UK Income Tax Payers 2025/26: How Many in Each Band

The detail

The number of UK higher-rate (40%) Income Tax payers reached a projected 7.08 million in 2025/26 - up 38.7% from 2022/23, when the threshold was last uprated. The £50,270 higher-rate threshold has been frozen since 2021/22 and remains frozen through to 2030/31 after the Autumn Budget 2025 extension. With average wage growth running 4-6% annually, every year of the freeze pulls hundreds of thousands more workers into the 40% band - a phenomenon known as fiscal drag.

Additional-rate (45%) payers grew even faster - up 115.3% from 2022/23, reaching 1.23 million in 2025/26. The threshold was cut from £150,000 to £125,140 in 2023/24 (Spring Budget 2023), pulling around 250,000 extra adults into the band at the stroke of a pen, and ongoing wage growth has compounded the increase.

Higher-rate taxpayers now make up around 18.1% of all UK Income Tax payers, compared with around 13% in 2022/23. The basic-rate (20%) band still covers around 78% of taxpayers, but the share is shrinking each year. The £12,570 Personal Allowance has also been frozen since 2021/22, slowly pulling more low-income workers into the basic-rate net.

For households, the practical implication is that what used to be a clear high-earner threshold (£50,000+) is now squarely middle-class territory in London, the South East and Scotland higher-rate band. The 60% effective marginal rate trap between £100,000 and £125,140 (PA taper) now catches over 1.5 million workers per year - many of them dual-earner professional households who would never historically have considered themselves "high earners".