How Much of Your Pay Should Go on Bills? A UK Guide

There is no single right answer to how much of your pay should go on bills, because the biggest bills, rent and council tax, vary so much from one part of the UK to another. A better question is what share of your own pay goes on bills, and whether what is left covers everything else. You can work that out in about fifteen minutes.

Step 1: Use your take-home pay

Start with the amount that actually lands in your account each month, after tax, National Insurance and any pension contributions. That is the money your bills come out of. If your pay changes from month to month, use the average of your last three payslips.

Citizens Advice suggests gathering your payslips, bank statements, and card statements or bills before working out a budget. Have them in front of you for the next step.

Step 2: Add up every bill

List everything you pay regularly to run your home and your life:

• rent or mortgage
• council tax
• gas and electricity
• water
• broadband and phone
• insurance
• TV licence
• subscriptions you would keep even in a tight month

For bills that are not monthly, use one twelfth of the yearly cost. GOV.UK lists a TV licence at £180 a year, which is £15 a month.

Council tax needs care too. GOV.UK says it is usually paid in 10 monthly payments. To compare it with your monthly pay, take the yearly total and divide by 12.

Step 3: Divide

Divide your monthly bills by your monthly take-home pay, then multiply by 100. That is your bills percentage.

Here is a worked example, with made-up amounts:

	Monthly
Take-home pay	£2,000
Rent	£750
Council tax (yearly £1,500 ÷ 12)	£125
Gas and electric	£95
Water	£40
Broadband and phone	£45
TV licence (£180 ÷ 12)	£15
Phone contract and subscriptions	£40
Bills total	£1,110

£1,110 divided by £2,000 is 0.555, so bills take about 56% of this person’s pay, leaving £890 for food, travel, savings and everything else.

For a sense of scale on one bill: Ofgem says the price cap for a typical household paying for gas and electricity by direct debit is £1,723 a year from 1 October 2026, which is about £144 a month. Your own usage may be higher or lower.

Step 4: Check what is left

The percentage on its own does not tell you much. What matters is whether the money left after bills covers the rest of your month. Write down your usual spending on:

• food and household shopping
• travel to work
• savings, even a small amount
• debt repayments
• a little for yourself

If all of that fits into what is left, your bills are at a level your pay can carry. If it does not, something has to give, and bills are often the easiest place to start because they repeat every month.

A word on the 50/30/20 rule

You may have seen the 50/30/20 rule of thumb, which splits take-home pay into needs, wants and savings. It is a useful starting point, but it was never designed around UK rents. In the example above, bills alone take 56% of pay before any food. If your rent is close to half your take-home pay, aim for your own target instead, and focus on the money left over.

If your bills take too much of your pay

A few places to look first:

1. Council tax discounts. If you live alone, GOV.UK says you get 25% off. Our council tax guide covers who qualifies and how to apply.
2. Out-of-contract deals. Broadband, phone and energy tariffs can be worth comparing once a year. Our annual bill review walks through it.
3. Bills you no longer use. Subscriptions and memberships are easy to forget once they are on autopay.
4. The order your bills come out. If money runs short before payday, moving collection dates can help even when the total stays the same. See broke before payday.

If you are already behind on bills, start with our guide to which bills to pay first, and contact Citizens Advice for free help.

Keep the number in view

Your bills percentage changes whenever a price goes up, a deal ends or your pay changes. Recalculate it each April, when council tax bills arrive, and whenever your pay changes. A bill tracker like Billo shows what is due before payday and what is left after bills, once you add your pay and your payday, which keeps the number in front of you every month.

Want to see your own numbers? Try our free what’s left after bills calculator. It runs in your browser and nothing you type is saved or sent.