Marvin OnumonuFigures obtained by Rathbones showed that more than two million UK workers will earn over £100,000 in the 2026/27 tax year, up from 1.95 million this year and 1.218 million in 2021/22.
This rise comes as frozen income tax thresholds, now set until April 2031, push more people into higher tax bands and expose them to a 60% marginal tax rate.
The data, released through a Freedom of Information request, highlighted that around 6% of the UK’s 34 million workforce will be earning above £100,000 next year.
The number of people in the £100,001 to £110,000 bracket is expected to increase by 5.4% to 374,000.
Olly Cheng, senior financial planning director at Rathbones, said: “Earning £100,000 once felt like financial freedom, but today it often comes with a hidden tax sting.
“Frozen thresholds are inflating tax bills, dragging more people into higher bands, while inflation erodes the real value of earnings.
“This has created a generation of HENRYs – high earners, not rich yet – where those on strong salaries struggle to build wealth because of the double hit of a growing tax burden and the corrosive effect of inflation.”
Cheng added: “Fiscal drag has become one of the most damaging factors affecting the cost of living. What was once considered a ‘stealth tax’ is now widely understood and much maligned.
“By 2028/29, nearly 2.3 million taxpayers are expected to earn above £100,000 – almost half a million more than the estimate for the current tax year – and for families with young children, this will be particularly painful.
“With bonus season approaching, what looks like a reward can quickly turn into a tax shock.”
Passing the £100,000 mark triggers a tapering of personal allowance, resulting in an effective marginal tax rate of 60% between £100,000 and £125,140.
Parents earning just £1 over £100,000 can lose childcare support worth almost £20,000 for two children under five.
The number of people earning £120,000 or more is set to grow by 100,000 to 1.4 million next year, marking a 7.7% increase.
Since thresholds were frozen in 2021, the number of £100,000 plus earners is expected to rise by 69% by April 2027.
Cheng said paying more into your pension, especially through salary sacrifice, is one of the simplest ways to avoid or limit the impact of the 60% income tax trap, as it saves on both income tax and National Insurance for employee and employer.
He noted that not every workplace offers salary sacrifice, so personal pension contributions remain useful, and with the new cap set for April 2029, more people are expected to rely on private pensions to manage their tax position.
Cheng also said donating to charity and claiming share loss relief can help reduce annual tax bills.
He explained that Gift Aid contributions lower adjusted net income, and share loss relief from qualifying investments, such as those in the enterprise investment scheme (EIS) or the seed enterprise investment scheme (SEIS), can be offset against income to save tax at the marginal rate.
