Wednesday 04 March 2026 3:46 pm  |  Updated:  Wednesday 04 March 2026 3:52 pm

The £100k tax cliff edge is punishing ambition

By: Michael Healy

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The £100,000 income cliff edge has become one of the most punitive and distortionary features of the UK tax landscape, says Michael Healy

The government has made clear that it wants to boost economic growth, strengthen UK capital markets, and encourage greater participation in investing. These are ambitions we strongly support. But one part of the current tax system is working directly against them.

The £100,000 income cliff edge has become one of the most punitive and distortionary features of the UK tax landscape. It suppresses aspiration, distorts career decisions, and limits the ability of a key demographic to invest for the long term.

At IG, we recently surveyed more than 1,000 individuals earning between £90,000 and £125,000 – the so-called ‘HENRY’ cohort: High Earners, Not Rich Yet. These are typically mid-career professionals with growing earnings, mortgages, young families, and strong long-term savings potential. In short, they are exactly the group policymakers should want participating actively in UK capital markets.

Yet our research suggests the system is holding them back.

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