Does anyone here pay 50p tax?

[MacRS4]

prove anything other than mortgages are more. i call your bluff.

taxis in london are the same price as up here. internet isnt more expensive to shop on. BT dont charge you more. care prices are very similar. supermarkets charge the same, as do national companies like Argos and M&S and beer is the same price, as is food.

the 1980s called and wants their argument back. its no longer the case.

PLUS: yes, the houses are more. but you can sell them and get that cash back. then either emigrate, move north, move west etc etc.

Most of that I agree with (living in Central London) but there are other costs that bump up the day to day costs of living in London. Not so much info on the SE, as I don't live there, so have no real opinion.

Think congestion charge for example - I turn left instead of right and bang, 8 quid please. Travel is generally expensive here, although personally I think the tube system is fantastic in London - then again, I don't have to travel in rush hour.

A night out in London will cost me 100 quid plus, it doesn't cost me anything like that when I go out in my home-town.

I can't think where I can drive locally for example where I don't have to pay for parking.

One thing that's often forgotten with high earners too, is that they often don't get fixed monthly salaries. In some respects cash flow can be more important, and make you feel wealthier, than not really having your payment schedule settled.

My life would be incredibly easier if I got paid say the 1st of every month, rather than on project delivery every 2-4 months for example. You take on risk and your rewards can increase dramatically, but of course you have that risk to mitigate.

It's like anything really - you experience something then you tend to have a slightly differing view of when not experienced in it. Personally, I think the 50% rate is nothing more than a comical bit of marketing to say to people 'look, we're cracking down on high earners', where as the truth of the matter is it's had little effect. Most people in that position can easily avoid it (not all of course), and often that avoidance can result in a drop in income for HMRCE, not an increase.

Getting paid gross too can make you appreciate what you're paying in tax/NI etc. as you receive all the money in the first place. Then in January & mid-year you have to send of chunks to HMRCE. When I was an employee I never used to bother looking at the tax bit simply because it didn't feel like 'my' or 'real' money, now I pay it after the fact, well it does feel like real money.

 

[Rich_L]

London is more expensive because there are so many more opportunities to go out and spend money

 

[MacRS4]

Ha, yeah, that's true enough I guess. Everytime I step outside I seem to hemorrhage money one way or the other.

 

[MacRS4]

Incidentally, I do find some of the vitriol toward avoidance interesting (not necessarily on here, just in general). Look at it another way, not structuring your affairs to minimise your tax exposure is.....just paying more tax than you need to.

I suppose there's more aggressive ways out there that are borderline illegal, and I can understand those being frown on...But if they're 'borderline' illegal, they may turn out to be legal too?

A lot of people (again, not necessarily on here, just from general discussion) do seem to have avoidance and evasion mixed up too, when they are fundamentally different things. Sure, some aggressive avoidance schemes get turned over by HMRCE through the courts making them evasion - in which case the tax is then due on the original amounts, and penalties too.

 

[scorza]

Incidentally, I do find some of the vitriol toward avoidance interesting (not necessarily on here, just in general). Look at it another way, not structuring your affairs to minimise your tax exposure is.....just paying more tax than you need to.

I suppose there's more aggressive ways out there that are borderline illegal, and I can understand those being frown on...But if they're 'borderline' illegal, they may turn out to be legal too?

A lot of people (again, not necessarily on here, just from general discussion) do seem to have avoidance and evasion mixed up too, when they are fundamentally different things. Sure, some aggressive avoidance schemes get turned over by HMRCE through the courts making them evasion - in which case the tax is then due on the original amounts, and penalties too.

Sigh - no I don't think people are getting evasion and avoidance mixed up. Just because something is not illegal does not make it right. It's not like all avoidance is the same either - there's a world of difference between avoiding tax by having a cash ISA and a UK company making profit from its operations in the UK but then shifting it to a tax haven to avoid paying UK tax rates. There was a report that Osborne was going to introduce a General Anti-Avoidance Rule (GAAR) in this budget. Something which I think it long overdue, let's hope it works.

