Overtime Calculator 2026/27
Overtime is taxed as regular employment income at your marginal rate: 28% for basic-rate taxpayers (20% tax plus 8% NI) or 42% for higher-rate (40% plus 2%). Take-home per overtime hour depends on your base salary, not just the rate. Enter salary, hours and rate below.
Figures verified against HMRC PAYE & NI rates on .
Written by James HartleyCIMA
Calculator
Your full-time gross salary (used to calculate your hourly rate and marginal tax rate).
Number of overtime hours worked.
Check your employment contract for your agreed overtime rate.
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How Overtime Calculator 2026/27 Works
We first calculate your standard hourly rate by dividing your annual salary by 1,950 hours (37.5 hrs/week × 52 weeks). Your overtime hourly rate is then this multiplied by your chosen overtime rate (e.g. 1.5 for time-and-a-half).
Marginal tax calculation
We calculate tax and NI on your base salary, then again on base salary plus gross overtime. The difference is the tax attributable to your overtime. This gives a precise figure rather than using a flat estimated rate.
Important note on weekly hours
If your contracted hours differ from 37.5/week, your actual hourly rate will differ. Adjust your base salary proportionally if needed, or contact us to request a custom hours feature.
Frequently Asked Questions
No - overtime is taxed as regular employment income under PAYE. However, because it's on top of your salary, it's taxed at your marginal rate. If your salary already exceeds £50,270, every pound of overtime is taxed at 42% (40% income tax + 2% NI). This is why overtime can feel heavily taxed.
This calculator uses the standard 37.5-hour working week (52 weeks per year = 1,950 hours). Your hourly rate = Annual Salary / 1,950. Some employers use different hours - check your contract. The National Living Wage for workers aged 21+ is £12.21/hour for 2026/27.
There is no statutory right to overtime pay unless your contract specifies it. However, your average hourly pay across all hours worked (including overtime) must not fall below the National Minimum/Living Wage. Many employment contracts specify 1.5x or double time for overtime, but this is a contractual right, not a legal requirement.
If you work overtime at your regular workplace, normal commuting costs are not tax-deductible. However, if overtime requires travel to a temporary workplace, or if you incur additional costs specifically due to overtime (such as late-night taxis home that your employer doesn't reimburse), you may be able to claim tax relief via self assessment.
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Official Rates Used
This calculator uses official HMRC rates for 2026/27. View the current rates at GOV.UK:
Rates last verified:
Disclaimer: This calculator provides estimates based on standard HMRC rates for 2026/27. Results may vary based on individual circumstances. This is not financial advice. Always consult a qualified accountant or CIMA-qualified financial adviser for personal tax matters.