UK 40% tax bracket The rate of tax in 40 percent tax in the UK consists of the higher rate of tax on the personal income of people who earn between 50 271 to 125 140 annually. The income only in this range is only taxed at 40% not the whole amount. The rates expected to be charged on the income below and above that range are 20 and 45 percent respectively. This system of bracket assists in fairness and progressive taxation. Being able to know what bracket you are in is also important as far as financial planning and deduction.