As others have said there are some really nasty bottlenecks in the tax system which inevitably result in people taking them in to consideration when they plan their family life. I'm in Scotland, so we don't have the 100k childcare threshold but we have different tax bands which create similar disincentives.
For example, here higher rate tax is going up to 42% starting at just £43,663. In rUK, that threshold is at £50271, which aligns with the point where NI drops from 12% to 2%. In Scotland they don't align, so income between £43663 and £50271 is effectively being taxed at 54%, whereas income between £50271 and £99.9k is only taked at 44% altogether. Plus factor in student loans which many people earning those salaries will have...
Then you hit 100k. Now you're losing the personal allowance at £1 for every £2 over it. So between £100k and £125k you have an effective tax rate of 65% including NI. But then once you go above that, you go to 47%... and at 100k you also lose tax free childcare (which effectively saves 2k net per child per year, so if you have 2 children that's 4k after tax.)
So let's say you're earning 99.9k and have 2 kids using childcare in Scotland. You're offered a 20k pay rise. I'll assume a not extravagent 6% pension contribution.
Of that 20k:
- £12,600 goes in tax (42% plus loss of personal allowance)
- £400 in NI
- £1200 in pension contributions
- Potentially still student loans at 9% = £1800
- extra childcare due to loss of TFC = £4000
So you get precisely zero extra in your pocket, or £1800 if you have paid off student loans.
Or you could work say 4 days in the new role (if possible) and have a virtually identical income, use less paid childcare and end up better off financially as a result.