What is the £100k Personal Allowance trap?

Once income passes £100,000, the £12,570 Personal Allowance is withdrawn £1 for every £2 earned, disappearing at £125,140 — an effective 60% marginal tax rate on that slice of income.

How does Gift Aid restore my Personal Allowance?

Gift Aid donations are grossed up by 25% and deducted from your adjusted net income. If that brings you back under £100,000, your full Personal Allowance is restored — worth 40% on the restored amount, on top of the normal 20% reclaim.

How much do I need to donate to escape the trap?

Donate (your income minus £100,000) ÷ 1.25. For example, on £110,000 that is £8,000 — the £10,000 grossed-up gift brings adjusted income to £100,000 and restores the full allowance.

Is this calculator free to embed?

Yes. Financial advisers, charities and publishers can embed it free — the embed includes a dofollow credit link to CharityCompare. Copy the iframe code below.

Calculators

Personal Allowance Gift Aid Calculator

Earn between £100,000 and £125,140? A Gift Aid donation can restore your Personal Allowance — up to 60% effective tax relief. Free UK tool, no sign-up.

Quick answer

Donate (income − £100,000) ÷ 1.25. The grossed-up gift reduces adjusted net income below £100,000 and restores the £12,570 allowance — worth 40% on the restored slice, on top of the normal higher-rate reclaim. Use the calculator below for your exact figures.

The £100k trap: between £100,000 and £125,140 your Personal Allowance is withdrawn £1 for every £2 earned — an effective 60% marginal rate. Gift Aid donations reduce your adjusted net income, so they can restore the allowance on top of the normal 40% reclaim.

Annual gross income

Gift Aid donation

Allowance before

£5,070

of £12,570 available

Allowance after

£8,195

£3,125 restored

Effective relief

50%

£2,500 total on £5,000

Gift Aid grossed up (charity gets): £6,250
Adjusted net income: £108,750
Your 40% reclaim (Self Assessment): £1,250
Allowance-restoration saving: £1,250
Net cost of your donation: £2,500

Optimiser: to restore your full Personal Allowance, donate £12,000 (£15,000 grossed up) — bringing adjusted income back to £100,000. You’re currently £7,000 short of the full restoration.

Estimates only, not tax advice — 2025/26 UK rates (England & Wales). Scottish bands differ; pension contributions also reduce adjusted net income. Calculator by CharityCompare — free to use and embed.

Embed this calculator — free for advisers & charities

Add this exact calculator to your website with one line. Free, lightweight, includes a dofollow credit link to CharityCompare — that’s how the tool stays free.

Iframe embed code

<iframe src="https://www.charitycompare.org.uk/embed/personal-allowance-gift-aid-calculator" width="100%" height="900" style="border:0;max-width:100%;" title="Personal Allowance Gift Aid Calculator — CharityCompare" loading="lazy"></iframe>

Preview the embed →

Free to embed. Includes a dofollow credit link to charitycompare.org.uk — that is how the tool stays free. Embedding on a charity site never affects its Clarity Score.

Why the relief is so high

In the trap, each £1 of income costs 40p tax plus 50p of lost allowance taxed at 40% — an effective 60% rate. A Gift Aid donation attacks both: the grossed-up gift cuts adjusted net income, restoring the allowance, and you still reclaim the 20% band difference on the gross donation. Pension contributions work the same way, and both can be combined.

Estimates only — not tax advice. Scottish bands differ; check HMRC guidance or an accountant.