What is Gross Income? UK Definition 2026/27
Quick Answer
Your total income before any tax deductions or allowances.
Definition of Gross Income
Gross income is your total income from all sources before tax, National Insurance, pension contributions, and other deductions. It includes salary, bonuses, benefits-in-kind, self-employment profits, rental income, investment income, and pension income. Your tax liability is calculated on gross income minus allowable deductions and reliefs.
Gross Income — Key Facts for 2026/27
| Includes | All income sources |
| Before | Tax and deductions |
| Used for | Tax calculation, mortgage |
| vs Net income | Gross is always higher |
How Gross Income Works — Example
- 1Gross salary: £50,000
- 2Employer pension contribution: £2,500 (not in gross)
- 3Employee pension: £2,500
- 4Taxable gross: £47,500
- 5After tax and NI: ~£37,500 net
How Gross Income Affects Your Tax
Gross income determines your tax band and affects eligibility for allowances like child benefit HICBC and Personal Allowance taper. Reducing gross income through pension contributions can provide significant tax benefits.
Official HMRC Guidance on Gross Income
For official guidance, refer to HMRC's documentation. Tax rules can change, so always verify current rates and thresholds on gov.uk.
HMRC: Income TaxFrequently Asked Questions about Gross Income
Related Tax Terms
Accuracy Note
This information is for guidance only and is based on 2026/27 tax year rates. Tax rules are complex and your circumstances may differ. For personal advice, consult a qualified accountant or tax adviser.