High earners in 60% tax trap set to double
Posted on 19 Sep 2013
High earners in 60% "tax trap" set to double
Projections suggest that the number of high earners caught in a hidden 60% "tax trap" could double by the end of the next tax year. The quirk means those earning £100,000 a year lose their tax-free personal allowance and face a marginal rate of 60% on earnings between £100,000 and £123,000. Data from the IFS shows it will affect at least 800,000 people this year, up from 588,000 in 2010-11. If the trend continues, up to a million people will be dragged into the tax band by the end of next tax year, as wage inflation sends incomes above the tax threshold and the tax band widens in line with the personal earnings allowance.
Source: The Daily Telegraph (02/06/2017)
