Income Tax: Do you agree with the Govt’s changes? Poll results/discussion

I will lose £265 per year which will not be made up by tax credits. This hits hard for a two parent working family with a mortgage.

I think they should of increased the personal allowance more to compensate for the loss of the 10% rate. It seems to me those earning lower will be more effected which surely are the ones that need the help.

mcgazz wrote: »

What I don't understand is why almost no one who proposes changing the tax system suggests funding cuts in the income tax rates and/or increases in the personal allowance by increasing the tax on inheritances, "capital gains", share dividends and savings interest to the same level (if not higher) than the tax on wages.

Surely it's better to tax unearned, rather than earned, income?

What about people who are retired and using the interest on their savings to prop up the abysmal state pension we have in this country? Not everyone has a private pension and the interest from savings IS their private pension!

So the Government announce that they will recompense people, and that they're targetting those between the ages of 60~64 and those under 25. So the ones who'll end up worse off are between 25 and 60 and on a low income with no children. Once again, this will adversely affect the disabled and those who care for the disabled. No surprise as there aren't enough disabled people in the country for this party to worry about their votes. Yes, I know other groups will be affected, but wouldn't it be nice to see an increase in one of the disability allowances, too?

No - I don't agree with this move. This party promised they would never increase any rates of income tax and they've finally reneged on that promise (instead of sneaking in new taxes).

If they're really going to recompense those who will be worse off - why not just repeal the change? Isn't that the fairest system? Of course, that means they have to find another way to get our money off us.

Hi

In response to Seh567, I totally sympathise. I know of a lot of people in your situation and I only hope that the 'compensation' the Government is looking to introduce in the autumn will help, but that's a long way off...

In the meantime, looking at your income (which works out at £7008 p/a), you are being taxed on £1573 p/a (tax free allowance £5435). The 10% rate band for 08-09 is £2320, so although you can't use this with your pensions, you can use the balance of £747 (£2320 - £1573) against your interest at the bank.

Your bank will automatically deduct 20% tax from any interest received, so the balance can be claimed back. You will need to wait until the end of the financial year to do this and you can claim on a tax return (if you complete one) or an R40.

Hope this helps!

seh567 wrote: »

As one who is affected it is a disgrace! I am a female pensioner and apart from a reduced government pension of £54 per week I have a small company pension paying £350.00 per month. I've just worked out that after my tax allowance I will be paying double the amount of tax (£29 from £14) for the year 2008/2009 due to the fact I am now paying 20% instead of 10%. I am unable to supplement my pensions with pension credit as I have savings over the allowance threshhold, which I scrimped and scraped to save whilst working to have a better quality of retirement. Seems I have been penalised for being thrifty in the past.

Hi

Just wanted to state that payments made into a pension plan are not taxed, so you do not pay tax twice.

For example, if your employer pays you £1000/month gross and you pay £50 of this into your works pension plan, your employer only taxes you on £950/month. With a private pension, the provider refunds the tax into your pension fund for you.

bigwalnut wrote: »

I also will lose out. I have just started recieving a small pension
and already the Government take half of this. Its disgraceful.
Not only do they tax you while working they then tax you again on the same money you have saved hard for retirement.

I see there all o.k. with their snouts in the trough for their second homes.
As usual in this country there's a law for the rich and a completely different one for the poor.