45% Tax Rate in UK

The UK removed the 50% tax bracket from 6 April 2013, reducing the top rate of tax payable to 45%. This is still dramatically higher than the previous (pre-2010) upper tax limit of 40% and it goes counter to the Tory's pre-election promise to reduce the top rate back to 40%. There have long been solutions in the UK to minimise the effect of the top tax bracket, in particular by shielding bonuses and discretionary payments. You can find out more in our section on high income tax management.

Whether we will see any moves back to the UK from those high earners who fled between 2010 and 2013 is another question entirely. There are many other countries, like Gibraltar, working hard to attract them with no VAT, capped income tax and low corporation taxes. The other big attraction that other states can offer is stable tax policies, something the UK government would be wise to consider...