New tax thresholds

[lastinglily]

Have just had a tax letter advising that 40% tax will kick in April 2026 on earning around £37k. I must have missed this. When was it announced?

You add the personal allowance to the £37k. So if you have the full personal allowance of around £12,500 that is tax free, then you pay 20% on the next £37k, so you don’t start paying 40% tax until you’re on around £50k.

Another thread here about this misunderstanding

www.mumsnet.com/talk/am_i_being_unreasonable/5283261-to-be-annoyed-at-the-new-tax-brackets?page=2&reply=142483308

Exactly as @ChessieFL said. It’s not changed.

There's a huge thread on this in AIBU. The thresholds havent changed, you need to add your personal allowance to the figures.

Ah right. Thanks. I seem to have a reduced personal allowance for next year to around 9k. Not sure why it's not £12570

Do you have any benefits such as medical insurance, company car etc? Have you got an underpayment from a previous year. You should be able to go on to your personal tax account on Government Gateway for more info.

Rainbowunicorn. No company car or employee benefits. I earn FTE around £47k but only 4/5ths (so about £37k) of that as have gone part-time (doing 4 days a week). I also draw down a final salary pension of about £7k

Could be a multitude of things

Incorrect tax code provided by your final salary pension
Tax on savings interest
Underpaid the previous year

HMRC should send a letter saying how much tax you owe and why they have adjusted your tax code.

Some of your personal allowance is likely being used on your pension payment as well as your employment .They will have spilt it. You should be able to see what your tax code for each is.

Very likely to be the drawdown of pension. The tax code may have been split between pension and salary. The easiest thing to doni go on to your government gateway account and check. It will show what the split is and you can get it adjusted if you wish.
Do you have savings interest? This could also have an impact if not in an ISA.

So your tax code is being shared over your main job and your pension. You don't get the £12,500 twice. Your PAYE coding notice will show how the £12.5k is split.