Gross salary
Pay before income tax and employee contributions are taken out. Calculators start from gross salary because every tax rule is expressed against it.
How taxable income is calculatedReference
Tax glossary
The terms used in the calculators and guides, defined plainly. Each entry links to the page where the rule is applied.
Pay and income
4Net pay (take-home pay)
The amount left after income tax and payroll contributions such as National Insurance, FICA or social insurance. It is gross salary minus total deductions.
Open a country calculatorTaxable income
The slice of income that tax is actually charged on: gross income minus allowances, standard deductions and pre-tax contributions such as a 401(k) or pension.
How taxable income is calculatedWithholding tax
Tax deducted at source by an employer or payer and sent to the tax authority on your behalf. A payslip usually shows withholding rather than a final annual assessment.
How the calculators workRates and bands
4Tax band (tax bracket)
A range of income taxed at a single rate. Only the income inside each band is taxed at that band’s rate, so a higher band never applies to the whole salary.
How income tax is calculatedMarginal tax rate
The rate charged on the next unit of income — the band your top slice falls into. It is always at least as high as your effective rate.
Marginal versus effective rateEffective tax rate
Total tax divided by gross income, expressed as a percentage. It shows the average burden across all bands and is always lower than the marginal rate.
Marginal versus effective rateProgressive tax
A system where higher slices of income are taxed at higher rates. All five countries covered here use progressive bands for salary income.
How income tax is calculatedAllowances and reliefs
5Standard deduction
A fixed amount subtracted from income before tax, used instead of itemised deductions. India and the US both apply one; the amount depends on the tax year and filing status.
How taxable income is calculatedPersonal allowance
The UK’s tax-free allowance on income. It is reduced by £1 for every £2 of income above £100,000 and reaches zero at £125,140.
The UK personal allowance taperTax rebate
A reduction in the tax owed rather than in taxable income. India’s Section 87A rebate can reduce tax to zero below the threshold, with marginal relief just above it.
India 87A rebate and marginal reliefSurcharge
An extra percentage charged on top of income tax above a set income level. Pakistan applied a 9% surcharge above PKR 10 million in 2025-26 and abolished it for 2026-27.
Pakistan surcharge explainedCess
A levy calculated on the tax itself, not on income. India adds a 4% health and education cess after rebate and surcharge.
India tax slabsPayroll contributions
2National Insurance (NI)
The UK employee contribution charged on earnings above a threshold, at 8% up to the upper earnings limit and 2% above it. It is separate from income tax.
UK take-home pay guideFICA
US Social Security and Medicare contributions: 6.2% on earnings up to the Social Security wage base and 1.45% for Medicare, plus 0.9% above the additional Medicare threshold.
US federal income tax bracketsDates and filing
1Tax year
The 12-month period a tax return covers. Pakistan runs 1 July to 30 June, India 1 April to 31 March, the UK 6 April to 5 April, and the US and China use the calendar year.
Tax year dates around the worldPut the definitions to work
Every calculator applies these terms to real tax bands and shows the full breakdown.