The 60% tax trap between £100,000 and £125,140
Updated 9 November 2026 · Rates checked against the official sources below
Once your income goes over £100,000 you lose £1 of your £12,570 personal allowance for every £2 you earn. Between £100,000 and £125,140 that makes the effective income tax rate 60%, plus 2% National Insurance.
What you keep
| Salary | Take-home per year | Tax and NI |
|---|---|---|
| £100,000 | £68,557.40 | £31,442.60 |
| £110,000 | £72,357.40 | £37,642.60 |
| £125,140 | £78,110.60 | £47,029.40 |
Going from £100,000 to £110,000 adds only £3,800.00 to your take-home pay: 38p in every pound.
Why it happens
On each extra £2 you pay 40% income tax (80p), and losing £1 of personal allowance means another £1 is taxed at 40% (40p). That's £1.20 on £2, or 60%.
Reducing the effect
Pension contributions (including salary sacrifice) and Gift Aid donations reduce the income used for this test, so they can bring you back under £100,000. Childcare support such as Tax-Free Childcare also stops at £100,000, so the impact can be bigger for parents. Get qualified advice for your circumstances.
Sources
General information, not tax or legal advice. Rules can change; check gov.uk or ask a conveyancer, accountant or Acas before you rely on it.