Your situation
Tax code when you earn over £100,000
Past the income limit, each extra pound costs you allowance too: how the code shrinks to 0T.
Your situation points to
757L
Your current code takes about £2,004.00 too little this year.
| Tax due for the year | £33,432.00 |
| Taken with 1257L | £31,428.00 |
| Taken with the expected code | £33,428.00 |
| Personal Allowance | £7,570 |
Estimate on employment and pension income only. HMRC sets your code from its own records; savings, property and other income can change it.
Once your adjusted net income goes above £100,000, your Personal Allowance is cut by £1 for every £2 over that limit, and at £125,140 nothing of the £12,570 is left (GOV.UK, Income Tax rates). HMRC passes that cut into your code. On a salary of £110,000, the allowance falls to £7,570 and the expected code is 757L; from £125,140 upwards the code is 0T, meaning no tax-free pay at all. Between those two figures each extra £2 of income is taxed at 40% and also removes £1 of allowance, which is itself then taxed at 40%, so the slice from £100,000 to £125,140 costs 60p in every pound. Adjusted net income is not just salary: it is your taxable income after deducting certain reliefs such as gross pension contributions and grossed-up Gift Aid, which is why those payments can restore part of the allowance (HMRC, adjusted net income). The figures here are for 2026 to 2027.
Personal Allowance above £100,000
Personal Allowance left
£7,570
| Code if this is all from one job | 757L |
| Allowance lost | £5,000 |
| Extra tax from the lost allowance (40%) | £2,000 |
£1 of allowance goes for every £2 above £100,000; none is left at £125,140.
Rules read on HMRC’s texts by Radif Partners · Editorial policy · Method
The taper step by step
The rule is mechanical. Take your adjusted net income, subtract £100,000, halve the result and take that from the allowance of £12,570. At £125,140 the allowance reaches zero and stays there. The table applies it to salaries from one job in England or Northern Ireland with no other income, benefits or reliefs.
| Adjusted net income | Personal Allowance left | Expected code | Tax for the year |
|---|---|---|---|
| £100,000 | £12,570 | 1257L | £27,432.00 |
| £105,000 | £10,070 | 1007L | £30,432.00 |
| £110,000 | £7,570 | 757L | £33,432.00 |
| £115,000 | £5,070 | 507L | £36,432.00 |
| £120,000 | £2,570 | 257L | £39,432.00 |
| £125,140 | £0 | 0T | £42,516.00 |
| £140,000 | £0 | 0T | £49,203.00 |
Above £125,140, income is taxed at the additional rate of 45%, and the code stays at 0T. Scottish taxpayers lose their allowance on the same scale but pay Scottish rates on top, so their code reads S0T at the end of the taper.
A worked case makes the arithmetic visible. At £115,000, the excess over the limit is £15,000; half of it, £7,500, comes off the allowance, leaving £5,070. Drop the last digit and add the letter, and the code is 507L. Compared with £100,000, the extra £15,000 of income carries £9,000.00 of additional Income Tax, which is 60% of it. Above £125,140, each extra pound costs 45p and nothing more, so the marginal rate actually falls at that point.
What goes wrong when the code is not updated
A code is only as good as the income HMRC expects you to earn. Suppose your record still shows a salary under the limit and the payroll keeps 1257L while you actually earn £110,000. Over the year PAYE would take £31,428.00, while the tax due is £33,432.00: a gap of £2,004.00, exactly 40% of the allowance you were no longer entitled to. That gap is then collected through a later code or a letter after the year. See how owed tax is collected through a code.
The cure is to keep the estimate in your HMRC online account realistic, including expected bonuses and taxable benefits. HMRC can then issue a code that takes the taper into account from the start (updating your details).
Two codes on the same pay
0T against 1257L, over the year
+£5,031.60
| Tax with 1257L | £37,484.00 |
| Tax with 0T | £42,515.60 |
| Each month | £419.30 |
Adjusted net income: what reduces it
The taper is tested on adjusted net income, not on the figure on your contract. HMRC's guidance builds it in four steps: add up taxable income, including employment pay and benefits, pensions, savings interest, dividends and rental profit; deduct reliefs such as pension contributions paid without tax relief and trading losses; deduct grossed-up Gift Aid; then deduct grossed-up pension contributions made where the provider claimed basic rate relief (adjusted net income). Salary is only the starting point, so savings or a rental flat can push you over the limit even when your pay alone sits below it.
The same measure decides the High Income Child Benefit Charge, which starts at a lower level. A household above both thresholds can therefore see two separate deductions working on the same code.