60% Tax Trap Calculator UK 2026/27 – Personal Allowance Taper

Updated 5 October 2026: This calculator explains the Personal Allowance taper sometimes called the “60% tax trap”. It is designed for England, Wales and Northern Ireland for the 2026/27 tax year. Scotland has different income-tax bands.

📉 60% Tax Trap Calculator 2026/27

See how adjusted net income above £100,000 reduces your £12,570 Personal Allowance — and estimate how much allowance remains.

Total taxable income before Personal Allowance (£)

Include taxable employment income and other taxable income relevant to adjusted net income, such as taxable pension, property, savings, dividend or self-employment income where applicable.

Pension contributions/other deductions already deductible when working out net income (£)

Only enter amounts that HMRC allows you to deduct at the net-income stage. Do not enter the same pension contribution again below.

Personal pension contribution you paid where provider claimed basic-rate relief (£)

Enter what you actually paid. HMRC gross-ups a qualifying relief-at-source contribution: £800 paid becomes £1,000 for this adjusted-net-income calculation.

Qualifying Gift Aid donations you actually paid (£)

HMRC similarly gross-ups qualifying Gift Aid donations for adjusted net income.

Your estimated 2026/27 position

Adjusted net income£115,000

Personal Allowance left£5,070

Allowance lost£7,500

Why people call this a “60% tax trap”

For non-savings, non-dividend income in the higher-rate band, each additional £2 of adjusted net income above £100,000 can both be taxed at 40% and remove £1 of Personal Allowance. That produces an effective 60% Income Tax marginal rate on that slice. This is an illustration of the Personal Allowance taper — not your complete tax calculation. National Insurance and the tax treatment of savings/dividends are separate.

Pensions can affect adjusted net income — but check before acting.

The standard pension annual allowance is £60,000 for 2026/27, but it can be lower for some people, including certain high earners or people who have flexibly accessed pensions. Employer contributions and defined-benefit pension growth can also count towards the annual allowance.

Official HMRC/GOV.UK guidance How HMRC calculates adjusted net income → 2026/27 Income Tax rates and Personal Allowance → Pension annual allowance guidance →

Important: This is an educational estimate, not tax, pension or financial advice. Adjusted net income can be more complicated than these common inputs. Check HMRC guidance or get professional advice before changing pension contributions or making other financial decisions.

Figures checked: 5 October 2026 • Tax year 6 April 2026 to 5 April 2027

What is the 60% tax trap?

The phrase “60% tax trap” describes the effect of the Personal Allowance taper for some higher earners. In 2026/27 the standard Personal Allowance is £12,570. Once adjusted net income exceeds £100,000, £1 of allowance is withdrawn for every £2 above that threshold. The standard allowance is fully lost at £125,140.

For employment or other non-savings, non-dividend income that would otherwise be taxed at the 40% higher rate, this taper can create an effective 60% Income Tax marginal rate on income within the taper zone. It does not mean your entire income is taxed at 60%.

What is adjusted net income?

Adjusted net income is not simply your salary. HMRC starts with taxable income, which can include employment income, self-employment profits, pensions, savings interest, dividends, rental income and certain other taxable income. Relevant deductions are then made, including qualifying pension contributions and grossed-up Gift Aid in the circumstances set out by HMRC.

Example: £115,000 adjusted net income

If your adjusted net income is £115,000, you are £15,000 above the £100,000 threshold. Half of that — £7,500 — is removed from the standard £12,570 Personal Allowance, leaving an estimated Personal Allowance of £5,070.

Can pension contributions reduce adjusted net income?

Qualifying pension contributions can affect adjusted net income, but the calculation depends on how the pension contribution is made. For example, HMRC says contributions made under relief at source are deducted on a grossed-up basis when calculating adjusted net income. Salary sacrifice works differently because the sacrificed salary is generally not received as taxable pay in the first place.

Do not make a pension contribution solely because a calculator suggests a number. Pension tax rules include an annual allowance and special rules that can reduce it for some people. Your own tax, pension and cash-flow position matters.

Does this calculator work in Scotland?

The Personal Allowance taper still matters, but Scotland has different Income Tax rates and bands for non-savings, non-dividend income. Because the familiar “60%” illustration relies on the 40% higher rate used in England, Wales and Northern Ireland, this calculator does not present itself as a Scottish marginal-rate calculator.

Self-Employed Tax Calculator — estimate Income Tax and Class 4 NI on sole-trader profits.

Important information

This page is for general educational information and estimates only. It is not personalised tax, pension, investment or financial advice. Tax outcomes can depend on the type and timing of income, pension arrangements, Gift Aid, benefits, deductions and other circumstances. Check current HMRC guidance and consider professional advice where appropriate.