Not good for those paying 40% income tax - £42,375

Rochdale_Pioneers

I'm glad I'm going to pay more tax - I can afford it more than std rate taxpayers can. I'd like to have seen more done from my level upwards to contribute - instead the onus is predicatbly on the poorest who are going to get absolutely hammered.

Generali

mitchaa wrote: »

I thought that too.

I.e... We were all going to benefit from the personal allowance increase but the increase in NI was going to eat that increase up where at the point of higher rate tax, the cost was neutral.

Now it appears, that the cost is not neutral. If you earn £42,375 where the thresholds are going to be aligned you are going to be paying an extra £323.75 in taxation. (£100 IT and £223.75 NIC)

Robbing barstewards kept that 1 quiet.

If you've got a budget that is increasing taxation then by definition there will be losers.

Chris2685

TBH, if I was a higher earner I'd be glad the lower earners aren't being taxed so much. It means they will be less inclined to stop working and go on benefits instead of doing low-paid jobs that no one wants to do.

mitchaa

IveSeenTheLight wrote: »

Mitchaa, you just need to negotiate a higher pay setllement for the year.
That's what I am doing.
Your £323.75 pa increase in tax would be countered by a £809.37 pay increase on £42,375. That's just under a 2% pay rise

We normally get between 3-5% so I agree the inflationary award should swallow this up and leave some change leftover to still call it a pay increase.

Pay freeze last year, FSP scrapped and then a smaller than expected inflation rise this year (3.5%) i think my union needs to pull their finger out and negotiate a better deal for us.

Still, it could have been worse.

drc

IveSeenTheLight wrote: »

Mitchaa, you just need to negotiate a higher pay setllement for the year.
That's what I am doing.
Your £323.75 pa increase in tax would be countered by a £809.37 pay increase on £42,375. That's just under a 2% pay rise

Or form a Ltd Company and pay yourself a very small salary and the rest in dividends which are only taxed at 10% under a certain income limit .

lostinrates

mitchaa wrote: »

We normally get between 3-5% so I agree the inflationary award should swallow this up and leave some change leftover to still call it a pay increase.
....
Still, it could have been worse.

This is pretty much how I feel after running our figures. my guess is the rest of the pay ''increase'' will be swallowed by cost of living rises and fuel etc, but that if all we do is break even or lose a little then we are really doing fairly. I'd rather lose a small amount than be one of the people facing total loss of income etc. I also feel delighted in the opportunities for SMB owners with NI support for first few employees. To me, this investment in business/society is worth paying for, whether I end up employing some one myself or not.

MGCP

I'm expecting it to be announced that pay will be frozen this year (at my level anyway), so I will certainly be worse off. Still, its not as if this is unexpected so we'll just have to take it on the chin.

I'm starting to look at my daily coffee though (£2.05 from the cafe in my building) and think perhaps I don't need it to get me going after all! That should make a decent saving over a year, I can just pretend that anything I save is a pay rise!

IveSeenTheLight

MGCP wrote: »

I'm starting to look at my daily coffee though (£2.05 from the cafe in my building) and think perhaps I don't need it to get me going after all! That should make a decent saving over a year, I can just pretend that anything I save is a pay rise!

Very MSE of you.

For three days worth of paying for someone else to make your coffee, you could probably by a jar, make your own and make it last about 2 months.

A huge saving.


http://www.mysupermarket.co.uk/tesco-price-comparison/Instant_Coffee/Nescafe_Gold_Blend_Coffee_300g.html

Now apply that to all these little luxuries.

I've started cycling to work three days a week.
saves on petrol, wear and tear on the car and improves my fitness

Chris2685

You have only just worked out that paying £2.05 every day for a cup of coffee is not worth it? Assuming you have 1 cup every working day for 48 weeks of the year, you spend nearly £500 on coffee every year... That is 10 weeks shopping budget (even if we do always go over it :P) for me and my family.

Procrastinator333

drc wrote: »

Or form a Ltd Company and pay yourself a very small salary and the rest in dividends which are only taxed at 10% under a certain income limit .

Doesn't work if you are an employee of a single company. Any contractors / consultants who can do this should be doing it already. But for anybody employed by a single employer it isn't applicable.