why They Seem to Be Taxed More
- How to Build a Budget From Your Take-Home Pay
- States With No Income Tax: What That Does and Does Not Mean
- Moving for a Job: Will You Really Be Better Off?
- Self-Employed? How Much Should You Set Aside for Tax
- Asking for a Raise: Using Take-Home Numbers to Plan the Conversation
- Student Loan Repayments and Your Take-Home Pay
- A Yearly Tax Check-Up in Thirty Minutes
- All tips and guides
These guides are general information and estimates to help you plan. They are not tax advice. Rules and rates change, so check the official tax authority for your country.