UK £100k Tax Trap Calculator

When your income exceeds £100,000, your personal allowance (£12,570) is reduced by £1 for every £2 of income above £100,000. The allowance is fully withdrawn at £125,140. This creates an effective marginal rate of 62% in England, Wales and Northern Ireland on income in this zone.

The headline figure is 60% (40% income tax + 20% effective rate from PA loss). Adding 2% employee National Insurance gives 62% on each extra pound earned. Some sources say '60% trap' ignoring NI, but 62% is the full marginal rate for employees.

Yes — the personal allowance is set UK-wide. In Scotland the Advanced rate (45%) typically applies in this zone for 2026-27, giving an effective marginal rate of 45% + 22.5% PA-loss + 2% NI = 69.5%.

Yes. By sacrificing enough into a workplace pension to bring your taxable income to £100,000, you avoid the trap entirely. For example, a £115,000 earner can sacrifice £15,000/year (£1,250/month) into pension to escape, saving roughly £9,300/year in tax + NI while building £15,000 of pension.

Both work, but they apply differently. Workplace salary sacrifice reduces gross pay before income tax and NI, so saves the full marginal rate plus 2% NI. Personal pension contributions and Gift Aid extend your basic-rate band by the gross-up amount, recovering 40% (or 45%) tax via your tax return — they don't save NI. Salary sacrifice is usually the most efficient.

You leave the 60% trap and your personal allowance is gone. The marginal rate drops to 47% in E&W (45% additional rate + 2% NI) or 50% in Scotland (48% top rate + 2% NI). Counter-intuitively, the rate falls when you earn more.