Millions More UK Taxpayers Pulled Into the 40% and 45% Bands in 2026/27

What the source announced

The 45% additional rate of income tax is set to be paid by 1.3 million people in the 2026/27 tax year, according to HMRC projections reported by MoneyWeek.

That additional-rate taxpayer count has risen by 33.8% since 2023/24 (MoneyWeek, 2026). Over the same period, the number of people paying the 40% higher rate of income tax rose by 34% (MoneyWeek, 2026).

The 40% higher rate band applies to earnings between £50,270 and £125,140 and is projected to cover 7.7 million people in the 2026/27 tax year (MoneyWeek, 2026). Below the £50,270 threshold, each pound of taxable earnings is charged at the 20% basic rate; above it, the rate on each additional pound rises to 40%.

The total number of income taxpayers across all UK bands is projected at 40.8 million in the 2026/27 tax year, up from 36.7 million in 2023/24 (MoneyWeek, 2026).

What this means for your income tax

The £50,270 threshold is where the marginal rate on each additional pound of earnings shifts from 20% to 40%. For a salary that crosses that line, only the earnings above the threshold are charged at the higher rate, income below it remains at the basic rate. The income tax calculator applies the correct rate to each slice of income automatically, returning an accurate monthly and annual take-home figure.

The 7.7 million people projected in the higher rate band for 2026/27 is a 34% rise on the 2023/24 figures (MoneyWeek, 2026). For anyone whose earnings sit near or above £50,270, the income tax calculator shows the precise take-home impact of being in the higher rate band rather than the basic rate band. Calculate Your Take-Home Pay →

At £125,140, the rate rises to 45%. With 1.3 million people projected at that level in 2026/27, the additional rate is increasingly common among higher earners. The income tax calculator covers all three rates, basic, higher, and additional, and returns an accurate take-home figure for any UK salary. Calculate Your Income Tax →

Two salaries either side of the threshold: £50,000 vs £55,000

What does joining the 7.7 million actually cost? Compare two 2026/27 salaries using the published bands — £12,570 Personal Allowance, 20% to £50,270, 40% above (gov.uk) — and employee National Insurance at 8% between £12,570 and £50,270, then 2% above (gov.uk).

£50,000 — entirely basic rate:

• Step 1: Taxable income: £50,000 − £12,570 = £37,430.
• Step 2: Income tax: £37,430 × 20% = £7,486.00.
• Step 3: National Insurance: £37,430 × 8% = £2,994.40.
• Step 4: Take-home: £50,000 − £7,486.00 − £2,994.40 = £39,519.60.

£55,000 — £4,730 into the higher-rate band:

• Step 1: Taxable income: £55,000 − £12,570 = £42,430.
• Step 2: Basic-rate slice: £37,700 (£50,270 − £12,570) × 20% = £7,540.00. Higher-rate slice: £4,730 × 40% = £1,892.00. Income tax: £9,432.00.
• Step 3: National Insurance: £37,700 × 8% = £3,016.00, plus £4,730 × 2% = £94.60. Total £3,110.60.
• Step 4: Take-home: £55,000 − £9,432.00 − £3,110.60 = £42,457.40.

The £5,000 of extra gross pay delivers £2,937.80 in the pocket. Of the £4,730 that sits above £50,270, each pound loses 40p to income tax and 2p to National Insurance — a combined 42% marginal deduction, against 28% for a pound below the threshold. Crossing into the higher-rate band never reduces take-home pay; it changes what each additional pound is worth.

What the additional rate looks like on £130,000

At the top of the projections sit the 1.3 million additional-rate payers. A £130,000 salary in 2026/27 works through like this. The Personal Allowance falls by £1 for every £2 of income over £100,000 and reaches zero at £125,140 (gov.uk), so at £130,000 there is no allowance left.

• Step 1: Personal Allowance: £0. Taxable income: £130,000.
• Step 2: Basic-rate slice: £37,700 × 20% = £7,540.00.
• Step 3: Higher-rate slice: £87,440 (£125,140 − £37,700) × 40% = £34,976.00. With no Personal Allowance, the higher-rate band runs from £37,700 to £125,140 of taxable income.
• Step 4: Additional-rate slice: £130,000 − £125,140 = £4,860, × 45% = £2,187.00.
• Step 5: Income tax: £7,540.00 + £34,976.00 + £2,187.00 = £44,703.00. National Insurance: £37,700 × 8% + £79,730 × 2% = £3,016.00 + £1,594.60 = £4,610.60.
• Step 6: Take-home: £130,000 − £44,703.00 − £4,610.60 = £80,686.40 — an overall deduction rate of 37.9%.

The rates the three headline bands don't show

Between £100,000 and £125,140 the marginal rate is worse than the 45% headline above it. A £1,000 pay rise at £101,000 is taxed at 40% (£400) and removes £500 of Personal Allowance, exposing another £500 to 40% tax (£200) — £600 of income tax on £1,000 of pay, a 60% effective marginal rate before the 2% National Insurance (gov.uk). The mechanics are set out in the 60% tax trap guide.

Band membership also moves the tax on savings interest. The Personal Savings Allowance is £1,000 at the basic rate, £500 at the higher rate, and £0 at the additional rate (gov.uk) — so the pay rise that lifts someone past £50,270 halves their tax-free interest, and reaching £125,140 removes it entirely. For the millions newly projected into the 40% and 45% bands, the band shift reprices savings held outside an ISA as well as salary.