£100k Tax Trap Calculator
Between £100,000 and £125,140, every extra £1 you earn loses you 50p of tax-free Personal Allowance on top of ordinary Income Tax, an effective 60% marginal rate (62% with National Insurance). Parents can lose thousands more in childcare support. See your exact position, and the pension move that can undo it.
Estimate only. This calculator gives estimates for information only, not tax or financial advice. Pension contribution limits (the Annual Allowance and Money Purchase Annual Allowance) and childcare eligibility rules are personal to you, check gov.uk or speak to a financial adviser before acting.
Enter a salary to see your position
Your Personal Allowance lost, current marginal rate, the marginal-rate curve and your pension escape route appear here.
Why £100,000-£125,140 is the UK's worst tax zone
Above £100,000 of income, you lose £1 of your tax-free Personal Allowance for every £2 you earn, so £2 of extra income is taxed at 40%, AND turns £1 of previously tax-free income taxable at 40% too, working out at an effective 60% marginal Income Tax rate (62% once the 2% National Insurance on earnings above £50,270 is added). Parents face a second, sharper cliff-edge: Tax-Free Childcare and the 30-hours-free-childcare schemes are withdrawn completely, not tapered, the moment either parent's adjusted net income passes £100,000, which for a family with two young children can be worth many thousands of pounds a year. The escape route for both is the same: pension contributions (and Gift Aid) reduce your adjusted net income, so contributing the excess over £100,000 can regain the full Personal Allowance and childcare support, often making the effective return on that contribution well over 100%.
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