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      How much of our pay goes to the Government?

      Lesson details

      Learning outcome

      I can explain what information can be found on a payslip and how much of our pay goes to the Government.

      Key learning points

      1. A portion of our earnings is deducted by the Government for taxes like Income Tax and National Insurance.
      2. The amount of government deductions is shown to us on our payslip. This will show other deducations too such as pension.
      3. Income Tax is a progressive tax whereas National Insurance is a regressive tax.

      Keywords

      • Tax - the charges imposed by the Government on citizens and corporations to finance some of its spending

      • Income Tax - a compulsory tax on earnings from employment collected by the Government to fund public services

      • National Insurance - contributions paid from money earned to enable individuals to qualify for certain benefits and the State Pension

      Common misconception

      Everyone pays the same rate of tax regardless of their salary.

      The UK operates a progressive taxation system so people pay more if they earn more, according to the Government's band system.

      Teacher tip

      Using some examples of payslips from people on a range of salaries who qualify for different tax bands, do some group work analysing how much pay the Government took. For example, have pupils match the tax band with the payslip.

      Content guidance

      Depiction or discussion of sensitive content

      Supervision

      Adult supervision recommended

      Licence

      This content is © Oak National Academy Limited (2025), licensed on Open Government Licence version 3.0
      except where otherwise stated. See Oak's terms & conditions
      (Collection 2).

      Lesson video

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      Prior knowledge starter quiz

      6 Questions

      Q1.
      Fill in blank: Financial involves making informed decisions about budgeting, saving and avoiding debt.

      Correct Answer: responsibility

      Q2.
      What is the purpose of a savings account?

      to spend money quickly
      Correct answer: to store money for future use
      to pay off credit card bills

      Q3.
      What is a budget?

      a list of all the things you want to buy
      a type of bank account
      Correct answer: a plan for spending money

      Q4.
      Fill in the blank: A debit card allows you to spend directly from your bank account, while a card lets you repay money later.

      Correct answer: credit
      business
      loyalty
      prepaid

      Q5.
      Match the word to the correct definition.

      Correct Answer:ethical,doing what is morally right, fair and good
      Correct Answer:borrow,taking money from a lender with the intention of paying it back
      Correct Answer:overdraft,when you spend more money than you have from your bank account
      Correct Answer:invest,putting money into something with the aim of making a profit

      Q6.
      Fill in the blank: is deception for financial gain, often through scams that steal money or personal information.

      Correct Answer: fraud

      6 Questions

      Q1.
      Match each word to its correct definition.

      Correct Answer:Income Tax,charges on employment earnings collected for public services
      Correct Answer:tax,charges imposed by the Government on citizens and corporations
      Correct Answer:National Insurance,contributions paid for people to qualify for certain benefits

      Q2.
      Fill in the blank: All deductions, such as taxes, are taken from your before you are paid.

      Correct Answer: salary, pay

      Q3.
      Which is not included on a payslip aside?

      gross pay
      net pay
      Correct answer: partial pay

      Q4.
      National Insurance is calculated on earning above what amount?

      £5,520
      Correct answer: £12,570
      £35,620
      £50,270

      Q5.
      Fill in the blank: A is a long-term savings plan that provides you with an income after you retire.

      Correct Answer: pension

      Q6.
      What kind of taxation system does the UK operate, according to the Government's band system?

      aggregated
      Correct answer: progressive
      universal

      To help you plan your 10 citizenship lesson on: How much of our pay goes to the Government?, download all teaching resources for free and adapt to suit your pupils' needs...