 

[MacRS4]

Like I say, maybe not on here, but I do think a lot of people don't understand the difference.

As to something being right or wrong, that's what the law is there for. If it's wrong then legislate for it. I'd be ok with general avoidance legislation. The problem this has of course is that the best tax accountants are going to work in the private sector aren't they, rather than structuring tax law? That's a question that last bit rather than a statement.

As for companies moving off-shore, there's another question - why structure your tax system so that companies want to go off-shore? Isn't that in a way saying that our tax system doesn't encourage multi-nationals to stay here?

 

[-Ad-]

You have no idea, then.

I'll let those who complain...complain, and will spend my time furthering my career and getting the most I can in terms of job satisfaction, salary and benefits, and pay as little tax as I can legally get away with!

No point in worrying or caring about those bitter about their situation and harping on about how they consider what I/you earn a lot of money. We all have a different life and it's not up to others to tell me/you how to look at life/salary etc.

Back to the grindstone!

 

[Greebo]

Incidentally, I do find some of the vitriol toward avoidance interesting (not necessarily on here, just in general). Look at it another way, not structuring your affairs to minimise your tax exposure is.....just paying more tax than you need to.

I suppose there's more aggressive ways out there that are borderline illegal, and I can understand those being frown on...But if they're 'borderline' illegal, they may turn out to be legal too?

A lot of people (again, not necessarily on here, just from general discussion) do seem to have avoidance and evasion mixed up too, when they are fundamentally different things. Sure, some aggressive avoidance schemes get turned over by HMRCE through the courts making them evasion - in which case the tax is then due on the original amounts, and penalties too.

I think the issue is that the vast majority of normal people cannot do anything about how much tax they pay as they are just taxed through PAYE.

Only when self employed and very high earners can take advantage of avoidance to reduce their tax bill.

The fact is, whatever the higher rate of tax is, most high earners pay less as a percentage than normal PAYE people.

My gf paid only £9,000 on £74k of gross earnings last year and I know several business owners whose tax bill is only between 10 and 20% each year.

 

[MoRT489]

And although I agree that it costs a lot more to live down south where most of the top bracket earners no doubt live, earning over £150,000 per annum is a lot of money, wherever you live.

It is a lot, I'm not denying that, but just because it is a lot isn't a good reason to have to give more of it away for services the person will never use and for things he/she doesn't believe work.

so its more stressful to work 'slightly longer hours' (i say that as ive never met a company director/owner who works longer hours than any fulltime member of staff) also remember the lovely director loans, average extra MONTH holiday most employers offer to directors. OVER the fact that many lower bracket earners get stress about trivial things like rent/mortgage and worrying if they can afford food.

i also see many directors/senior managers offloading stress onto minions who earn nowhere near that. often a company director's PA has a much more stressful life than the director.

Directors have a multitude of liabilities (both cirminal and civil) which they need to bear in mind when running a business and i'm sure are more stressful. As you move up through the ranks responsibilities increase as does stress and workload, if you are successful/devoted enough to reach the top and can start to manage your work life balance a bit better, well that is the capitalist dream isn't it? People who inherit or otherwise unfairly obtain such position are a different matter, but if you've worked for it then it is surely deserved?

i call your bluff.

Sorry for not providing proof, I'm not about to research it, but IMO and experience it is always more expensive to eat, drink and socialise in and around London than elsewhere in the UK, even the towns just outside London.

My gf paid only £9,000 on £74k of gross earnings last year and I know several business owners whose tax bill is only between 10 and 20% each year.

How? Self-employed non-dom?

 

[George Hincapie]

There is only so much money you 'need', the rest is superfluous.

That isn't for you to decide. There's nothing funny about getting a good salary and losing half of it. There's nothing funny about getting a good bonus and losing half of it. I have no issue with supporting those genuinely in need, but I pay a stupid amount of tax and it makes me sick quite frankly.

