2026/27 · England · Employment income

Household tax gap

The UK taxes individuals, not households. Enter two salaries and see how much less the household keeps than it would if the same total were split the way the system rewards most.

Example figures. Replace with yours.

Partner 1 salary

Partner 2 salary

Children under 16

Married or in a civil partnership
Applies Marriage Allowance where it is available. Household pays for childcare
Counts Tax-Free Childcare and funded hours for working parents.

Assumptions you can change

Value of a funded hour (£)

Funded hours are in kind, so they are priced at what a nursery would charge. Rates vary by region.

Income growth per year (%)

Brings the published data to 2026/27 for percentiles: three years for HMRC, two for DWP. ONS reports total pay growth of 4.1% in April to June 2026.

Household position at every possible split

Your split Best split Hover or touch the line to read any split.

The best split is a benchmark. Employment salary cannot be reassigned between partners, so this is not advice. It shows what a system that taxed households as a unit would deliver.

What is modelled

Income tax and employee National Insurance for England, Wales and Northern Ireland. Personal Allowance £12,570, tapered by £1 for every £2 above £100,000. Higher rate from £50,270, additional rate from £125,140.
Child Benefit of £27.05 a week for the eldest child and £17.90 for each other child, for children under 16. The High Income Child Benefit Charge falls on the higher earner alone, from £60,000 to £80,000. The government dropped its plan to assess it on household income.
Tax-Free Childcare: £2,000 a year for each child under 12, assuming enough childcare is bought to claim it in full. Funded working-parent hours: 30 a week for 38 weeks for ages 1 and 2, and the extra 15 hours for age 3.
Both partners must earn at least 16 hours a week at the National Living Wage (£12.71, about £10,575 a year) and neither may have adjusted net income above £100,000. One partner crossing either line removes all childcare support for the household.
Percentiles: each salary is ranked among UK income taxpayers using HMRC's Survey of Personal Incomes for 2023/24, which leaves out people below the tax threshold. The household is ranked on after-tax income (pay plus Child Benefit less the charge, excluding childcare support) divided by an equivalence scale, against DWP's Households Below Average Income for 2024/25. The scale is 0.67 for the first adult, 0.33 for the second, 0.20 for a child under 14 and 0.33 for a child aged 14 or 15. DWP publishes percentiles 4 to 97 only. Both sources are uprated at the growth rate under assumptions.
Left out: pension contributions, student loans, Scotland, savings and dividends, self-employment, and benefits other than Child Benefit.

Rates checked against GOV.UK and HMRC publications: income tax, Child Benefit charge, Tax-Free Childcare. Percentile data: HMRC percentile points, DWP Households Below Average Income.