The 60% Tax Trap

Once your taxable income passes £100,000, you start to lose the tax-free personal allowance. It drops by £1 for every £2 you earn above that point. By £125,140 it is gone. In this band, each extra pound is taxed at about 60p. That is why people call it the 60% tax trap.

It reaches some consultants, GPs and other senior NHS staff. Pension contributions and salary sacrifice lower your taxable pay, so they can move you back below the trap.

A full guide with worked examples is on the way. For now, you can model it on your own pay with the Casomo take-home pay calculator, or see the full deduction chain on the NHS doctor pay pages.