Reviewed by Mustafa Bilgic
Founder, WebCalculator
Rates use the 2026/27 Income Tax bands and Class 1 NI thresholds published by HMRC. The PA taper zone is a statutory mechanism, not a separate tax band. Not financial advice.
The marginal tax rate calculator shows the tax you pay on your next pound of income for 2026/27. Enter your salary to see your marginal rate, effective rate, and whether you fall into the 60% tax trap between £100,000 and £125,140 where your Personal Allowance is tapered away.
Income Tax + NI combined
| Income band | IT rate | NI rate | Combined |
|---|---|---|---|
| £0 – £12,570 | 0% | 0% | 0% |
| £12,571 – £50,270 | 20% | 8% | 28% |
| £50,271 – £99,999 | 40% | 2% | 42% |
| £100,000 – £125,140 | 60%* | 2% | 62% |
| £125,141+ | 45% | 2% | 47% |
*The 60% band is not a formal rate — it is the effect of losing £1 of Personal Allowance for every £2 earned above £100,000. By £125,140 the full £12,570 allowance is gone.
Earning between £100,000 and £125,140 triggers Personal Allowance tapering. Each extra £2 costs you £1 of allowance, which was shielding income at 40%. The maths: 40% on the pound earned + 40% on the pound of lost allowance = 60% effective marginal tax, or 62% with NI.
The most effective escape is a pension contribution. Contributing enough to bring adjusted net income to £100,000 restores your full Personal Allowance. For example, someone on £110,000 could contribute £10,000 to a pension, saving £6,000 in tax — a 60% tax relief rate. Use the pension tax relief calculator to model this.
Your marginal tax rate is the percentage of tax you pay on the next pound you earn. For 2026/27 it is 20% if you earn between £12,571 and £50,270, 40% between £50,271 and £125,140, and 45% above £125,140. However, between £100,000 and £125,140 the effective marginal rate is 60% because your Personal Allowance is being tapered away.
Your Personal Allowance of £12,570 is reduced by £1 for every £2 you earn above £100,000. This means each extra £1 of income costs you 40p in Income Tax on that pound plus 20p in lost Personal Allowance tax relief — a combined 60% marginal rate on income between £100,000 and £125,140.
Your marginal rate is the tax on your next pound earned. Your effective rate is the average percentage of your total income that goes to tax. A £60,000 earner has a 40% marginal rate but an effective Income Tax rate of about 15.8% because the first £12,570 is tax-free and the next £37,700 is taxed at only 20%.
The most common strategies are pension contributions (which reduce your adjusted net income below £100,000, restoring your Personal Allowance), salary sacrifice, and Gift Aid donations. A £1,000 pension contribution at this level effectively saves you £600 in tax — a 60% return.
Yes. Employee NI adds 8% between £12,570 and £50,270 and 2% above that. So a basic-rate taxpayer's combined marginal rate is 28% (20% tax + 8% NI), a higher-rate taxpayer pays 42% (40% + 2%), and someone in the £100k-£125k taper zone faces 62% (60% + 2%).
The highest statutory rate is 45% additional rate above £125,140. But the effective highest marginal rate is 62% in the £100,000 to £125,140 Personal Allowance taper zone when you include 2% NI. Some individuals also face child benefit clawback (High Income Child Benefit Charge) which can push the effective rate even higher.