There is no evidence base to support the use of 6-monthly monitoring blood tests for the early detection of liver, blood and renal toxicity during established anti-tumour necrosis factor alpha (TNFα) treatment. To evaluate the incidence and risk factors of anti-TNFα treatment cessation owing to liver, blood and renal side-effects, and to estimate the cost-effectiveness of alternate intervals between monitoring blood tests. A secondary care-based retrospective cohort study was performed. Data from the British Association of Dermatologists Biologic and Immunomodulators Register (BADBIR) were used. Patients with at least moderate psoriasis prescribed their first anti-TNFα treatment were included. Treatment discontinuation due to a monitoring blood test abnormality was the primary outcome. Patients were followed-up from start of treatment to the outcome of interest, drug discontinuation, death, 31 July 2021 or up to 5 years, whichever came first. The incidence rate (IR) and 95% confidence intervals (CIs) of anti-TNFα discontinuation with monitoring blood test abnormality was calculated. Multivariate Cox regression was used to examine the association between risk factors and outcome. A mathematical model evaluated costs and quality-adjusted life years (QALYs) associated with increasing the length of time between monitoring blood tests during anti-TNFα treatment. The cohort included 8819 participants [3710 (42.1%) female, mean (SD) age 44.76 (13.20) years] that contributed 25 058 person-years (PY) of follow-up and experienced 125 treatment discontinuations owing to a monitoring blood test abnormality at an IR of 5.85 (95% CI 4.91-6.97)/1000 PY. Of these, 64 and 61 discontinuations occurred within the first year and after the first year of treatment start, at IRs of 8.62 (95% CI 6.74-11.01) and 3.44 (95% CI 2.67-4.42)/1000 PY, respectively. Increasing age (in years), diabetes and liver disease were associated with anti-TNFα discontinuation after a monitoring blood test abnormality [adjusted hazard ratios of 1.02 (95% CI 1.01-1.04), 1.68 (95% CI 1.00-2.81) and 2.27 (95% CI 1.26-4.07), respectively]. Assuming a threshold of £20 000 per QALY gained, no monitoring was most cost-effective, but all extended periods were cost-effective vs. 3- or 6-monthly monitoring. Anti-TNFα drugs were uncommonly discontinued owing to abnormal monitoring blood tests after the first year of treatment. Extending the duration between monitoring blood tests was cost-effective. Our results produce evidence for specialist society guidance to reduce patient monitoring burden and healthcare costs.