Work doesn't pay

Another option, if it's something that's based on annual income rather than month to month, is to take a chunk of unpaid parental leave. But this would only work if it's eg child benefit or student loan repayments, not for UC I don't think.

Does sound shit.
maybe some of the posters can help you if you post the before and after. It is anonymous so that’s ok if feeling it’s not the done thing

What were you on? what was take home?

What are you on now? and what is take home?

YABU to say "work doesn't pay." It definitely does, it's just that it doesn't pay for the person actually doing the work - it goes to people higher up the chain.

Are you sure the tax code is correct and have you considered pension and student loans if you have any? My last promotion meant a small net gain (not helped by loss of child benefit and pension contribution increase at the new salary point) but I'm paying more into my pension and more off my student loan so all is not lost.

I had a £30,000 pay rise over the past 2 years, I don't really need it on a day to day basis so it's all going into my pension. Delayed gratification makes work pay. Think of the bigger picture.

It sucks, but I guess you always have the option of turning down the promotion if you aren't happy.

This is broadly what it comes down to.

If you're currently no better off for the extra work you're doing, it's a question of weighing up any other positives versus the negative of having less free time. Whether you're likely to want and get other promotions, how long the childcare costs are liable to last, how do you weigh work/life balance, could you mitigate some of the impact with bigger pension payments or similar. Some of these things are straightforward questions of fact, others are specific to your circumstances and values.

I think I understand something of the frustration that the OP is experiencing. I have recently been turning down opportunities for progression because they would result in a lot more stress and time away from my family for very little financial reward, owing to the loss of Child Benefit. I have a disabled child who qualifies for DLA but this doesn't come near to covering the cost of one parent having to be available for child care pretty much all the time for medical and other appointments.

I have to think of the overall impact on my family, not just earning the most money. Before having children I was a higher rate taxpayer for many years and never begrudged paying a penny of tax and NI. But the marginal financial benefit for me of taking on more responsibility and stress was worth it. It simply isn't now I have children.

Having frozen the tax and NI bands in a time of high inflation, the government has brought so many more people into higher tax/NI bands and losing what used to be a universal benefit. If the government wants a more productive economy in the UK, it shouldn't be disincentivising (sorry, I hate that word) people from achieving more.

You got a payrise AND are doing 20% more hours and you're earning the same?

Tax doesn’t work like that in the U.K. if your gross pay increase then if all else is the same then so will your net.

Could it be the tax code is wrong or you’ve moved up a rung on the amount on your pension contributions?

Even if this promotion is of negligible value, unless it's your last one ever, it's likely to be a step up the ladder that will lead to better opportunities to come. It's an investment in your future career. You have to go up the ladder one step at a time.

When you say you’ve lost benefits are we talking child benefit? If so you could consider paying more into your pension/ gift aid which then reduces your net income and could allow you to claim child benefit?

Alternatively look to the future of your career progression when children are no longer at home would giving up the promotion now be detrimental for your future prospects?

This.

Or as PP said look at whether it's possible to divert some of your income into a pension to reduce the impact

I hit a tax wall a little while ago which meant lost benefits, increased tax, etc. I managed for the last year of childcare by increasing my pension contributions. It sucks, but I guess you always have the option of turning down the promotion if you aren't happy.

The OP hasn't helped herself with either her title or explanation, but there are lots of cliff edges in relation to our tax system, benefits and how they intersect and it's quite conceivable she's hit one of them.

With that in mind, I wouldn't blame you for fucking it off OP, but do think carefully about whether it's the best thing for you and yours. Could you put any extra into a pension, for example?

I personally have avoided an increase in hours when it would've taken me to a point where I'd only be left with about 60% of the take home before paying for the increased childcare, so I'm not saying you have to stick at the job. Just make sure it's an informed decision.

Okay so you are no longer entitled to some benefits, and want to reduce your hours so you still get welfare benefits?

Your OP is misleading. This is not about paying more tax, this is about the benefits you have lost versus the amount of increased take home pay you now receive.

Rather than resign, what about viewing the promotion in terms of your career progression over time.

Neither tax nor NI account for you effectively getting nothing.

So essentially it's benefits loss. So you're working enough to take yourself off benefits now. It is what is it is. Benefits are not income, it's a stop gap until you can support yourself enough.

The next step up will come to you I'd guess.

The £100k-£125k bracket is notoriously cliff-edge due to tax & benefit interaction - I’m assuming that’s where you are.

Sensible advice above re whether you can get to £125k+ and/or if you can cut hours or add to pension.

So you have (quite correctly, legally AND morally) lost benefits due to earning more? No issue then.

Are you tipping into 40%, 45%, over £100k? Important to know to understand the impact.

If the higher end, stick the difference in pension until you get high enough to take the benefit in take home pay.

I always seem to pay more tax in April - due to end of FY I assume - could it be that? Perhaps see what your take-home is in May…
Agree with others it would BU to resign your promotion & prob wouldn’t reflect well on you at work.

Losing your benefits doesn't mean you are paying 'nearly 100% tax'. It means you lost your benefits. Because you don't need them anymore. That's a good thing.

It’s not how tax works but it is how the combination of tax and benefits work at some tipping points.

The extent to which to which working families are subsidized by the state and what this means for us socially is a bit of a blind spot. It’s semi-complicated and the media don’t talk about it much (and when they do it’s often just hyperbole).

It sucks, OP, but unless you think this is the last possible promotion for you, you need to recognise it as a difficult stepping stone that can lead to much more significant income (especially if current difficulties are partly because of a loss of benefits related to children you have).

Well quite it does sound as though she has been promoted beyond her capabilities if she can't understand her own payslip and tax code.