The £100k tax trap calculator
Between £100,000 and £125,140 you lose £1 of tax-free allowance for every £2 you earn, so that slice of pay is taxed at 60%, plus 2% National Insurance. With young children, you can also lose Tax-Free Childcare and the funded hours for working parents the moment you go £1 over £100,000. See what that costs you, and what paying more into your pension gets back.
On your next £1,000 of salary
You keep £380
62% goes in tax and deductions. You're inside the trap: every £2 you earn here also takes £1 off your tax-free allowance.
Uses income tax rates for England, Wales and Northern Ireland. If you live in Scotland, you pay Scottish income tax, which has different bands, so these figures will be off.
Paying £10,000 more into your pension
Costs you £3,800
Take-home pay falls by £3,800. Each £100 into your pension costs you £38.
- Adjusted net income now
- £110,000£10,000 over £100,000
- Tax-free allowance now
- £7,570of the full £12,570
| Item | Now | With extra pension |
|---|---|---|
| Pay after salary sacrifice | £110,000 | £100,000 |
| Income tax | −£33,432 | −£27,432 |
| National Insurance | −£4,211 | −£4,011 |
| Take-home pay | £72,357 | £68,557 |
| Into your pension | £0 | £10,000 |
About these numbers
- Uses 2026/27 rules and the income tax rates for England, Wales and Northern Ireland. If you pay Scottish income tax, the bands are different and these figures will be off.
- Covers one person's salary only. Bonuses, benefits in kind, rental or savings income all count towards adjusted net income too.
- Salary sacrifice is shown without any employer National Insurance savings your employer might pass on. From April 2029, only the first £2,000 a year sacrificed into a pension will be free of National Insurance; income tax relief is unchanged.
- For personal contributions, the take-home figure assumes you've claimed the higher-rate relief you're owed through Self Assessment.
- Tax-Free Childcare and the funded hours for working parents stop if either parent's adjusted net income is over £100,000, so check both of you.
- Money in a pension usually can't be taken out until your late 50s.
Common questions
What does the trap cost at £110,000?
At a £110,000 salary you keep £380 of the next £1,000 you earn, or £290 with a Plan 2 student loan. Paying £10,000 more into your pension by salary sacrifice brings your adjusted net income back to £100,000 and costs £3,800 of take-home pay.
Is the £100,000 based on my salary?
It's based on your adjusted net income for the tax year, 6 April to 5 April. That's your taxable income, including bonuses, benefits from your job, savings interest, dividends and rental income, less pension contributions you pay yourself and Gift Aid donations. Salary you give up through salary sacrifice isn't counted in the first place. This calculator covers salary only.
I pay into a SIPP myself. Which amount counts?
The gross amount, after your provider adds basic-rate tax relief. Each £1 you pay in takes £1.25 off your adjusted net income, so paying in £8,000 brings it down by £10,000. In the calculator, enter the gross figure as the extra contribution and choose Personal contribution to see what leaves your take-home pay.
Do my employer's pension contributions count?
Only if they come from salary sacrifice. Contributions your employer pays on top of your salary aren't taxed as your income, so they don't change your adjusted net income. With salary sacrifice, your salary goes down by the amount your employer pays in instead, and that lowers it.
Can I put my bonus into my pension?
Some employers let you swap all or part of a bonus for a pension contribution through salary sacrifice. Otherwise a bonus counts towards adjusted net income like salary. To see the effect here, enter your salary including the bonus and put the amount you'd swap in the extra contribution.
Does Gift Aid lower it?
Yes. Gift Aid donations come off your adjusted net income at their grossed-up value: £1.25 for every £1 you give.
Does a car through salary sacrifice count?
The car is a taxable benefit, and benefits from your job count as income. For a car with CO2 emissions of 75g/km or less, such as an electric car, your adjusted net income falls by the salary you give up less the car's taxable value. For other cars, the taxable value is at least the salary you give up, so it doesn't fall. This calculator doesn't include cars.
Is it my income or our household's?
Each person's own. Your tax-free allowance depends on your income alone. The Child Benefit charge falls on whichever partner has the higher adjusted net income. Tax-Free Childcare and the funded hours for working parents stop if either of you expects to be over £100,000 for the current tax year.