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The marginal rate applies to your next pound of income; the effective rate is total tax divided by total income. Because the lower bands are taxed at lower rates, the effective rate is always below the marginal one.

Because they change every year and differ by country, state and sometimes city. A hard-coded schedule is wrong for most readers within a year of being written, and wrong quietly, which is worse.

No. Only the income above the threshold is taxed at the higher rate, so more gross pay always means more net pay. Cliff-edge losses come from benefit withdrawal, not from the tax bands themselves.

Anything charged as a flat percentage of pay — social security, national insurance, pension contributions, health levies. They are grouped here because they compound with income tax to set your real marginal rate.

Payroll applies your specific tax code, mid-year adjustments, salary sacrifice arrangements, student loan thresholds and benefit-in-kind charges. This is an estimate from the numbers you enter, not a reconstruction of your payroll record.

In many schemes yes — contributions taken before tax reduce the amount assessed, so the real cost of contributing is less than the amount contributed. Whether yours works that way depends on the scheme and the country.

Cumulative tax systems adjust as the year progresses, so a bonus, a change of tax code, a benefit-in-kind or a mid-year raise all shift the monthly deduction. Some months correct for earlier ones.

A code telling payroll how much tax-free allowance to apply. A wrong code is the most common cause of over- or under-payment, and it is worth checking against your tax authority's record whenever your circumstances change.

Typically calculated on income above a threshold and deducted through payroll alongside tax. The threshold and percentage are set by the loan plan, and having more than one plan means more than one deduction.

Contributions taken before tax reduce assessable income, so the take-home cost of contributing is less than the amount contributed. With an employer match, opting out is usually the most expensive decision on a payslip.

A non-cash benefit — company car, private medical cover, subsidised loan — that is generally taxed as if it were income. It often appears as an adjustment to the tax code rather than as a line on the payslip.

Because only the income above each threshold is taxed at that band's rate. Someone in a 40% band pays 40% on part of their income and less on the rest, so the overall effective rate is always lower.