Possible Tax Cuts on the way

neverdespairgirl

mitchaa wrote: »

The maximum taxation in this country is 41% (40%+1% N.I) however because of the P.A and B-R of tax, not 1 person in the country will be paying anymore than 40% of their gross salary in taxation.

More if you are self-employed. NI is more than 1% as there is no employer's contribution.

neverdespairgirl

I think there is evidence of significant mortgage fraud over the last few years. Inevitably, skeletons come tumbling out of closets during a recession.

More than £22m worth of fraud in 12 cases reached Scottish courts in the last six months, figures show.
Accountancy firm KPMG warned that the statistics are likely to get worse as the full impact of the credit crunch sets in.
The figures compare with £2.7m worth of fraud brought to the courts in seven cases in the same period last year.
KMPG said banks were increasingly becoming a target, with mortgage fraud starting to make an impact.

http://news.bbc.co.uk/1/hi/scotland/7530018.stm

Mr Kirk said a great deal of fraud was now taking place in the banking sector and through "boiler room" investment schemes selling worthless shares.
"Mortgage fraud has come back with a vengeance because of the credit crunch and organised crime is moving into mortgage fraud," he added.

http://news.bbc.co.uk/1/hi/uk/7611288.stm

The FSA's call for tougher defences against fraud is targeted at the whole mortgage industry, including the British Bankers' Association (BBA) and the Council of Mortgage Lenders (CML).
The regulator says the problem has become widespread in recent years because of "easy credit conditions and streamlined application processes."

http://news.bbc.co.uk/1/hi/business/7519100.stm

A mortgage broker who submitted false mortgage applications to lenders has been banned for life by the Financial Services Authority (FSA).
Omotayo Fawole who ran Oasis Mortgage and Financial Services, in Woolwich in South East London was also fined £100,000 by the city watchdog.
So far this year the regulator has taken similar action against 17 other brokers, mainly in London.
Mr Fawole's actions were described as "serious and blatant", the FSA said.
"He poses an immediate risk to lenders, " added Margaret Cole of the watchdog.

http://news.bbc.co.uk/1/hi/business/7553847.stm

Philip Robinson, director of financial crime and intelligence at the FSA, says mortgage fraud is a "serious and widespread problem".
How widespread? Well, that depends on who you listen to.
The Association of Chief Police Officers (Acpo) puts losses from reported cases at £700m a year, and growing. Lenders dispute that estimate, claiming it includes some double-counting.
And Jonathan Phelan, the man who heads the FSA's team of investigators, says he just doesn't know.



http://news.bbc.co.uk/1/hi/business/7521601.stm

drbeat

Dan: wrote: »

I have never seen a useful/factual post from you. All you seem to do is troll for spelling errors.

and I thought !!!!!!? had a sad life.

C'mon now Dan:, you're made of better stuff.

StevieJ

neverdespairgirl wrote: »

I think there is evidence of significant mortgage fraud over the last few years. Inevitably, skeletons come tumbling out of closets during a recession.

Here is a interesting article (if you bears can ignore where it came from)

http://www.estateagencynews.co.uk/news/news-0408e.asp

I co-authored a `Mortgage Fraud’ Report, commissioned in 1989, which found that over one mortgage in eight was to an extent fraudulent.

Looks like they were at it even back then.

Another interesting fact? about the 70's a 10% deposit was a months wages/salary.

neverdespairgirl

Bloody hell, that's high - thanks for posting it, very interesting.

StevieJ

neverdespairgirl wrote: »

<sticks neck out>

I do. And I don't think, myself, that £41k is a wealthy income, particularly if you live in London and / or have children.

I was only joking because he wanted tax increases for the better paid, but not starting at 41k :rotfl:(I know it is the marginal HR but still)

StevieJ

neverdespairgirl wrote: »

Bloody hell, that's high - thanks for posting it, very interesting.

