![]() You can read our recent article on “What is the 40% tax bracket?” to understand how these ‘marginal tax rates’ work. Here are the current income tax rates and bands for the 2034-24 tax year: Above that, there are three main tax brackets: you’ll be taxed the basic rate (20%) on everything you earn up to £50,270, then the higher rate (40%) on everything you earn up to £125,140 and then the additional rate (45%) on everything you earn above that, as shown in the table below. In the current UK tax system, individuals earning less than £100,000 won’t be charged any tax on the first £12,570 they earn. ![]() The tax rates are divided into several bands or tax brackets, each with its own corresponding tax rate. Let’s start by breaking down how the UK income tax system works: How do UK income tax rates work?Įvery worker living in the UK is subject to income tax, which is charged based on their yearly income. ![]() ![]() In this article, we’ll explore how the UK income tax system works, what this means for individuals earning over £100,000, and the tax relief options that you should be aware of when your earnings reach and surpass six figures.īy understanding the tax implications of earning over £100,000, you can make financially savvy decisions to minimise your tax bill and maximise your savings for later in life. However, it's important to understand the tax implications that come with this higher level of income. Earning over £100,000 can be a significant milestone for anyone living in the UK. ![]()
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