Ndubuisi Egwim explains how doctors and healthcare professionals hit a 60% effective tax rate when income exceeds £100,000, because they lose their personal tax allowance. He covers pension contributions as a workaround and offers a free 10-point checklist to avoid the trap.
This could save you several thousands of pounds, not just in your taxes and pensions have you fallen into the 60% tax trap as a doctor healthcare professional without even knowing? It's crazy. I know you think the highest tax you can pay is 45% but here how it works. If your income exceeds a hundred thousand, you start to lose your personal tax allowance and by the time you hit about 125,000 you've lost your entire tax allowance. This means you're paying an effective tax rate of 60%. That's not good. You lose a lot of other benefits with it. Now if you if it's something you've never thought about or you're worried you're not sure how to navigate it, you're in luck because I've written a very clear guide with a 10 point checklist that you can use to avoid the 60% tax drop. One of the biggest one is obviously paying more into your pension. But there are nine other steps you can take. Check the link in the description and download it for free. Let me know if it helps.
