How to compare two job offers properly — beyond the headline salary
Most people compare job offers on gross salary. That figure tells you almost nothing about what you'll actually take home or what the offer is worth over five years. The true comparison requires looking at six things together.
1. Net monthly take-home
Two offers with the same gross salary can produce meaningfully different take-home pay. Pension contribution rates, student loan plans, salary sacrifice, and car allowance all affect the net figure. The does this calculation side-by-side for both offers with a single input.
2. Employer pension contribution — the most undervalued benefit
An employer contributing 8% of a £50,000 salary is giving you £4,000/year directly into your pension. An employer contributing 3% is giving you £1,500/year. That £2,500 difference is real compensation that never appears in gross salary comparisons. Compound that over 10 years at 5% growth and it's worth roughly £32,000 in your pension pot.
3. Bonus — reliability matters more than headline figure
A £10,000 bonus paid consistently is worth including. A £10,000 'target' bonus where actual payment varies from 0 to 150% of target is worth much less in planning terms. Ask about the history of bonus payments — how often is full bonus paid, what drives it, and has the scheme changed recently?
4. Car allowance vs company car
A car allowance is taxable as income — a £5,000 allowance adds to your gross pay and is taxed at your marginal rate. A company car is also taxable (as a Benefit-in-Kind, based on list price × emissions percentage) — but the amount depends on the car. For an efficient electric vehicle, the BIK rate is 2-3%, making it genuinely cheap. For a large diesel company car, the BIK can exceed the value of a cash allowance.
5. Private healthcare, life insurance, income protection
These benefits have real cash value. Private medical insurance for a family can cost £1,500–2,500/year on the open market. Life insurance at 4× salary for a 35-year-old is worth something. Income protection that pays 60% of salary if you're unable to work is particularly valuable. These don't show in gross salary but are real compensation.
6. The £100k threshold — watch both sides
If either offer crosses the £100,000 adjusted income line, the Personal Allowance starts tapering, creating a 60% effective marginal rate up to £125,140. An offer of £110,000 may be significantly less attractive than it appears. Read the before making any decision in this range.
Use the to get the true net monthly figures for both offers at once.
Why gross salary is the wrong comparison
Two offers with identical gross salaries can produce meaningfully different take-home pay. Pension contribution rates, student loan plans, salary sacrifice arrangements, and taxable benefits all affect the net figure. The Job Offer Comparison Calculator handles this side-by-side for both offers with a single input — compare it with the gross salary and the gap often surprises people.
The six elements that determine true offer value
1. Net monthly take-home
Always the first calculation. Use the Take-Home Pay Calculator for each offer to see the after-tax, after-NI, after-pension figure. This is what you actually live on.
2. Employer pension contribution
The most undervalued element. An employer contributing 8% of a £50,000 salary adds £4,000/year to your pension — compounded over 10 years at 5% growth, that's worth approximately £50,000 extra in your retirement pot. An employer contributing 3% is worth £15,000/year less in lifetime value. Two otherwise identical offers with different pension matches are not the same offer.
3. Bonus — reliability matters more than headline
A £10,000 bonus paid consistently is worth including in your comparison. A £10,000 "target" bonus where actual payment varies from 0 to 150% of target is worth far less in planning terms. Ask specifically: what percentage of the workforce received full bonus in each of the last three years? The answer reveals how realistic the headline figure is.
4. Car allowance vs company car
A car allowance is taxable income — a £5,000 allowance adds to gross pay and is taxed at your marginal rate. A company car is also taxable as a Benefit-in-Kind, based on the car's list price multiplied by an emissions percentage. For a small electric vehicle (BIK rate 2–3%), the tax is negligible. For a large diesel (BIK up to 37%), the tax cost can exceed the value of an equivalent cash allowance. Model the specific car before deciding which is better.
5. Private benefits: the hidden compensation
6. The £100,000 threshold — check both sides
If either offer takes adjusted income above £100,000, the Personal Allowance begins tapering, creating a 60% effective marginal rate up to £125,140. An offer of £105,000 may be significantly less attractive than £95,000 with a larger pension match. Read the 100k Tax Trap guide before making any decision in this range.