These taxpayers pay the higher rate of income tax to HMRC while losing their tax-free personal allowance – amounting to an effective 60% on this slice of their earnings.
The number of taxpayers caught by this tax trap has almost doubled in the past five years alone.
This tax trap is a well-known problem that was unfortunately ignored in the Autumn Budget.
Our CEO Mark Incledon was quoted in the Financial Times commenting on the scale of the problem.