For high earning taxpayers the personal allowance is gradually reduced by £1 for every £2 of income over £100,000 irrespective of age. This creates an effective marginal rate of tax of around 60% for tax payers with annual income between £100,000 and £123,000 as the £11,500 tax-free personal allowance is gradually withdrawn. Taxpayers whose income sits within this band should consider what financial planning opportunities are available to avoid this personal allowance trap. This can include gifts to charity, increasing pension contributions and participating in certain investment schemes. These strategies also apply to higher rate and additional rate taxpayers looking to reduce their tax bills.For example, a higher rate or additional rate taxpayer who wanted to reduce their tax bill for the last tax year could decide to make a gift to charity in the current tax year and then elect to carry back the contribution to 2016-17. A request to carry back the donation must be made before or at the same time as the 2016-17 self assessment return is filed. The deadline is 31 October 2017, if you file a paper tax return, or 31 January 2018 for the majority of taxpayers that file online.The option to use increased pension contributions is becoming less clear cut. The annual allowance for tax relief on pensions is £40,000 but the allowance is tapered for taxpayers whose income exceeds £150,000. The allowance will reduce by £1 for every £2 that an individual’s income exceeds £150,000, down to a minimum of £10,000 for individuals with income of £210,000 or more. There are also lifetime limits for pensions contributions after which tax relief is no longer available.