10 Dec 2024
The number of individuals caught in the 60% 'tax trap' has risen by 45% in two years, a Freedom of Information (FOI) request has revealed.
In 2023/24, 634,000 taxpayers were predicted to be caught in the 60% tax bracket, which was up by 45% from 2021/22's figure of 436,000.
The 'tax trap' takes effect when a worker earns more than £100,000 – at this point, an individual's personal allowance (which is currently frozen at £12,570) starts to taper away. The personal allowance has been frozen at this figure since April 2021 and the freeze is set to be maintained until 2028.
The number of taxpayers estimated to lose all of their personal allowance is set to surpass one million by 2027/28.
A spokesperson for the Treasury said: 'We are committed to keeping taxes low for working people, which is why we protected payslips from tax rises and are not extending the freeze on personal tax thresholds past 2027/28.'