Tax in UK

Mrwong said:
100k is not a rich wage these days.
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I really beg to differ on that........... its not AS rich a salary as it used to be......... and it is less rich a salary in london than elsewhere....

but i earn well under half of that, and where i live is not cheap either (not far from Cambridge) and i have a comfortable life style.

someone mentioned having 4 kids and a wife.......... i would say in the modern world if you want to have 4 kids then that is a choice you make........... This probably isnt the thread to go down that rabbit hole.... but I would suggest that in most relationships these days in the modern world, both parties can be expected to be earners...... not just the man.

we have 1 lad and both my wife and i do our bit for child care equally and make use of after school clubs and holiday clubs so we can both work.
 
delta0 said:
Considering that started in 2005 that would be equivalent to £170k today ignoring adjustments for tax which would take it even higher.
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People are fixated on 100k because it looks like a big number.

The OP's friend wanting to move to Oz for tax reasons I hope he is offered more than $100k AUS as that's not as good as 100k over here.

His friend might as well stay in the UK and just to the pension contribution or cycle to work scheme to lower his tax footprint.
 
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aspiring said:
Yeah spot on. 100k is a gigantic wage in current times.

Remember when Alan sugar used to offer 100k salaries to his winner on apprentice.
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Gigantic wage, i beg to differ. 100K salaries make life easier with holidays, monthly bills etc. However, it does not offer a lavish lifestyle.

You also get very quickly acclimatised to a wage and wonder how you managed previously. Items, possession etc become relative.

Lots of posts are fixated on this 100K being lifechanging (it really isn't). As soon as people get to 100K; you push for 150.... and so on.
 
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kai said:
Lots of posts are fixated on this 100K being lifechanging (it really isn't). As soon as people get to 100K; you push for 150.... and so on.
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How do people saying this rationalise the fact that a £100k salary represents the top 3-4%?

£100k would absolutely be life changing for most people.

A one off £100k would be life changing for most people, let alone as a yearly salary.
 
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bigmike20vt said:
I really beg to differ on that........... its not AS rich a salary as it used to be......... and it is less rich a salary in london than elsewhere....

but i earn well under half of that, and where i live is not cheap either (not far from Cambridge) and i have a comfortable life style.

someone mentioned having 4 kids and a wife.......... i would say in the modern world if you want to have 4 kids then that is a choice you make........... This probably isnt the thread to go down that rabbit hole.... but I would suggest that in most relationships these days in the modern world, both parties can be expected to be earners...... not just the man.

we have 1 lad and both my wife and i do our bit for child care equally and make use of after school clubs and holiday clubs so we can both work.
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This is so true.

100K is super comfortable. It is strange that people seem to think otherwise especially in current climate of economy downturn.

If you are living not far from Cambridge on around 50k etc then that is pretty damn good
 
Rai200 said:
How do people saying this rationalise the fact that a £100k salary represents the top 3-4%?

£100k would absolutely be life changing for most people.

A one off £100k would be life changing for most people, let alone as a yearly salary.
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yeah and there must be a reason that only 3-4% of the ENTIRE UK population earn that?

100k would cover everything well if you save and not waste money. Hell even 80k would easily give you a nice standard.
 
Freefaller said:
I'd rather have a 100k one off right now than be on a 100k salary.
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Yeah? I bet you're on a wage not that far off of £100k.

For most people a 100k wage is a yearly take home increase of £40,000 (£27-28k avg vs 67k). A sensible, average earner is 100% taking the salary.
 
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Rai200 said:
Yeah? I bet you're on a wage not that far off of £100k.

For most people a 100k wage is a yearly take home increase of £40,000 (£27-28k avg vs 67k). A sensible, average earner is 100% taking the salary.
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I'm not one to willy wage or disclose my salary, but regardless, 100k in 1 lump sum tax free, is far more appealing that 100k for a few years.
 
Freefaller said:
I'm not one to willy wage or disclose my salary, but regardless, 100k in 1 lump sum tax free, is far more appealing that 100k for a few years.
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What if the option was £100k lump sum or £40k a year tax free (on top of your normal earnings) for perpetuity? Because the latter is what it represents to most people.
 
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aspiring said:
yeah and there must be a reason that only 3-4% of the ENTIRE UK population earn that?

100k would cover everything well if you save and not waste money. Hell even 80k would easily give you a nice standard.
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Again, it comes down to circumstances. As you earn more your life decisions change.

If people who earned more kept to their £40-50k year lifestyle, then yes they'd suddenly have a huge amount of disposable income. However, the point of earning more is to be able to afford better things, or overpay your mortgage, invest it, treat the family more etc... Regardless which route you take 100k actually just changes your lifestyle subtly over a period of time. You buy a coffee for colleagues, you decide to take the car more than cycle/train, you buy lunch at work rather than preparing it at home, you increase your child's childcare attendance, or you buy a better quality car seat etc... all these things clock up and erodes the "huge" amount of money you have.

