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Threshold Wise

2026/27 tax year · England, Wales and Northern Ireland

How Gift Aid feeds into adjusted net income

Gift Aid is not only about the charity reclaiming tax. The same donations reduce adjusted net income, which is the figure tested against £100,000 for the personal allowance taper and for childcare support.

Grossed-up, not just what left your account

Under Gift Aid you donate a sum and the charity reclaims basic-rate tax on top. For adjusted net income, HMRC looks at that larger “gross” value. Dividing what you paid by 0.8 is the usual way to get there when basic rate is 20%.

Example shape: a £800 donation from your bank becomes a £1,000 gross deduction for adjusted net income. The calculator does that gross-up when you enter £800 in the Gift Aid field.

Where it sits in the £100,000 picture

Adjusted net income is built from taxable income, then reduced by things like grossed-up Gift Aid and certain pension contributions. A lower ANI can mean less personal allowance withdrawn in the taper band, or remaining on the eligible side of the childcare cliff at £100,000.

Gift Aid does not rewrite your salary. It changes the measured income for those tests. The adjusted net income guide shows the full order of steps; this page is only the donation piece.

What counts as Gift Aid here

Enter donations to UK charities where Gift Aid applies and the charity can reclaim basic-rate tax. Sponsored events, church envelopes, and online donations with Gift Aid ticked are the usual cases. Ordinary spending that is not a Gift Aid donation does not belong in this box.

Use the total for the tax year you are modelling (2026/27 runs 6 April 2026 to 5 April 2027), not a rolling twelve months that cross the April boundary unless that matches how you are working the rest of the figures.

Add Gift Aid the way you paid it

Figures update as you type. There is nothing to submit.

Your figures never leave your browser. Payslips are read on your device — not uploaded, not sent to an AI. The calculation runs here too. Nothing you type is stored, logged, or passed to analytics.

Where do you pay income tax?

Scottish income tax rates and bands differ and are not covered by this tool.

How do you want to enter your pay?

Drop a payslip to fill year-to-date figures, or enter amounts yourself below. The rest of the calculator appears once you confirm.

Use figures from a payslip

Drop a file below, check the figures, then apply. Or type year-to-date totals by hand.

Drop a payslip or P60 here

or click to choose a file

PDF preferred; a clear photo works too. Read on your device only — never uploaded. One month’s slip is enough to project the year and check the £100,000 line.

Figures are extracted in your browser (text layer or on-device OCR). The file is never sent to us, never passed to an AI provider, and is gone when you close this tab.

Choose how to enter your pay above to see your figures.

Enter figures yourself, or drop a payslip. The rest of the form appears once you confirm.

Alongside pensions and sacrifice

People often stack Gift Aid with pension contributions. The mechanisms differ: salary sacrifice never puts the sacrificed pay into income; relief-at-source pensions and Gift Aid both use a gross-up idea but for different payments. Enter each in its own field so the working stays auditable.

Limits of this page

  • It does not tell you how much to donate.
  • It does not claim higher-rate relief for you through Self Assessment.
  • It does not replace HMRC’s Gift Aid declaration rules or charity paperwork.

Confirm material donations against your records and GOV.UK Gift Aid guidance.

Common questions

Do Gift Aid donations reduce adjusted net income?
Yes. For adjusted net income, qualifying Gift Aid donations are deducted on a grossed-up basis: what you paid, extended by basic-rate tax. That lower adjusted net income is what is tested against £100,000 for the personal allowance taper and for Tax-Free Childcare / funded hours.
What figure do I enter — what I paid or the gross amount?
Enter what you donated from your own pocket (the net payment). The calculator grosses it up using the same basic-rate factor HMRC uses (0.8 as the divisor), so you do not have to do that step by hand.
Is Gift Aid the same as a pension contribution?
No. Both can reduce adjusted net income, but they work through different rules. Pension contributions depend on whether the scheme is salary sacrifice, net pay, or relief at source. Gift Aid is a separate deduction for donations where the charity can reclaim basic-rate tax.
Does Gift Aid reduce the income tax on my payslip?
Not by itself in the same way PAYE does. Gift Aid mainly affects how HMRC measures adjusted net income and how much basic-rate tax the charity reclaims. Your employer does not usually rewrite your tax code for every donation you make.
What if I am a higher-rate taxpayer?
Higher-rate (or additional-rate) relief on Gift Aid is claimed through Self Assessment or by asking HMRC to adjust your tax code. This calculator still uses the grossed-up donation for adjusted net income. It does not prepare a Self Assessment return.