I have two questions

  • In this rent affordability calculator, is the "Applicant Minimum Salary" referring to salary AFTER taxes? If yes, then it all makes sense. I don't need an answer for question 2.

  • If it's the salary BEFORE taxes, I find the calculation quite dubious all things considered. Given that taxes for a high bracket income eat roughly 45% of the salary, for an overall gross salary of 60k you're basically only going to earn around 35k after taxes and national insurance, which amounts to 3k per month. So: how is it feasible to have a rent of 2k on a salary fo 3k/month? This doesn't even include council tax (+1k) and utilities. Is the calculator completely and utterly off, or am I misinterpreting it?

  • 1
    How did you figure that 45% overall tax rate on 60K figure? Seems suspect to me. Commented Oct 10, 2021 at 12:20
  • 3
    On a gross salary of £60k you should be taking home £43,400 after tax and NI, not £35k.
    – Vicky
    Commented Oct 10, 2021 at 13:17
  • 4
    Yes it does include NI. (I used moneysavingexpert.com/tax-calculator which clearly shows what it is accounting for). On gross £60k, assuming no other income and no other deductions such as pension contribution or private health insurance, the monthly net is £3,624.
    – Vicky
    Commented Oct 10, 2021 at 13:25
  • 2
    To be pedantic Natiional Insurance is insurance, not a tax. To be more practical, NI is never included in any calculation of "take home pay" or definition of "salary" or "wages" in the UK, since it is paid directly by the employer, not by the employee.
    – alephzero
    Commented Oct 10, 2021 at 20:50
  • 3
    @alephzero are you in the UK?! There are two parts to NI, employer and employee contributions, and the employee contributions absolutely are shown on the payslip as deductions and included in calculations of take home pay.
    – Vicky
    Commented Oct 11, 2021 at 7:38

2 Answers 2


Despite the name ("Tenant Affordability Calculator") that particular site is geared more towards landlords and property managers than tenants, and I would interpret the table in the light of "if you are a landlord seeking this much rent, this is minimum salary you should require your tenants to have", which is very different from "if you are a tenant on a certain salary, this is the amount of rent that would be affordable for you".

I expect it is gross, although note also that they want to insist on a guarantor with a minimum salary as well.

I think you would be better off finding a budget calculator that takes into account all those factors (tax and NI, council tax, utilities, food and household costs etc) in order to determine how much rent you can afford to pay.

I will note though, that in 2021/22 a gross salary of £60k translates to take home pay of approx £43,500 (factoring in tax and NI) which is substantially more than the £35k you quote. Is it possible you are not factoring in pension contributions or other things that reduce your take-home?

  • Thanks for the answer. I think the 43.5k is suspect based on the payslip (showing only relevant parts) but my friend might be getting taxed too much
    – nz_21
    Commented Oct 10, 2021 at 13:36
  • @nz_21 Is it possible the rate for tax withheld by the employer is overestimating the tax that would be due on filing? e.g. the job was started late in the year, with a significant signing bonus paid - - which may have required the employer to withhold tax based on an artificially higher projected annual gross income? Might result in an income tax refund on filing. Commented Oct 10, 2021 at 15:07
  • @ChrisW.Rea Interesting, I'll clarify with my employer Monday morning. My friend did get taxed on the signing bonus though, so not sure why it's factoring in into the monthly salary taxes
    – nz_21
    Commented Oct 10, 2021 at 16:22
  • 2
    @nz_21 As Chris mentioned, HMRC can tax via PAYE based on some sort of annual income projection, which may be skewed by the signing bonus. It is also worth checking your friend is not on a emergency tax code, which often leads to PAYE taking a large sum in the first few months of a new role. This is often reconciled at the end of the tax year - either HMRC will give you an automatic refund, or your friend will need to fill in a P800, Simple Assessment or Self Assessment.
    – B.Liu
    Commented Oct 10, 2021 at 22:28
  • 3
    @nz_21 (Obligatory not a tax professional) Moreover, given your friend's payslip excerpt, which shows a standard work income scenario, a £60k salary (nor £75k incl bonus) should not attract a 42% effective tax rate. In 2021/22 you do get a 42% marginal tax + NI rate on the last £10k, but as general rule of thumb the first £9.5k-ish of income is tax free (personal allowance), then the next £3k-ish is 12% (NI), and then the next £37.5k is 32% (Standard Tax band + NI). This should yield a total tax and NI contributions of around £16.5k, which is consistent to the result posted by Vicky.
    – B.Liu
    Commented Oct 10, 2021 at 22:51

You don't need to take these expenses into account explicitly to formulate a guideline as they are typically going to be roughly proportional to the rent. The same goes for income taxes and insurance contributions: They are lower than you suspect and can be estimated based on the income. So it's perfectly reasonable to guess what's affordable based solely on a person's gross salary.

The fact remains however that 2k/month is 40% of a salary of 60k/year (that is: before taking taxes and insurance contributions into account). This is much higher than any personal finance recommendation I know. It's even higher than common rule-of-thumbs for landlords so you are right that this calculator does not seem very useful.

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