Be honest. When did you last properly look at your payslip?
Hey,
Welcome to Beyond The Payslip. A newsletter for people in their 20s and 30s who are done pretending they've got this whole money thing figured out.
Each week, I'll break down one financial topic that actually matters to your life right now. No jargon. No condescension. No trying to sell you anything.
Let's start with something that sits in your inbox every month, which most people glance at for about 4 seconds before closing.
Your payslip.
The number everyone looks at (and the ones nobody does)
You open your payslip. You check one number. Your net pay, the thing that hits your bank account. Then you close it.
Sound familiar?
The problem is that the gap between what your employer pays for you and what actually lands in your account is enormous, and most people have no idea where it goes or whether the numbers are even right.
So let's fix that.
The anatomy of a UK payslip
Gross pay: This is your full salary before anything is taken off. If you earn £60,000 a year, your monthly gross is £5,000. This is the number your employer agreed to pay you. Enjoy it, because it's all downhill from here.
Income tax: The big one. The UK uses a progressive tax system, meaning different portions of your income are taxed at different rates. For 2025/26:
- First £12,570 at 0% (your Personal Allowance)
- £12,571 to £50,270 at 20% (Basic Rate)
- £50,271 to £125,140 at 40% (Higher Rate)
- Above £125,140 at 45% (Additional Rate)
So if you earn £60,000, you're not paying 40% on all of it. Just the slice above £50,270. Your effective tax rate is lower than your marginal rate. This trips people up constantly.
National Insurance (NI): Think of this as a second income tax that nobody talks about. In 2025/26 you pay 8% on earnings between £12,570 and £50,270, and 2% above that. It funds the NHS and state pension, which is nice, though you won't feel nice about it on payday.
Pension contribution: If you're auto-enrolled (and you should be), a percentage of your salary goes straight into your pension before you see it. The minimum is 5% from you, with your employer adding at least 3% on top. This is genuinely free money. More on that in a future issue.
Student loan repayments: If you graduated after 1998, you're likely on Plan 2, which means you repay 9% of everything you earn above £27,295 automatically through payroll. You never see it, you never choose to pay it, it just disappears. On a £60,000 salary that's over £2,400 a year quietly leaving your account. Worth knowing it's there, and worth knowing what plan you're on, because Plan 1, Plan 2, Plan 4 and Plan 5 all have different thresholds. Check yours at gov.uk/repaying-your-student-loan.
Benefits in kind: This one surprises people. If your employer provides perks like private health insurance, a company car or a gym membership, HMRC often treats these as taxable income even though you never see the cash. They show up on your payslip as a benefit in kind and increase your taxable pay accordingly. So if you're wondering why your tax looks slightly higher than expected, your private healthcare might be the culprit.
Your net pay: What's left. The number you actually care about.
One thing worth checking right now
Pull up your last payslip and check your tax code. It'll be something like 1257L. That L means you're getting the standard Personal Allowance of £12,570.
If your code looks different, say 1057L, or BR, or W1, it could mean HMRC has adjusted your allowance for a reason and it might not be right. A wrong tax code means you could be overpaying tax every single month.
You can check your tax code at gov.uk/check-income-tax.
Takes five minutes. Could be worth hundreds.
Next week
We're talking emergency funds. How much you actually need, where to keep it, and why your current savings account is probably working against you.
Until then,
BeyondThePayslip
Not a financial adviser. Just someone who thinks more people should understand this stuff.