Tax in UK

The way I see it, 100k is a lot of money still.

If you earn that even as a single earner in a family your doing ok.

At this point anything over 100k should definitely be going into your pension (even more if your a two income household).

Then the tax brackets don’t matter. If you’re taking it as salary you have some serious money problems or like to spend spend spend.
 
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Skynet5 said:
The way I see it, 100k is a lot of money still.

If you earn that even as a single earner in a family your doing ok.

At this point anything over 100k should definitely be going into your pension (even more if your a two income household).

Then the tax brackets don’t matter. If you’re taking it as salary you have some serious money problems.
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So once you hit 100k, your quality of life should gradually decrease with inflation until you retire?
 
OpenToSuggestions said:
I feel the tax in the UK is too high given the way it is incompetently spent and the way it is given away to some since it is a way that does not promote hard work.
I'm firmly middle class and get hit fairly hard for tax given the service I receive back. No kids.

I buy pre-tax shares and put 10% into my pension to keep under the 40% bracket, however due to the tax band freezes I will eventually be hit by hit.
Won't be long until teachers and nurses are in the 40% bracket (and we all know how much they like to complain!).

It does make a mockery of people who actually try to make an effort in this world.
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I don't think anyone would disagree that the taxation is too high here. The problem is that the level of service the public gets for it's money is very poor.
- healthcare is in shambles
- transportation is a mess
- education we're now finding half the school buildings are unsafe
- housing is even worse

All of those need serious amounts of funding to get back to a level of good service, and the only way to achieve that realistically is through higher taxation.
 
Semple said:
I don't think anyone would disagree that the taxation is too high here. The problem is that the level of service the public gets for it's money is very poor.
- healthcare is in shambles
- transportation is a mess
- education we're now finding half the school buildings are unsafe
- housing is even worse

All of those need serious amounts of funding to get back to a level of good service, and the only way to achieve that realistically is through higher taxation.
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Higher government revenues from tax, yes. Higher personal tax rates, no.
 
EvilRob said:
So once you hit 100k, your quality of life should gradually decrease with inflation until you retire?
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Thats a good point. But the older I’m getting I find I have more disposable.

My mortgage is more manageable, I make smarter financial decisions. I buy more expensive stuff that is cheaper as it lasts longer.

As you get older, you have less out goings.
In five years I’ll be mortgage free. So there is £500 I’m better off a month.

In 7 years my kid will have either moved out or be contributing to the household kitty…

I do acknowledge that 100k is worth less now and tax rates should change. But it’s still a lot of money and imo plenty enough, that anything above should be pensioned.
 
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Skynet5 said:
Thats a good point. But the older I’m getting I find I have more disposable.

My mortgage is more manageable, I make smarter financial decisions. I buy more expensive stuff that is cheaper as it lasts longer.

As you get older, you have less out goings.
In five years I’ll be mortgage free. So there is £500 I’m better off a month.

In 7 years my kid will have either moved out or be contributing to the household kitty…

I do acknowledge that 100k is becoming less valuable and tax rates should change. But it’s still a lot of money and imo plenty that anything above should be pensioned.
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Have your outgoings really gone down though or has your income gone up relative to them?
 
EvilRob said:
Higher government revenues from tax, yes. Higher personal tax rates, no.
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Keep raising taxes can't be the answer though.
Almost everything state run is incompetent. Just look at the HS2 car crash.
The NHS is definitely broken, but it doesn't spend money wisely.

Giving Rover millions would have kept them alive, but it doesn't mean it was the right thing to do!
 
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OpenToSuggestions said:
Keep raising taxes can't be the answer though.
Almost everything state run is incompetent. Just look at the HS2 car crash.
The NHS is definitely broken, but it doesn't spend money wisely.

Giving Rover millions would have kept them alive, but it doesn't mean it was the right thing to do!
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Yes, agree raising tax rates can't be the answer; that's what I was alluding to. The economy has to grow and raise more taxes by individuals and business making more and consumer spending increasing. Hard to see how that's going to happen with poor decision after poor decision being made for such a long time though :(
 
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Richie said:
So what happens to the NHS when the people that can afford to "bin off the NHS" given it then becomes a poor person's health service. Just like the USA model really and how does that work out?
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That's the problem at hand. We either end up like the US which is awful or we get a universal health service that is incompetently run, to the point where it can't deliver a full coverage of service.

What's more shocking is my pro labour brother is a Dr and hates the way the NHS is run so much that he'd rather it be fully private.
 
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Skynet5 said:
The way I see it, 100k is a lot of money still.

If you earn that even as a single earner in a family your doing ok.

At this point anything over 100k should definitely be going into your pension (even more if your a two income household).

Then the tax brackets don’t matter. If you’re taking it as salary you have some serious money problems or like to spend spend spend.
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If I was on 125k I would be retired in 15 years with the house paid off and a 1m retirement fund.
That's based on a 5% return so likely sooner.
 