The tax policy in this country is insane - there should be a flat rate of tax which everyone pays. You shouldn't pay a higher percentage just because you earn more.

 

[Greebo]

How? Self-employed non-dom?

Self employed, generous VAT flat rate schemes, good tax advice, much more generous expenses than a PAYE employee, etc

TBH, in 20+ years of been an accountant I have yet to come across a business owner or self employed person where their total tax liability was above 30%.

 

[scorza]

That isn't for you to decide. There's nothing funny about getting a good salary and losing half of it. There's nothing funny about getting a good bonus and losing half of it. I have no issue with supporting those genuinely in need, but I pay a stupid amount of tax and it makes me sick quite frankly.

There's even less funny with earning a low salary and losing a third of it.

The tax policy in this country is insane - there should be a flat rate of tax which everyone pays. You shouldn't pay a higher percentage just because you earn more.

And yet almost every developed country I can think of has a progressive income tax regime, the most progressive of all are the ones with the lowest income inequality. Coincidence?

 

[MoRT489]

Self employed, generous VAT flat rate schemes, good tax advice, much more generous expenses than a PAYE employee, etc

TBH, in 20+ years of been an accountant I have yet to come across a business owner or self employed person where their total tax liability was above 30%.

Interesting stuff. If you can estimate it, how much would you say decent tax structuring advice would cost the average self-employed person per year?

 

[BlackDragon]

That isn't for you to decide. There's nothing funny about getting a good salary and losing half of it. There's nothing funny about getting a good bonus and losing half of it. I have no issue with supporting those genuinely in need, but I pay a stupid amount of tax and it makes me sick quite frankly.

The tax policy in this country is insane - there should be a flat rate of tax which everyone pays. You shouldn't pay a higher percentage just because you earn more.

+1

Many of the high earners (any body in the 40% tax band and above) are people that have worked hard to have reached their level of pay, and to then have to pay a higher percentage of tax almost makes it feel like you're being unfairly penalised.

 

[George Hincapie]

There's even less funny with earning a low salary and losing a third of it.

So get a better job? Your financial security isn't my responsibility.

And yet almost every developed country I can think of has a progressive income tax regime, the most progressive of all are the ones with the lowest income inequality. Coincidence?

I don't care for equality. It's incumbent on each of us to earn as best we can. You shouldn't expect others to fund you and your feral children because you're too stupid to earn a decent wage.

 

[George Hincapie]

+1

Many of the high earners are people that have worked hard to have reached a their level of pay, and to then have to pay a higher percentage of tax almost makes it feel like you're being unfairly penalised.

Indeed, something the great unwashed struggle to grasp. There's almost no incentive to strive for success.

 

[clartymarty]

no

 

[scorza]

Indeed, something the great unwashed struggle to grasp. There's almost no incentive to strive for success.

Complete nonsense, people still strived for success when the top rate of income tax was 60% prior to 1988. The 50% tax rate was the first meaningful increase in a long, long time. If people have a problem with that tax rate, volunteer to take a pay cut so you're not affected by it. Of course no-one actually would because there's still a massive incentive to earn more.

 

[Freakbro]

I don't care for equality. It's incumbent on each of us to earn as best we can. You shouldn't expect others to fund you and your feral children because you're too stupid to earn a decent wage.

Oh dear oh dear...

I really don't know how to answer that ignorant post without insulting you.

Indeed, something the great unwashed struggle to grasp. There's almost no incentive to strive for success.

Hahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahaha...

"OMG, I really dont want to earn more than £150,000 a year ...because even though I will still get more money I will be getting 10p in every pound less than I was!!111!!111"

 

[George Hincapie]

Oh dear oh dear...

I really don't know how to answer that ignorant post without insulting you.

Then don't try. It would be ignored in any event.

Hahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahahaha...

"OMG, I really dont want to earn more than £150,000 a year ...because even though I will still get more money I will be getting 10p in every pound less than I was!!111!!111"

If you are ever in that position then you may feel differently.