The loss of an individuals personal allowance (for earners over £100,000) should increase each year with inflation.

I dont know anyone prepared to do additional work for 60% tax (plus the loss of valuable childcare). Its simply too high.

I know plenty of NHS consultants who refuse to do any extra work within the NHS because they are paying 60% tax on this income. Because of the way their defined benefit pensions are calculated, they cannot up their pension contributions.

Instead, they do additional private work and use accountants to make this tax-efficient. This makes no sense for anyone. The NHS loses out, and society loses out on the 45% tax that would have been paid.

If this was happening at just over £60k in 2010 the reaction to this would be completely different to the "well if you are lucky enough to earn 100k......" attitude we have now.

I’m now in this bracket and my bonus will all go in my pension and I’m thinking about going part time. I’m by no means wealthy, but there’s now no incentive for me to work harder and earn more.

I suggest you look up the “Laffer curve” to educate yourself.
https://en.m.wikipedia.org/wiki/Laffer_curve

It always intrigues me when OPs start threads about things they have read but don’t actually quote what they read so we can read for ourselves!

To be frank only the top 20% of earners make a net positive contribution to the economy (pay more tax than services used). Fundamentally if you aren’t in that top 20% you are, gulp, a scrounger!

I agree with this, I also think it’s mad that household income isn’t looked at holistically.

when I went (just) over £100k, I had two children in nursery and a DH working as a TA for £15k. Nursery fees went from £2k to nearly £2.5k, our mortgage went from £1200 to £1800 (thanks Liz Truss) and all of a sudden we were really feeling the pinch. We had to delay DH studying for a degree for 3 years, which has also had a knock-on in terms of his earning potential.

I am really pro higher earners paying tax - I’m proud of the welfare system we have and it needs to come from somewhere. But I don’t agree with the sharp cut off at £100k; there are lots of people in a similar position to me and it is so demotivating. the problem is it’s such an emotive issue, you invariably get people saying ‘cry me a river’ and ignoring the issue. The answer here isn’t to fall into ‘sides’, it should be to come up with a system that tapers and is more proportionate.

This isn’t likely to happen until 2028-29, quite a long way off. I think it needs to be done sooner. People spending power is decreasing already, pretty bad for the economy,

@Emiliachonk I don't think anyone is going to answer your question of the source of this information

Anyone proposing a 60% tax threshold on £64000 back in 2010 would have been laughed out of government. Yet that's what we have now.

We have this strange issue in society where people dont seem to be able to get their heads around the fact that 100k is just not the benchmark headline figure it used to be. This has allowed successive government's to keep the ludicrous tax and childcare cliff edge that hasn't been adjusted for inflation in 15 years.

They absolutely should be as they pay the bulk of all income tax.

Someone earning 125k pays 17 times more income tax than someone on 25k. They also receive no child benefit, no tax free childcare and have no access to 30 funded hours.

Without them, everyone else is bankrupt.

It’s not the only downside, the other downside is that by dramatically cutting tax for everyone, benefits and services would also have to be slashed otherwise the country would be broke. That’s probably a downside too, no?

I put YABU but now I know this I rescind it.

Nobody is "put off" working by taxes, they have other reasons. Perhaps they are lazy and feckless and shouldn't be asking for special benefits 😉

I work in a gp surgery. Not a single gp works full time, not even the ones without children 🤷‍♀️

However, we need them to work for the extra money so taxes are collected, if we put them off working too much there will be less collected. We need to see ourselves as a team almost I think, rather than us and them, otherwise the system won't work.

It’s a very different case because at 100k you are impacting the more significant tax payers and pretty much forcing them to make a decision that will reduce the total tax paid by them.

Creating an effective marginal tax rate of 100%, in the case of higher earners with nursery age children, should not be happening in an effective tax system.

You mentioned reading a headline op about this, what paper?

I don't really think the highest earning 5% are really our top priority at the moment.

Yes, Im unaffected as I earn way below this, but I've several friends in a similar position.

It's common in surgeons, my husband is a surgeon and most, if not all, of his colleagues are.

By that logic the personal allowance should also increase with inflation, and so should the thresholds for the other tax bands. It’s not an oversight that they don’t; it’s the strategy of successive governments to raise tax revenues.

I’m in this bracket and can happily agree it’s bonkers. When I got to £100k I put more in my pension and then realised it made more sense to go part time and reduce my salary entirely. This was because I had kids in childcare too, so not only was my marginal tax on each £1 above £100k 62%, it equated to much more as I wasn’t entitled to 30hours funded childcare which is worth £1000s. Also lost entitlement to tax free childcare scheme too. Even more annoying, I’m the only high earner in the family as DH is a basic rate payer. Yet a couple both earning £99,999 can access all these things (still have full personal allowance, childcare hours, tax free childcare) and their household income is much much more than ours !?

make it make sense!

if the cliff edge didn’t exist, I’d never have reduced salary and gone part time or contributed more to pension to stay under £100k. HMRC could have had 40% of all that…

It’s bad for everyone because that cohort will reduce their hours and will then pay less tax that is supposed to support everyone else. Extremely de motivating.

Especially when your job is stressful so if you mess up (doctor / solicitor) you can actually ruin someone’s life. Doing more of that basically for free? Sod that.

Also indirectly has an impact on the progression of women into senior job roles. I work in HR and know of a couple of people who have turned down roles as they are single parents with nursery age kids, the salary increase wasn’t enough to offset what they would lose

I honestly never knew this. I do think that's a bit wrong. I thought everyone got the first bit of their earnings tax free. I didn't think anyone could change my views on people earning £100,000+ 'complaining' (can't think of a better word) but you actually kind of have!