How to Calculate Your Take-Home Pay After Tax in 2026 (US, UK, Canada)

Knowing how to calculate your take-home pay after tax is essential whether you are negotiating a salary, comparing job offers, or budgeting for the year. Your gross salary — the headline number on the offer letter — is never what lands in your bank account. The gap is taxes and deductions, and it varies a lot by country.

Gross pay vs net pay

Gross pay is your total salary before anything is removed. Net pay — your take-home pay — is what remains after taxes and deductions. In most countries the gap is 20–35% of gross. Always budget on net pay, never gross.

United States: the deductions stack

In the US, several layers come out of each paycheck.

Federal income tax is progressive — different slices of income are taxed at rising rates. You do not pay your top rate on your whole salary, only on the portion inside that bracket.

FICA is a flat payroll tax: 6.2% for Social Security (up to an annual wage cap) and 1.45% for Medicare, totalling 7.65% on most income.

State income tax varies enormously. Some states (Texas, Florida, Washington and others) have no state income tax; others charge up to ~13% at high incomes. This single factor can swing your take-home pay by thousands.

Pre-tax deductions — 401(k) contributions, health insurance premiums — reduce your taxable income, lowering the tax you pay while still leaving the workplace.

United Kingdom: PAYE, NI and the personal allowance

The UK collects tax through PAYE (Pay As You Earn), straight from your payslip.

You get a personal allowance — a slice of income taxed at 0%. Above it, income tax runs through basic, higher and additional rate bands.

National Insurance is the UK's equivalent of payroll tax, charged above a threshold.

UK earners also typically see pension auto-enrolment contributions and, if applicable, student loan repayments deducted automatically.

Canada: federal plus provincial

Canada stacks federal income tax and provincial/territorial income tax — and provincial rates differ widely, so where you live changes your net pay.

On top of income tax, employees pay CPP (Canada Pension Plan) and EI (Employment Insurance) contributions, both with annual maximums. A basic personal amount shields the first slice of income from federal tax.

Why the same salary pays differently

A $100,000 salary does not produce the same take-home pay across these countries — or even within them. The drivers:

• Where you live — US state, Canadian province, or UK-wide rates.
• Pre-tax contributions — pension or 401(k) money lowers taxable income.
• Filing status and credits — marital status, dependants and tax credits all shift the result.
• The wage caps — Social Security, CPP and NI thresholds change the marginal deduction at higher incomes.

This is why "negotiate on net, not gross" matters when comparing offers in different locations.

A simple way to estimate it

To rough out your take-home pay:

1. Start with gross annual salary.
2. Subtract pre-tax deductions (pension, health premiums) to get taxable income.
3. Apply income tax band by band — never your top rate on the whole amount.
4. Subtract payroll tax (FICA / NI / CPP + EI).
5. Subtract state or provincial tax where it applies.
6. What remains is your annual net pay; divide by 12 for monthly take-home.

Frequently asked questions

What is take-home pay? Take-home pay (net pay) is what you actually receive after income tax, payroll tax and deductions are removed from your gross salary.

Why is my paycheck so much smaller than my salary? Income tax, payroll tax (FICA, NI or CPP/EI), and deductions like health insurance and retirement contributions all come out before you are paid.

Do 401(k) or pension contributions reduce my tax? Yes — pre-tax retirement contributions lower your taxable income, so you pay less tax while still saving.

Which US states have no income tax? Several, including Texas, Florida and Washington. Living in one meaningfully increases your take-home pay.

How do I compare two job offers in different places? Convert each gross salary to net pay using the local tax rules, then compare the net figures — the gross numbers can be misleading.

Calculate your real take-home pay

Skip the manual band-by-band math. The free Salary Calculator estimates your net pay with tax brackets for the US, UK, Canada and other countries — so you can see exactly what a salary is worth before you accept the offer.