For the 2012/13 tax year, the 50% tax rate for those earning in excess of £150,000 will remain, but this will fall to 45% for the 2013/14 tax year.

In addition to this, it should be remembered that those individuals earning over £100,000, lose £1 of their personal allowance for each £2 of income earned over £100,000 until all the personal allowance is lost, which for the 2012/13 tax year will be at income levels of £116,210.  The effective tax rate on income of between £100,000 and £116,210 is therefore 60% and for individuals with income at this level it is worth considering making pension contributions or Gift Aid payments to reduce the taxable income to less than £100,000.

Also worth noting is that the point at which 40% tax is paid on income is gradually being reduced, so that higher rate taxpayers do not fully benefit from the increases in the personal allowance.