MPs’ salaries are set to rise toward £110,000 in the coming years, placing them squarely within one of the UK tax system’s most notorious quirks: the £100,000 income threshold where effective marginal tax rates can hit 60 per cent.

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But there is a catch. Many MPs will avoid the trap entirely. Because their generous defined-benefit pension contributions are deducted before tax, an MP earning £110,000 will likely see their taxable income fall back below the threshold. The system effectively shields them from a cliff edge that millions of private-sector workers cannot escape so easily.

For professionals earning between £100,000 and £125,140, the loss of the personal allowance creates a 60 per cent effective tax rate. For parents of young children, the hit is even harsher as they lose tax-free childcare and free hours.

Recent IG research reveals how........

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