Is a 5% pay rise good? What it is worth after tax
The short answer: a 5% pay rise is good if inflation is lower than 5%, because you can then buy more than before. You also keep less than 5% in your pocket. On £35,000 the rise is £1,750 before tax and about £1,260 after.
What 5% is worth in pounds
| Salary | New salary | Extra gross | Extra take-home |
|---|---|---|---|
| £25,000 | £26,250 | £1,250 a year | £900 a year |
| £35,000 | £36,750 | £1,750 a year | £1,260 a year |
| £50,000 | £52,500 | £2,500 a year | £1,488 a year |
| £70,000 | £73,500 | £3,500 a year | £2,030 a year |
On £25,000 you keep about 72% of the rise. On £70,000 you keep about 58%.
Against inflation
What matters is the real change: how much more you can buy. A 5% rise against different rates of inflation:
| If prices rose | Your real pay change |
|---|---|
| 2% | +2.9% |
| 3% | +1.9% |
| 4% | +1.0% |
For the current rate of inflation, check the latest figures from the Office for National Statistics. If it is below 5% your pay has grown in real terms.
When 5% is not enough
- If you have had a promotion, new duties or longer hours, a standard rise may undersell you.
- If you are on the national living wage, a higher statutory rate may beat 5%.
- If a rise pushes you over £50,270, only the part above is taxed at 40%. See how income tax bands work.
Other percentage rises on £35,000
| Rise | New salary | Extra gross | Extra take-home |
|---|---|---|---|
| 2% | £35,700 | £700 | £504 |
| 3% | £36,050 | £1,050 | £756 |
| 4% | £36,400 | £1,400 | £1,008 |
| 5% | £36,750 | £1,750 | £1,260 |
| 6% | £37,100 | £2,100 | £1,512 |
| 8% | £37,800 | £2,800 | £2,016 |
| 10% | £38,500 | £3,500 | £2,520 |
How to compare it with the job market
A rise only tells you what you are paid relative to last year. To judge whether you are paid fairly, compare against advertised pay for your role and region, your employer’s pay bands if they publish them, and what a move to another employer would offer. Public sector pay, such as NHS and teaching, is set by pay review bodies, so a settled percentage applies to everyone on the scale.
How to ask for more than the standard rise
- Collect evidence: results, extra duties and what the role is advertised at elsewhere.
- Ask for a specific figure in pounds, not a vague request for more.
- Choose the moment: before pay budgets are set, not after.
- If the answer is no, ask what it would take, and when you can review it again.
Non-pay alternatives
If the employer can’t move on salary, consider extra holiday, flexible hours, training, or a higher pension contribution. A pension contribution through salary sacrifice avoids tax and National Insurance, so every £1 costs you less than £1 of take-home pay. See the pension calculator.
This is general information. Figures are for 2026/27 in England, Wales and Northern Ireland.
Common questions
Is a 5% pay rise good?
It depends on inflation. A 5% rise beats inflation if prices rose by less than 5%, so it is a real increase. If prices rose by 5% or more, you have only kept pace.
How much is a 5% pay rise after tax?
Roughly 58p to 72p of each extra pound, because tax and National Insurance take a share. Basic-rate taxpayers keep about 72p and higher-rate taxpayers about 58p.
How do I work out a pay rise in pounds?
Multiply your salary by 0.05 for 5%, then add it to your salary. On £30,000 that is £1,500, so £31,500.
What is the average UK pay rise?
Pay settlements vary by sector and year. Check recent figures from the Office for National Statistics before comparing yours.
Can I ask for more than 5%?
Yes. Raises above the standard cost-of-living award are normally based on your performance, market pay for the role, and any increase in your responsibilities.