UK Universal Credit Taper Calculator
The 55% taper means every £1 of post-tax earnings reduces UC by 55p. Effective marginal rate can hit 80%+.
UC taper applies to net (post-tax) earnings above the work allowance (varies by household). Combined with PAYE + NI, the effective marginal rate on UC recipients can be 80%+.
Worked examples
£1,000 net extra earnings: UC reduced by £550. Net gain only £450.
Sources:
gov.uk Universal Credit
· retrieved 2026-05-12.
Frequently asked questions
What's a work allowance?
The amount you can earn without affecting UC. Currently around £400/mo (limited circumstances) or £600+/mo (with children/limited capability). Above that, the 55% taper kicks in.
Why is the effective rate so high?
Tax + NI + UC taper stack. Adding 32% (basic-rate marginal) + 55% taper on remaining 68% = ~69% effective marginal rate.