Capital Gains Tax to increase from 18% to 30%?

kennyboy66_2

Pennywise wrote: »

As for employers NIC, just scrap it as well and increase corporation tax rates to compensate. At a stroke, a major simplification. .

I'd agree with alot of this, but the employers NIC removal just seems unworkable in revenue terms.
Too many employers can avoid corporation tax by structuring their balance sheet. Even the USA has social security tax and medicare tax at a combined 8% (roughly) paid by the employer.

Pennywise

kennyboy66 wrote: »

I'd agree with alot of this, but the employers NIC removal just seems unworkable in revenue terms.
Too many employers can avoid corporation tax by structuring their balance sheet. Even the USA has social security tax and medicare tax at a combined 8% (roughly) paid by the employer.

Of course you are right, but what about firms who engage "self employed" workers instead of putting them on the payroll and the multitude of lower earners who work just below the threshold so neither employee or employer pay employers NIC? If there was no employers NIC, it would stop the disincentive of employing someone (thus paying nic) as opposed to insisting they are self-employed, and so would be good to get more workers back working under a contract of employment, hence benefitting from sick pay, redundancy, maternity, holidays, etc. It's only artificial interference such as employers NIC that has created an entire industry of "pseudo self employed".

StevieJ

Pennywise wrote: »

That's what I've been saying for years.

Gordon Brown messed up badly when he changed the dividend tax rules. Before his changes, a company had to pay 25% tax on the dividends it paid, and the recipient could reclaim that same 25% if they weren't liable to tax. How simple is that - tax is paid and maybe some can be reclaimed.

I don't think that is true, the tax reclaimed on the dividend represents the corporation tax paid by the company not a tax on the dividend payout.

michaels

How about just bundling it all in to income tax and mandating a corresponding increase in salaries to compensate?

kennyboy66 wrote: »

I'd agree with alot of this, but the employers NIC removal just seems unworkable in revenue terms.
Too many employers can avoid corporation tax by structuring their balance sheet. Even the USA has social security tax and medicare tax at a combined 8% (roughly) paid by the employer.

Pennywise

StevieJ wrote: »

I don't think that is true, the tax reclaimed on the dividend represents the corporation tax paid by the company not a tax on the dividend payout.

The company paid 25% "advance corporation tax" (ACT) each quarter according to the dividends paid during that quarter.

At the end of the company's accounting year, it's corporation tax was calculated on the normal rules, i.e. profit made. If it made a healthy profit and had a higher corporation tax liability than already paid in ACT, it had a balance of tax to pay, but if it's taxable profits were less than ACT paid, it couldn't claim a refund and could only carry forward the excess ACT to later accounting years.

zygurat789

kennyboy66 wrote: »

I'd agree with alot of this, but the employers NIC removal just seems unworkable in revenue terms.
Too many employers can avoid corporation tax by structuring their balance sheet. Even the USA has social security tax and medicare tax at a combined 8% (roughly) paid by the employer.

But if it is the right idea, which it is, then make it work properly.
Since the new ruiles came out company owners/directors have paid a lot less tax than the ordinarily employed, and have a good deal on capital gains.

zygurat789

Pennywise wrote: »

That's what I've been saying for years.

As for employers NIC, just scrap it as well and increase corporation tax rates to compensate.

The only fair form of tax is income/corporation tax

neverdespairgirl

Harry_Powell wrote: »

I know that the inland revenue service is creaking under the weight of the complex tax rules labour brought in, especially tax credits.

Tax credits are a total nightmare. A form designed by an idiot, which can only be completed by a genius.

Harry_Powell

neverdespairgirl wrote: »

Tax credits are a total nightmare. A form designed by an idiot, which can only be completed by a genius.

Even if you fill them in right, the revenue will mess up and overpay them. Resulting in loads of families in debt to the government and paying back arrears.

lemonjelly

neverdespairgirl wrote: »

Tax credits are a total nightmare. A form designed by an idiot, which can only be completed by a genius.

Harry_Powell wrote: »

Even if you fill them in right, the revenue will mess up and overpay them. Resulting in loads of families in debt to the government and paying back arrears.

Tax Credits. We only have it because Blair thought he'd copy the Americans. Blair is such a massive FOOL!

The only welfare benefit that we have that doesn't correspond to your actual current circumstances, but is actually based on your income in the previous tax year.

So your income goes down now, you need help now. What happens? They assess your entitlement based upon last year, whilst you had a good income/lots of overtime! Idiotic.

Lets look at it another way. They assess last years income to calculate what you'll get. Then, at the end of the tax year, they'll re-assess your claim. (Brilliant, so already they have to look at every claim at least twice!) Now, most people will get some form of standard of living increase. So their actual award will be based on an income lower than what they will actually get. Result? The majority of people will be overpaid, and therefore will have a debt at the end of the year.

It is idotic. & to my mind, it'll get worse.

HMRC have taken on child benefit. Has anyone tried contacting them? Impossible. Phone lines always busy, & they (in my experience) simply ignore emails (I should say I've given up emailing them).

My take on it, is that there is a grand plan for HMRC to take over the benefits agency in the future. & I do believe it'll happen, as it ha sstarted...

Thing is, HMRC are about collecting money, not paying it out. I feel it is a recipe for disaster.

& then, in a few years, somone will say "lets de-centralize this..." & we'll be back to where we've started, only we'll have spent millions for no reason.