Again, you're not going to be struggling to pay the bills, I don't think anyone suggested that, but you don't suddenly start eating caviar and sipping on champagne every day when you break 6 figures.
 
People seem to focus on the salary amount but give no thought to outgoings. It's entirely possible for someone's family circumstances to mean that even though they earn a higher salary then are worse off at the end of the day (money left over after outgoings) than someone on a lesser salary.
Also worth bearing in mind how unnecessarily complex our tax system is and how nasty things like the personal allowance being taken away over £100k makes for a crappy 60% tax rate.
 
Moley said:
People seem to focus on the salary amount but give no thought to outgoings. It's entirely possible for someone's family circumstances to mean that even though they earn a higher salary then are worse off at the end of the day (money left over after outgoings) than someone on a lesser salary.
Also worth bearing in mind how unnecessarily complex our tax system is and how nasty things like the personal allowance being taken away over £100k makes for a crappy 60% tax rate.
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Indeed - but apparently 100k is a magic figure that solves all your financial problems! :D
 
Moley said:
People seem to focus on the salary amount but give no thought to outgoings. It's entirely possible for someone's family circumstances to mean that even though they earn a higher salary then are worse off at the end of the day (money left over after outgoings) than someone on a lesser salary.
Also worth bearing in mind how unnecessarily complex our tax system is and how nasty things like the personal allowance being taken away over £100k makes for a crappy 60% tax rate.
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You seem to have not read the thread at all.

Oh no, a 60% tax rate means I'm only earning 3-4x the minimum wage AFTER tax. Cry me a river.

But you are right, those earning 100-125k shouldn't pay more tax than those making millions. It should be 60% for everything over £100k.
 
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Rai200 said:
What if the option was £100k lump sum or £40k a year tax free (on top of your normal earnings) for perpetuity? Because the latter is what it represents to most people.
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It's not for perpetuity as a job isn't for life necessarily.

Also sure if you look at it over a period of a year it seems impressive, but let's face it, people live on a monthly / weekly basis.

In reality if you suddenly went from 40k to 100k, you'd probably spend some time clearing your debts, and/or putting money aside for a deposit (if you didn't have a house) etc... whilst you'd be able to afford your bills and so on, and save, you're suddenly not afforded a life of luxury buying the latest hardware etc... If that's what you do when you start earning more money before addressing more immediate debts and other life choices then you're probably not mature enough to even be in the position to earn 100k.
 
Freefaller said:
It's not for perpetuity as a job isn't for life necessarily.
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Effectively it is for as long as you decide/need to work. Certainly not a few years as you put it.

Freefaller said:
Also sure if you look at it over a period of a year it seems impressive, but let's face it, people live on a monthly / weekly basis.
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An extra £3,333 a month, about a 148% increase on the average take home pay is quite impressive still.


Freefaller said:
In reality if you suddenly went from 40k to 100k, you'd probably spend some time clearing your debts, and/or putting money aside for a deposit (if you didn't have a house) etc... whilst you'd be able to afford your bills and so on, and save, you're suddenly not afforded a life of luxury buying the latest hardware etc...
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If I had £40k extra a year I'd have £40k extra a year towards a deposit or outright purchase. And, unfortunately buying a house is a luxury for many.

Freefaller said:
If that's what you do when you start earning more money before addressing more immediate debts and other life choices then you're probably not mature enough to even be in the position to earn 100k.
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I'm sorry you've been suckered into living beyond your means, but I'm mature enough not to get into massive debt... even on a lot less than £100k.
 
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Oh I haven't I assure you - my finances are absolutely fine (despite 2 kids!) :)

You're taking too much of a helicopter view on this. However it's clear we're going to disagree, I'm not here to try and convince you either way, I don't have to be right either, I'm not after "winning" the debate, just sharing my perspective as a "high" earner.

Regardless, I wish you all the best in getting to this feverish 100k that you seek, and hope it provides you the comfort you hope it will.
 
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Rai200 said:
How do people saying this rationalise the fact that a £100k salary represents the top 3-4%?

£100k would absolutely be life changing for most people.

A one off £100k would be life changing for most people, let alone as a yearly salary.
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There is two clear distinctions here. You are saying £100k is life changing, yet people who have commented who (perhaps) take home in this range or even more commenting are saying this is actually not the case.

Comfortable and “life changing” are very, very different.

I would also snatch your hand off if someone said here is 100K over a yearly salary.
 
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Freefaller said:
In reality if you suddenly went from 40k to 100k, you'd probably spend some time clearing your debts, and/or putting money aside for a deposit (if you didn't have a house) etc... whilst you'd be able to afford your bills and so on, and save, you're suddenly not afforded a life of luxury buying the latest hardware etc... If that's what you do when you start earning more money before addressing more immediate debts and other life choices then you're probably not mature enough to even be in the position to earn 100k.
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Plenty of people manage to do all of those things on a wage much less than £100k though... if you need £100k to achieve comfort, you're doing something wrong/living beyond your means/made poor life choices/etc.
 
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