Why the deduction can look brutal

The next pound of overtime can land in a higher income-tax band, trigger more National Insurance, hit student-loan deductions, and sometimes interact with Child Benefit or the Personal Allowance taper. That is why the overtime net can feel disproportionately small.

The useful question

The better question is not “is overtime taxed differently?” but “how much of this extra pay do I actually keep?” That answer depends on where the extra pay lands in your overall annual position.

Best next page

Use Bonus, Pay Rise and Overtime Calculator to model the extra income rather than your full annual salary.