Last updated: 28 February 2026
The 60% tax trap is one of the most punishing features of the UK tax system, and barristers are disproportionately affected. If your taxable income falls between £100,000 and £125,140, you face an effective marginal tax rate of 60% on every additional pound earned. This guide explains why it happens, how it affects barristers specifically, and the practical steps you can take to avoid it.
What is the 60% tax trap?
The 60% tax trap arises from the interaction between higher-rate income tax and the personal allowance taper. Every UK taxpayer receives a personal allowance of £12,570 (for 2025/26) – the amount you can earn tax-free. However, once your adjusted net income exceeds £100,000, this allowance is reduced by £1 for every £2 of income above that threshold.
By the time your income reaches £125,140, the entire personal allowance has been withdrawn. The effect on the £100,000–£125,140 band is severe:
- 40% higher-rate income tax on the income itself
- Plus an additional 20% effective rate because the lost personal allowance means £1 of previously untaxed income now becomes taxable at 40%
- Total effective rate: 60%
For every £100 earned in this band, you keep just £40. Add National Insurance at 2% and the effective rate rises to 62%.
Why barristers are especially affected
Barristers’ earnings are inherently volatile. A criminal barrister might earn £75,000 in one year and £130,000 the next as cases resolve and fees are paid. A commercial silk might have consistent earnings well above £125,140 most years but occasionally dip into the trap zone during a quieter period.
This volatility creates two problems:
- Unpredictability – it is difficult to know in advance whether your income will land in the £100,000–£125,140 band
- Cash basis timing – under the cash basis of accounting (which most barristers use), income is taxed when received, not when earned. A large fee paid in April rather than March can push you into the trap in a different tax year than expected
The result is that many barristers pay 60% tax in some years without realising it until they see their self-assessment calculation.
The £100,000–£125,140 income band explained
The arithmetic behind the taper is straightforward but the effect is startling. Consider a barrister whose taxable income increases from £100,000 to £102,000:
- The £2,000 increase is taxed at 40% = £800
- The personal allowance is reduced by £1,000 (half of £2,000)
- That £1,000 of previously allowance-sheltered income is now taxed at 40% = £400
- Total tax on £2,000 of additional income = £1,200
- Effective rate = 60%
This means a barrister earning £125,140 pays more tax on their last £25,140 than a barrister earning £200,000 pays on their last £25,140 (where the rate is 45%, or 47% above £125,140 in the additional rate band).
Pension contributions: the primary escape route
The most effective way to avoid the 60% trap is to make pension contributions that bring your adjusted net income below £100,000. Pension contributions made under the net pay arrangement (used by most personal pension schemes) are deducted from your income before the taper calculation.
Annual allowance
You can contribute up to £60,000 per year to pensions (the annual allowance for 2025/26), subject to having sufficient earnings. For a barrister earning £115,000, a contribution of £15,000 would bring adjusted net income to £100,000, fully preserving the personal allowance.
Carry forward
If you have unused annual allowance from the previous three tax years, you can carry it forward. This is particularly useful for barristers who have a bumper year – you could potentially contribute significantly more than £60,000 in a single year by using carried-forward allowance.
For example, if you contributed nothing to a pension in the previous three years, you could contribute up to £240,000 (4 × £60,000) in the current year, though the contribution must not exceed your earnings for the year.
Net pay vs relief at source
Most pension schemes used by barristers operate on a relief at source basis, meaning you contribute from post-tax income and the pension provider claims basic-rate relief from HMRC. You must then claim higher-rate and additional-rate relief through your self-assessment return.
The key point is that the contribution still reduces your adjusted net income for taper purposes, regardless of whether the scheme uses net pay or relief at source. The tax relief is the same; only the mechanics differ.
Gift Aid donations
Gift Aid donations also reduce your adjusted net income. If you already make charitable donations, ensuring they are Gift Aid eligible can help push your income below £100,000.
The effective cost of donating within the 60% band is remarkably low. A £1,000 gross Gift Aid donation made from the taper band effectively costs just £400 after all tax reliefs are claimed, compared to £600 for a higher-rate taxpayer outside the taper zone.
This makes the £100,000–£125,140 band the most tax-efficient income from which to make charitable gifts.
Timing of fee receipts under cash basis
Under the cash basis of accounting, barristers are taxed on fees when received, not when the work was performed. This creates a legitimate planning opportunity: if you can influence when fees are collected, you can control which tax year the income falls into.
Practical examples:
- If your income is likely to exceed £100,000 in the current year but not the next, delaying invoicing or collection of a fee until after 5 April moves it into the following tax year
- Conversely, if next year will be a high-earning year regardless, accelerating fee collection into the current year may keep both years’ income out of the taper zone
This requires careful forecasting. Your accountant should review your position in January or February each year to identify whether timing adjustments could save tax. At Jack Ross, we routinely model these scenarios for our barrister clients as part of our tax planning service.