There is another irony, he mentions Lawson and his partly scrapping MIRAS but giving a warning, he says something about us learning our lesson and not doing it again.
Over to you DARLING and the proposed tax concessions.:T

lostinrates

mitchaa wrote: »

The maximum taxation in this country is 41% (40%+1% N.I) however because of the P.A and B-R of tax, not 1 person in the country will be paying anymore than 40% of their gross salary in taxation. In some european countries, 50% is the norm (Netherlands for example)

I feel there is room for the government to play around with higher rate taxation in order to cut the BR of tax for the majorities.

I think Its important to clarify that maximum taxation is not 41% but rather maximum INCOME taxation is 41% (or not if you are self employed, NDG;) ). Over all a much highr percentage of expenditure goes in tax too.

mitchaa

neverdespairgirl wrote: »

More if you are self-employed. NI is more than 1% as there is no employer's contribution.

Yes but not quite sure if that is true or not in respects to my statement that no-one in the country is paying more than 41% of their gross in direct taxation. Particularly in the SE industry where ''tax evasion'' is key.

Being SE allows you to offset everyday expenses from your gross to stop you paying excessive tax. I would be majorly surprised if your taxation contributions are more than 41% of your gross NDG, i would be surprised if anyones contributions were for that matter

If they are you need an accountant;)

There's a chap i work with who earned over £100k last year but paid less tax than what i did with 07/08 PAYE earnings of £45k.

A £50k PAYE salary will pay £35,470 after both IT and NIC meaning the tax burden is 'only' 29.06% of this gross salary.

A £100k PAYE salary will pay £64,790 after both IT and NIC meaning the tax burden is 'only' 35.21% of this gross salary.

A £200k PAYE salary will pay £123,970 after both IT and NIC meaning the tax burden is 'only' 38.01% of this gross salary

www.thesalarycalculator.co.uk

To have a true 40% taxation contribution, you would need to be earning in the region of £600k pa and as i stated you would never be able to have a 41% contribution.

To me i think this is too low for the super wealthy and should be addressed to help those lower down with taxation cuts in the BR.

PasturesNew

mitchaa wrote: »

£41k is where the 40% threshold is currently set.

I thought it was £34,800

http://www.hmrc.gov.uk/rates/it.htm

mitchaa wrote: »

I do pay part of my salary at the 40% rate yes but i wouldn't say i had a high income. More of a middle rate income. I still watch my pennies just like someone would do on half my salary.

Most people who are paid well don't think they are. Half your salary is still more than most everyday people earn. £15-18k is a good salary to a huge chunk of people.

mitchaa wrote: »

The maximum taxation in this country is 41% (40%+1% N.I) however because of the P.A and B-R of tax, not 1 person in the country will be paying anymore than 40% of their gross salary in taxation. In some european countries, 50% is the norm (Netherlands for example)

I am currently looking for work. To earn more than about £15k in most areas I will have to go contracting in my specialism. When contracting I pay:
- an umbrella company to sort out the tax/paye
- B&B/hotels for 4 nights a week closer to the job
- the tax at whatever rate
- employee's NI, which drops to 1%
- employer's NI, which does NOT drop to 1% but stays at 10%
- my own holiday pay (10%?)

If I can get a job right on my doorstep (no travel/hotel required), starting at a rate of £25/hour, which sounds like a very healthy £40,000/year, keeping it simple, I'd be paying out:
20% tax
10% employer's NI
10% employee's NI
10% towards my own holiday pay (which I do get back, taxed)

If I go over the 40% tax threshold, the figures are then:
40% tax
10% employer's NI
10% employee's NI
10% holiday pay (which I do get back)

---

70% taken from the wage packet each week/month. Certainly 60% tax

If you're sitting next to a contractor at work, they might not be on the huge earnings you'd assume if you'd seen the agency invoice.

Now, on these higher rates of pay, it does bring in a good takehome, but I have actually seen contracting jobs at £7-12/hour, where the sums just don't add up!

I will admit that contracting is a choice (or sorts) and there can be tax advantages and one can set up a Ltd company and work through that. But I am pointing out an instance where a worker can be paying more than 40% tax. And increasingly work that needs to be done is being put out to contractors and the self-employed as the employer has no commitment to them then.