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Most people in England, Wales and Northern Ireland never pay more than 40% income tax on any pound they earn. But between £100,000 and £125,140, every extra pound of salary loses 62% to income tax and National Insurance. This post shows where that comes from, using the 2026/27 rules and the same engine as our calculator.
Where the extra tax comes from
Everyone gets a tax-free Personal Allowance of £12,570. Once your income passes £100,000, the allowance shrinks by £1 for every £2 you earn above that line, until it is gone completely at £125,140.
So in that range, each extra £1 of salary is taxed at 40%, and it removes 50p of allowance, which means another 50p of income becomes taxable at 40%. That is 40% + 20% = 60% income tax, plus 2% National Insurance: 62% in total.
What it does to a raise
A £10,000 raise from £100,000 to £110,000 leaves you with just £3,800 of it after tax and National Insurance.
| Salary | Income Tax | National Insurance | Take-home | Average rate | Marginal rate |
|---|---|---|---|---|---|
| £60,000 | £11,432 | £3,211 | £45,357 | 24.4% | 42.0% |
| £90,000 | £23,432 | £3,811 | £62,757 | 30.3% | 42.0% |
| £100,000 | £27,432 | £4,011 | £68,557 | 31.4% | 62.0% |
| £110,000 | £33,432 | £4,211 | £72,357 | 34.2% | 62.0% |
| £125,140 | £42,516 | £4,513 | £78,111 | 37.6% | 47.0% |
| £150,000 | £53,703 | £5,011 | £91,286 | 39.1% | 47.0% |
Every marginal rate up to £150,000
| Salary range | Marginal rate |
|---|---|
| £0 – £12,570 | 0.0% |
| £12,570 – £50,270 | 28.0% |
| £50,270 – £100,000 | 42.0% |
| £100,000 – £125,140 | 62.0% |
| £125,140 and up | 47.0% |
Above £125,140 the allowance is already gone, so the rate drops back to the additional-rate band plus 2% National Insurance.
Scotland is higher still
Scotland uses its own income tax bands, and the same allowance taper applies on top of them. The highest marginal rate for a Scottish taxpayer below £150,000 is 69.5%.
Ways people reduce it
The taper is based on adjusted net income, so pension contributions (including salary sacrifice) and Gift Aid donations can bring income back below £100,000. Our calculator doesn't model these, so check your own situation with HMRC's guidance or an adviser.
See your own figures in the UK salary calculator; its Marginal rate tab draws this schedule for any salary.
Sources
- GOV.UK — Income Tax rates and Personal Allowances
- GOV.UK — Scottish Income Tax 2026 to 2027
- GOV.UK — National Insurance rates and category letters
Figures computed with the rates on these pages, last checked on 30 September 2026.