Earning over £100,000 a year and can't get a mortgage?

Dithering_Dad

BobProperty wrote: »

DD, you outside IR35?

Hi Bob, sorry I missed this post. Yes, I'm outside IR35. I pay £150 to have each contract reviewed and also pay insurance cover for legal costs if the Revenue decide to carry out an IR35 audit on my business.

I generally have contracts that last 6 - 9 months and I haven't used the same agency twice (not yet anyway). The contracts range from Yorkshire, Denmark, London, France so I can't see the Revenue making disguised employment stick.

The IR35 legislation is a mess though and needs sorting out. Either the government includes share dividends as income and Tax / NI it accordingly or they should accept the tax loop hole of low wages and high dividends.

Most contractors I know would welcome a reform rather than the current lottery. The thing that most people conveniently forget is that if we pay ourselves 100% by paye, we also have to pay 12.8% NI employers rate (which is not capped like employee NI) as well as employees NI.

This means that we will pay more tax than PAYE people. Which is also unfair, but I'd imagine the bleeding hearts on this thread would not complain as loudly about us paying more tax than they have about us paying less...

Dithering_Dad

neverdespairgirl wrote: »

I think he lives in a studio in Hoxton, from other posts. I could be wrong.

I live in a rented studio in Hoxton during the week when I'm working at my client's site and visit the family home in Manchester at the weekends and holidays. We have one car (Toyota corolla) and live on the same income I had prior to going contracting. The rest of the money is put away onto the mortgage to pay this down to reduce our outgoings.

I'd imagine the bloke who did the 'big man' comment has a far more visibly ostentatious lifestyle than I have. I'm more interested in laying down a solid financial foundation for my family than buying flash toys like expensive cars and other accoutrements.

mlmoneysaver

Dithering_Dad wrote: »

...accoutrements.

Great word

BobProperty

Dithering_Dad wrote: »

The IR35 legislation is a mess though and needs sorting out. Either the government includes share dividends as income and Tax / NI it accordingly or they should accept the tax loop hole of low wages and high dividends.

As I pointed out earlier, this came about for historic reasons because the government/taxman could not accept that you could be self employed and work through an agency. Possibly my current industry (Building) "caused" it from the days of the "lump" in the 70s. Equally, no one in government or the revenue had allowed for such an industry (or rather both industries, IT and Engineering) to develop to the extent that it had so many "freelancers" in it. I can remember some contractors in the early 80's being SE and having Inland Revenue sub contractor cards to prove it. The solution is to accept SE "professionals" working through agencies, but I doubt the revenue or government will go that way because they will one, look stupid for the ways they tried over the last 30 years, and two, they will suspect they will lose out on the deal. So long as that continues, contractors will use limited companies. I'm also waiting for the case when someone is deemed so blatently inside IR35 that they in turn sue their "employer" for sick pay, maternity leave, pension rights etc. Especially when they could be a government department or local authority.

JanCee

neverdespairgirl wrote: »

.

And though I have the gift of prophecy, and understand all mysteries, and all knowledge; and though I have all faith, so that I could remove mountains, and have not charity, I am nothing.

Thats rather appropriate for some of the prophets on here.

Scousebird_2

dudleyboy wrote: »

Are you a bailiff?

LOL!! This is true!! Bailiffs are probably rubbing their hands with glee at our misery!!!
How sad!!
There's always my 6 trusty numbers on Saturday night...surely it's my turn now???

mewbie_2

Dithering_Dad wrote: »

some really sensible stuff

I was checkign your sig, and it looks like you are paying off your mortgage faster than your house is dropping in value. That's some going!!

Well done.

neverdespairgirl

Dithering_Dad wrote: »

I live in a rented studio in Hoxton during the week when I'm working at my client's site and visit the family home in Manchester at the weekends and holidays. We have one car (Toyota corolla) and live on the same income I had prior to going contracting. The rest of the money is put away onto the mortgage to pay this down to reduce our outgoings.

I'd imagine the bloke who did the 'big man' comment has a far more visibly ostentatious lifestyle than I have. I'm more interested in laying down a solid financial foundation for my family than buying flash toys like expensive cars and other accoutrements.

It must be pretty hard being away from the family so much, for all of you.

We have one car too - and we are thinking of getting rid of it. We use it very little, and it might well work out cheaper just to hire one when we want to drive. We cycle, walk, and take public transport, most of the time.

I'm not interested in status toys either. Can't be bothered with them. If someone thinks less of me for having a 10 year old Fiat, that's a nice, handy way of getting rid of a pillock.

Dithering_Dad

mewbie wrote: »

I was checkign your sig, and it looks like you are paying off your mortgage faster than your house is dropping in value. That's some going!!

Well done.

lol, I'm not sure whether this is a mickey take, given our past, but I'll take it as a compliment. I've never actually been concerned with how much my house is worth. All I care about really is how much my mortgage is and how much it costs me each month to service the mortgage debt. I'm doing my level best to reduce both.

We're already feeling the benefit. My original mortgage was over £1000 per month and by making overpayments, I've now reduced it to £790 (and that include 2 rate rises). The extra £300 per month goes into my wife's stakeholder (she doesn't have any other pension as she is a SAHM).

neverdespairgirl wrote: »

It must be pretty hard being away from the family so much, for all of you.

We have one car too - and we are thinking of getting rid of it. We use it very little, and it might well work out cheaper just to hire one when we want to drive. We cycle, walk, and take public transport, most of the time.

I'm not interested in status toys either. Can't be bothered with them. If someone thinks less of me for having a 10 year old Fiat, that's a nice, handy way of getting rid of a pillock.

It's really hard, I used to have a government 'joe job' where I was home every night and my wife worked as a teacher. Then our disabled daughter was born and so my missus had to give up work to take care of her and I had to go contracting to 'make up the difference' and try to earn both our previous salaries.

The whole Mortgage Free in Three thing is to reduce our outgoings to the point where I can return to a normal job and stop being a weekend husband/father. I reckon I have about 3 more years to go. :undecided

It's interesting with the discussion on tax, because a working couple receive 2x£5000 tax free allowances and combined they can earn upto £80k before they pay high rate tax. If your wife stays at home with the kids, and you increase your pay to compensate you end up losing out big time to tax. The goverment should scrap tax credits and just allow couples to share their tax allowances and thresholds.

boinging_2

Dithering_Dad wrote: »

I'd imagine the bloke who did the 'big man' comment has a far more visibly ostentatious lifestyle than I have. I'm more interested in laying down a solid financial foundation for my family than buying flash toys like expensive cars and other accoutrements.

You have a very wild imagination.

The point I was making was that you could have made exactly the same point on your original post by posting %'s rather laying out exactly what you earn. I doubt you would have done this if you had been earning £18k a year.

Fair play to you for getting off your derriere and earning a decent living. In our differing ways we are the same, but I chose not to shout about it.