The number of people who paid the highest rate of income tax topped 1mn for the first time in 2024-25, after long-frozen thresholds dragged 720,000 people into the additional rate band, new data shows.

If the top 45 per cent tax rate had moved in line with inflation it would be worth ￡211,562 today and would exclude two-thirds of people currently paying it, according to calculations by Bowmore Financial Planning, an advisory firm, underlining the impact of the existing freeze ahead of the autumn Budget.

A freedom of information request it submitted to HM Revenue & Customs showed 720,000 people paid the 45 per cent additional rate in the 2024-25 tax year on income above ￡125,140, but below ￡211,562. A further 385,000 people who had income above ￡211,562 in 2024-25 paid the additional rate, the FOI showed.