Your average tax rate is meaningless when deciding what to do with the next pound. This calculator gives you the true marginal rate — including the 60% trap, the High Income Child Benefit Charge, and student loan deductions — so you can see exactly what your next £1 of earnings actually costs.
Educational only. Marginal rates depend on your full circumstances; this is a guideline view, not personalised tax advice.
Your marginal rate is the most actionable number in personal finance. It tells you:
How much of a pay rise you actually keep (take the headline figure × (1 − marginal rate))
How much a pension salary-sacrifice contribution is "worth" — sacrificing £1 saves you marginal-rate × £1
Whether a Gift Aid donation is meaningfully cheaper for a higher-rate taxpayer than a basic-rate one
Whether to try to push a one-off bonus into pension to avoid temporarily entering a higher band
The four UK marginal-rate "spikes" that catch people out
£60,000-£80,000 for households claiming Child Benefit — HICBC clawback adds an effective 5-15% on top of normal marginal rate, scaling with the number of children.
Above £100,000 — losing Tax-Free Childcare and 30 hours childcare for any household with young children. Often >100% marginal cost on the £1 that crosses the threshold.
Above £125,140 — additional rate (45% / 48% Scotland) but no further clawbacks; counter-intuitively, the marginal rate falls from the 60% trap into the 47% additional rate band.
Tax-saving tip — find your nearest "cliff"
Plan with marginal rate, not average rate
If you're earning £62,000 and your marginal rate is 51% (40% income tax + 2% NI + 9% Plan 2 student loan), then a £5,000 pension salary sacrifice has a true cost to take-home of £2,450 (£5,000 × 49%), not £4,000. The same calculation done with average tax rate (~26% at this income) gives a misleading "cost" of £3,700. Always model trade-offs at marginal rate.
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