Tools · Tax

60% Tax Trap Calculator

If you earn between £100,000 and £125,140 you pay an effective 60% tax on that slice of income. See your real marginal rate — and exactly how much to pay into your pension to escape it.

2026/27 tax year · England, Wales & Northern Ireland

Your gross annual salary Total pay before tax, National Insurance and any pension.

How the 60% tax trap works

Everyone gets a tax-free personal allowance — £12,570 in 2026/27. But once your income passes £100,000, HMRC removes £1 of that allowance for every £2 you earn. It's gone completely at £125,140.

So on every extra £1 in that band you pay 40% income tax on the pound itself, and you lose 50p of allowance which is then taxed at 40% (another 20p). That's 60p of tax on £1 — a 60% effective marginal rate, or about 62% once you add 2% National Insurance.

How to escape it

The cleanest fix is to bring your adjusted net income back down to £100,000, usually by paying the excess into a pension. Because you're reclaiming lost allowance, the effective relief is roughly 60% (more via salary sacrifice, which also saves NI). Related: our salary sacrifice calculator and bonus tax calculator, and the full explainer, the 60% tax trap and the legal way out.

Frequently asked questions

Does the 60% trap apply in Scotland?

The personal-allowance taper applies UK-wide, but Scotland sets its own income-tax bands, so the exact marginal rate differs. This calculator uses England, Wales & Northern Ireland rates.

What counts as "adjusted net income"?

Broadly, your total taxable income less grossed-up pension contributions and Gift Aid. Salary-sacrifice pension contributions reduce it directly because they lower your gross pay.

Is salary sacrifice better than a personal pension contribution?

For escaping the trap, salary sacrifice is usually most efficient because it also saves the 2% employee NI. Personal (relief-at-source) contributions still restore the allowance but don't save NI.

This calculator provides estimates for general information only and is not financial or tax advice. Based on 2026/27 rates for England, Wales & Northern Ireland; it runs entirely in your browser and stores nothing. Always verify with HMRC or a qualified adviser.