From April 2026, barristers within Making Tax Digital will be filing quarterly updates, which will make it easier to track cumulative income and identify when the taper zone is approaching.
Incorporation as a longer-term solution
Operating through a limited company can mitigate the 60% trap because you control how much income you extract each year. Profits retained within the company are subject to corporation tax (25%) rather than income tax, and you can draw salary and dividends in a combination that keeps your personal income below £100,000.
However, incorporation involves significant costs and complications:
- IR35 rules may apply, potentially negating the tax benefits
- You lose the simplicity of sole practitioner accounting
- Bar Standards Board requirements must be met
- Retained profits are still subject to tax when eventually extracted
Incorporation makes most sense for barristers who consistently earn well above £125,140 and want to retain profits within the company for investment or future pension contributions. For those whose income fluctuates around the taper zone, pension contributions are usually a more practical solution.
Worked example: barrister earning £115,000
James is a self-employed barrister with taxable profits of £115,000 for 2025/26. Let us compare his position with and without a pension contribution.
Scenario A: no pension contribution
James’s adjusted net income is £115,000. His personal allowance is tapered:
- Income over £100,000: £15,000
- Allowance reduction: £15,000 ÷ 2 = £7,500
- Remaining personal allowance: £12,570 − £7,500 = £5,070
| Band | Income | Rate | Tax |
|---|---|---|---|
| Personal allowance | £5,070 | 0% | £0 |
| Basic rate (£5,070 to £50,270) | £45,200 | 20% | £9,040.00 |
| Higher rate (£50,270 to £115,000) | £64,730 | 40% | £25,892.00 |
| Total income tax | £34,932.00 | ||
Scenario B: £15,000 pension contribution
James makes a £15,000 pension contribution, reducing his adjusted net income to £100,000. His full personal allowance of £12,570 is preserved.
| Band | Income | Rate | Tax |
|---|---|---|---|
| Personal allowance | £12,570 | 0% | £0 |
| Basic rate (£12,570 to £50,270) | £37,700 | 20% | £7,540.00 |
| Higher rate (£50,270 to £100,000) | £49,730 | 40% | £19,892.00 |
| Total income tax | £27,432.00 | ||
The saving
| Without pension | With pension | |
|---|---|---|
| Income tax | £34,932.00 | £27,432.00 |
| Tax saving | £7,500.00 | |
| Pension contribution | – | £15,000.00 |
| Effective cost of £15,000 pension | £7,500.00 | |
The £15,000 pension contribution costs James just £7,500 after tax relief – a 50% effective rate of relief. This is substantially better than the standard 40% higher-rate relief, because the contribution also restores £7,500 of personal allowance that would otherwise be lost to the taper.
In retirement, James will pay income tax on pension withdrawals, but likely at a lower rate than the 60% effective rate he avoids now.
When the trap does not apply
The 60% trap is specific to the £100,000–£125,140 band. It does not apply if:
- Your income is consistently below £100,000 – the personal allowance is not tapered
- Your income is consistently above £125,140 – the personal allowance is already fully withdrawn, so there is no further taper effect. The marginal rate above £125,140 is 45% (additional rate), which is lower than the 60% in the taper zone
- You have already made sufficient pension contributions or Gift Aid donations to bring your adjusted net income below £100,000
For barristers earning £150,000 or more every year, the trap is irrelevant – the personal allowance has already gone. But for the substantial number of barristers whose income fluctuates around the £100,000–£130,000 range, it is worth planning actively to avoid the 60% zone in years when income peaks. Your accountant should flag this as part of your annual tax planning review.
Frequently asked questions
What is the 60% tax trap for barristers?
The 60% trap is the effective marginal tax rate between £100,000 and £125,140 of income, caused by the withdrawal of the personal allowance. For every £2 earned above £100,000, £1 of personal allowance is lost, creating a combined effective rate of 60% (40% income tax plus 20% from the lost allowance).
How much pension contribution do I need to avoid the 60% trap?
You need to contribute enough to bring your adjusted net income to £100,000 or below. If your income is £115,000, a £15,000 pension contribution achieves this. The maximum you can contribute in a single year is £60,000 (plus any unused allowance carried forward from up to three previous years).
Can I use salary sacrifice to avoid the 60% trap?
Salary sacrifice is relevant only to employed barristers or those taking a salary from their own limited company. Self-employed barristers make pension contributions directly rather than through salary sacrifice, but the taper reduction effect is the same.
Does the 60% trap affect National Insurance as well?
Class 4 NICs at 2% continue to apply above £50,270 regardless of the personal allowance taper. The 60% rate relates to income tax only. With NICs included, the effective rate in the taper zone is 62%.
Is it worth earning less to avoid the 60% trap?
Earning less is rarely the right strategy – you still keep 40% of each additional pound. Instead, redirect income into pension contributions or Gift Aid, which reduce your adjusted net income while building long-term wealth or supporting causes you value.
Need specialist help?
Jack Ross Chartered Accountants specialise in tax advice for barristers at every career stage.
