The £100,000 Tax TrapCalculator·{{TAX_YEAR}}
CALCULATOR · TAX YEAR {{TAX_YEAR}} · ENGLAND · WALES · N. IRELAND

Why every pound above £100,000 costs you 60p in tax.

Between £100,000 and £125,140 of adjusted net income, the UK personal allowance tapers away and the effective marginal tax rate reaches ~62%. Combined with the High Income Child Benefit Charge and the £100,000 childcare cliff, a pay rise can leave a family poorer. Model your position below.

Enter your salary to see your exact position →

£ per year

Your marginal rate in the £100k–£125,140 band. Income tax + lost personal allowance + NI, combined.

Model your full position See the worked examples
TL;DR

The UK Personal Allowance (£12,570) is reduced by £1 for every £2 of adjusted net income above £100,000, fully withdrawn at £125,140. Inside that band the effective marginal rate is ~62% — income tax, NI, and lost allowance combined. Add HICBC (£60k–£80k) and the £100,000 childcare cliff, and a raise can leave a household worse off.

Taper threshold
£100,000
Taper rate
£1 lost per £2
Allowance fully gone at
£125,140
Marginal rate in band
~62% inc. 2% NI
Tax year
{{TAX_YEAR}}
Scope
England · Wales · N. Ireland

Source: GOV.UK — Income Tax

Worked examples · What the next £1 actually keeps
Adjusted net incomeMarginal rate on next £1Next £1 keeps
£99,00042%58p
£100,001–£125,140~62%~38p
£125,141+47%53p

The 62% figure is 40% income tax + 20% from the lost personal allowance + 2% employee NI. Below £100,000 or above £125,140, marginal rates drop back.

Model your exact numbers below ↓

1
Income from your job
Allowances, bonus and stock income on top of your salary
All figures are yearly unless marked otherwise.
e.g. 20% of a £100k salary = £20k bonus.
Estimate the taxable value of shares you expect to vest this tax year. This can be difficult to estimate — your HR or payslip can help.
2
Taxable work benefits
These add taxable value to your income (BIK)
Original list price including extras, before discounts.
A salary sacrifice car reduces your gross salary but adds a taxable benefit. Electric cars have the lowest rates and tend to be most effective at reducing your income. Hybrid rates are higher.
Leave blank if you’re not sure yet — we’ll estimate the cost needed to reach your target.
The car’s original list price including extras. An estimate is fine — we’ve pre-filled a typical value.
Usually around £1,000–£2,000 per year. Check your P11D if unsure.
E.g. life insurance, gym membership, interest-free loans, or other benefits shown on your P11D.
3
Pension & salary reductions
Reduces your taxable income
Enter your contribution from your payslip. This is often taken before tax. We model this as salary sacrifice, which also reduces your National Insurance. If your scheme uses a ‘net pay’ arrangement instead, your NI figures may differ slightly.

If you enter a monthly amount, we annualise it across 12 months for planning.

Applied to your base salary by default.
Advanced: change pension basis →
Net amount you pay in. We'll calculate the full tax relief automatically.
e.g. cycle to work, childcare vouchers (legacy schemes).
4
Other income
Other taxable income — rough estimates are fine
Revenue minus allowable expenses.
Do not include dividends or savings interest (these are taxed differently).
5
Other details
Extra details for take-home and threshold checks
Most people have 1257L. If yours is different, enter it here.
Net amount donated — we'll calculate the full tax relief automatically.
Used to calculate the High Income Child Benefit Charge (HICBC) between £60,000 and £80,000 ANI.
30 funded hours + Tax-Free Childcare are lost above £100k ANI. Value of funded hours differs by region.
Enables the childcare-support loss calculation above and adds a safety buffer below £100k to the recommended target.
Breaching £100k can cost you up to £9,500 per child per year in lost childcare support.
Only counts children using Tax-Free Childcare or 30 funded hours — typically under school age.

Your results

Summary of your position and recommended action

See how your figures are calculated
Adjusted net income
Total income£0
+ Company benefits (BIK)£0
− Salary sacrifice deductions£0
− Personal pension (tax relief applied)£0
− Gift Aid donations (tax relief applied)£0
= Adjusted net income£0
Personal allowance
Standard allowance£12,570
− Reduction due to high income£0
= Remaining allowance£12,570
Deductions & take-home
Income tax£0
National Insurance£0
Student loan£0
Salary sacrifice (taken before tax)£0
Personal pension (paid after tax)£0
Gift Aid donations (paid from income)£0
= Estimated take-home£0
≈ Monthly£0
Based on UK {{TAX_YEAR}} tax rules and your inputs above.
Why this matters

The only chart in UK tax where earning more makes you poorer.

Between £100,000 and £144,000 a family with two children in nursery can earn an extra £44,000 of salary and still take home less than they did before. The dip is real. The chart is real. Most people in it have no idea.

£60k £80k £100k £125k £160k gross salary → Childcare cliff £19,000 drop. Instant. You break even again £144,000 gross — an extra £44,500 62% marginal rate → spendable income (take-home + nursery subsidies)

Household shown: two children in nursery, England, standard tax code. Without nursery-age kids the £100,000 step disappears, but the 62% drag from £100k to £125,140 remains.

You, on this chart

Enter a salary above to see where you sit.

Until you type a figure, this is all someone else’s problem.

How much of a £10,000 raise reaches your pocket
The other half of the story

For parents, £100,000 isn’t a tax rate. It’s a switch.

The chart above is the tax-rate story. There’s a second cliff at £100,000 that has nothing to do with tax rates — and for parents of nursery-age children, it’s usually the bigger number.

Take Priya. She earns £99,000, her partner earns £45,000, and they have two children in nursery. Today, two government schemes cover most of the cost: 30 funded hours per week per child during term time, plus Tax-Free Childcare adding £2 for every £8 she pays on top, up to £2,000 per child per year.

Her employer offers a £4,000 raise. On paper, she earns more. In practice, both schemes turn off the moment her adjusted net income crosses £100,000. Not gradually. Not tapered. On the first pound over.

Nursery invoice — annual
Two children · full-time nursery · 38 school weeks + 11 holiday weeks
Eligible for childcare support
Full nursery fees (2 children) £32,400
− 30 funded hours (term-time, per child) −£11,280
− Tax-Free Childcare top-up (£2 per £8, capped £2,000/child) −£4,000
Amount due from family £17,120
Change vs baseline —
Both schemes key off adjusted net income. Stay under £100,000 on that measure and you keep both in full.

The £4,000 raise unlocks a £15,280 childcare bill that wasn’t there yesterday. The 62% marginal rate on the raise itself adds to the damage — but it’s a footnote next to the lost subsidies.

The fix is mechanical. A £4,000 pension sacrifice brings adjusted net income back under £100,000 and flips both schemes back on in full. Same raise, routed through a different lever. The nursery place comes back. Your numbers will differ — but the mechanism is the same for anyone in the band.