2026/27 calculator
The 60% tax trap calculator
Between £100,000 and £125,140 of adjusted net income you lose £1 of your £12,570 Personal Allowance for every £2 you earn. That makes the effective income tax rate 60% on that slice of income, or 62% with National Insurance, and more with a student loan.
The fix is usually simple: pay the excess into a pension, or give it to charity through Gift Aid. Enter your figures to see what you are losing and what it costs to get it back.
Take-home pay
£5,925.64a month
£71,108 a year
- Income tax
- £31,452
- National Insurance
- £4,144
- Effective rate
- 34.5%
- Marginal rate
- 60%
- Into your pension
- £733/mo
- Child Benefit charge
- £2,337
On £110,000: what it takes to get back to £100,000
| Scenario | Take-home a year | Net income, all sources | Into pension | Income tax | Marginal rate |
|---|---|---|---|---|---|
| No pension | £72,362 | £72,362 | £0 | £33,432 | 62% |
| £500 a month salary sacrifice | £70,082 | £70,082 | £6,000 | £29,832 | 62% |
| £834 a month salary sacrifice, just under £100,000 | £68,557 | £68,557 | £10,008 | £27,429 | 60% |
| £8,000 into a SIPP, £10,000 gross | £72,362 | £68,358 | £10,000 | £29,432 | 62% |
| £1,250 a month salary sacrifice | £65,662 | £65,662 | £15,000 | £25,432 | 42% |
Net income is what you keep after every tax, including relief claimed through Self Assessment. Pension total is everything going into your pot.
Why the rate is 60%
Each extra £100 of income in the band is taxed at 40%, which is £40. It also removes £50 of Personal Allowance, so £50 that was tax-free is now taxed at 40%, another £20. Together that is £60 of tax on £100, plus 2% employee National Insurance. With a Plan 2 student loan the total reaches 71%, and Scottish taxpayers in the advanced band face 67.5% income tax alone.
By £125,140 the allowance has gone completely, and income above that point is taxed at the 45% additional rate.
The childcare cliff edge
If either parent has adjusted net income over £100,000, the household loses Tax-Free Childcare, worth up to £2,000 per child a year or £4,000 for a disabled child, and the funded childcare hours for working parents in England. One pound over the limit removes all of it, so for parents of young children the real cost of earning just over £100,000 can be far higher than 60%.
How to get back under £100,000
Adjusted net income is your total taxable income minus gross pension contributions paid under relief at source and gross Gift Aid donations. Salary sacrifice and net pay pensions reduce it automatically because they come off your pay before tax.
- Salary sacrifice the amount over £100,000 into your pension, which also saves 2% NI.
- Pay into a SIPP: an £8,000 payment becomes £10,000 with basic rate relief and reduces adjusted net income by £10,000.
- Gift Aid donations count at their grossed-up value, so £800 donated reduces it by £1,000.
- Ask for part of a bonus to be paid into your pension before it is paid.
Check your tax code
When HMRC expects your income to exceed £100,000, it reduces the allowance in your tax code and adds a T suffix, for example 757T on £110,000. If you are still on 1257L, you are underpaying and will owe the difference later. The calculator flags this when you enter your code.
Common questions
What is the 60% tax trap?
Between £100,000 and £125,140 of adjusted net income your £12,570 Personal Allowance is withdrawn at £1 for every £2, so each extra £100 costs £60 in income tax in 2026/27, or £62 with National Insurance.
How do I avoid the 60% tax rate?
Reduce your adjusted net income to £100,000 by paying the excess into a pension through salary sacrifice, net pay or a SIPP, or through Gift Aid donations. Each £1 contributed in the band saves up to 62p in tax and NI.
Is the £100,000 limit based on salary or total income?
It uses adjusted net income: all taxable income including bonuses, benefits in kind, rental profit, dividends and savings interest, minus gross pension contributions and Gift Aid.
Do I lose Tax-Free Childcare at £100,000?
Yes. If either parent's adjusted net income is over £100,000 in the tax year, the household loses Tax-Free Childcare and the funded hours for working parents in England.
What tax code will I get over £100,000?
HMRC reduces your allowance and usually adds a T suffix. At £110,000 your allowance is £7,570, giving a code of 757T in 2026/27.
What is the marginal rate in Scotland between £100,000 and £125,140?
It is 67.5% income tax, because the Scottish advanced rate of 45% applies while the allowance is withdrawn, plus 2% National Insurance.
Official sources
Every rate and threshold on this page is checked against these official pages. How we calculate
Related calculators
- Salary sacrificeSee what salary sacrifice saves you in 2026/27. Compare pension, EV and cycle to work schemes, with tax, NI and student loan worked out per payday.
- Pension tax reliefCompare salary sacrifice, net pay and relief at source in 2026/27. See your real cost per £1 in your pension, higher rate relief to claim and annual allowance.
- Bonus taxFind out how much of your bonus you keep in 2026/27 after income tax, National Insurance and student loan, and what sacrificing it into your pension is worth.
- Child Benefit chargeSee how much Child Benefit you keep in 2026/27 once the High Income Child Benefit Charge applies between £60,000 and £80,000, and how a pension removes it.
- Full take-home calculatorEvery deduction, every income source, with an AI assistant that uses your figures.
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