OpenToSuggestions said:
That's the problem at hand. We either end up like the US which is awful or we get a universal health service that is incompetently run, to the point where it can't deliver a full coverage of service.

What's more shocking is my pro labour brother is a Dr and hates the way the NHS is run so much that he'd rather it be fully private.
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Please go search how much the NHS has been underfunded by the Tories since they go in power. Until you do don't complain.
 
OpenToSuggestions said:
…
I'm firmly middle class and get hit fairly hard for tax given the service I receive back. No kids.

I buy pre-tax shares and put 10% into my pension to keep under the 40% bracket, however due to the tax band freezes I will eventually be hit by hit.
….
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a survey in the US results were that over 70% of Americans think they are middle class, personally I don’t think being in the 40% tax bracket (like myself) makes a person middle class. It’s rather a life stye and a mindset, than actual income, asset balance or wealth.

I did ask a friend back when we was kids, what makes a person working/middle/upper class. The way she put it was that the middle class can afford to travel out to a major city to do their shopping, the upperclass can afford to go aboard to do theirs.

personally I think the modern equivalent is now, do you pay for all of your digital services I.e. Netflix, Spotify etc and no longer have “steal” it.

being in the middle class mindset could be finically damaging, thinking that a person needs a certain standard of lifestyle or products… I.e. a new prestige car every 3-5 years to keep up with the jones.

personally I just think that there’s two classes… the working class; do I need to work to live, or have I worked and saved to break this break/retirement and the non working class; people who can stop working tomorrow and maintain the same lifestyle for the rest of their lives. The middle class is a marketing gimmick, to sell middle quality items at a higher price than the basic items.

I 100% agree that this government completely waste money and that the middle pay people are getting squeezed to feed their egos.
 
I'd say there are more than 2 classes.

I definitely feel in the middle.

I absolutely have to work. But I don't have to worry. And that for me elevates me to above working.

I think it would be patronising to say I'm in the same bracket as someone on minimum wage.

But I'm absolutely not in upper class.
 
413x said:
I'd say there are more than 2 classes.

I definitely feel in the middle.

I absolutely have to work. But I don't have to worry. And that for me elevates me to above working.

I think it would be patronising to say I'm in the same bracket as someone on minimum wage.

But I'm absolutely not in upper class.
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I think it’s the middle term itself that gives people the sense of comfort.. middle; average… not egotistic but enough to say that they are not part the bottom.

likewise, if you ask someone how smart they are, most people will say average.

there will always be someone poorer or richer than the next person, someone on minimum wage is nearer to the middle than someone on the dole.. someone one dole is nearer to the middle than a single parent on the dole, etc etc.

I class myself as working class, as i have to work... I could survive a year, if I cut back on everything if I stopped working.. possibly 3 months if I try to maintain the same lifestyle. After that, I would be very worried where the next meal comes from.

likewise, if a person was on the dole and given the right circumstance, they could get themselves into the same financial state after a few months/years.
 
OpenToSuggestions said:
That's the point of the thread really. Tax goes up, but where does it all go?
Feels like it vanishes into thin air.
I can't support the current government either. My post wasn't pro Conservatives.
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Follow the Money: 'Gripping and horrifying... witty and brilliant. Buy it' The Times https://amzn.eu/d/7wfB80m

ive preordered this, it’s a book written by a member of the IMF explaining the UK tax system.
 
The marginal tax rate between 100-125 is the reason that people max out pension contributions/cycle to work/use work car schemes. Normally the car deals work out as expensive, but when you pay pre-tax and save 60+% it can make these deals even sensible financially (particularly electric until the 0 band tax ends).

Although 100+ is a lot, it does make you question taking additional duties/work when you will get paid £1000 and your take home is less than £400 for the added time and responsibility.
 
PikeyPriest said:
Although 100+ is a lot, it does make you question taking additional duties/work when you will get paid £1000 and your take home is less than £400 for the added time and responsibility.
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For sure - it's why wages grow exponentially too IMHO. To make it worth while you need to be clearing the £125k PA reduction comfortably (i.e. a base of at least 125k) and then you anticipate similar bonus levels (~5% to 20%) which puts you substantially over your previous base. There isn't much if any incremental growth post £100k. Just big wallops or go home.
 
PikeyPriest said:
The marginal tax rate between 100-125 is the reason that people max out pension contributions/cycle to work/use work car schemes. Normally the car deals work out as expensive, but when you pay pre-tax and save 60+% it can make these deals even sensible financially (particularly electric until the 0 band tax ends).

Although 100+ is a lot, it does make you question taking additional duties/work when you will get paid £1000 and your take home is less than £400 for the added time and responsibility.
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That's why more bands would be better imo.
Even at 50/40pc I'm questioning... I don't want the promotion if it comes with responsibility increase.

Must be so much worse at 100k
 
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