MSE News: Isa limits to stay, says Treasury financial secretary

JimmyTheWig

Lokolo wrote: »

I believe it's not based on family earnings, but based on 1 person earning over that.

So you can have 2x£39k and still get CB?

This is what I read in other posts anyway...

Yes, you are right. But if one parent doesn't work in order to look after the children then the limit is 44k. They certainly wouldn't be able to afford to put £10k into savings in a year.

bendix

JimmyTheWig wrote: »

Yes, you are right. But if one parent doesn't work in order to look after the children then the limit is 44k. They certainly wouldn't be able to afford to put £10k into savings in a year.

Yes, and if my auntie jean had a d**k she'd be my uncle john.

Blah blah blah. Get over it. CB is on its way out for people paying high tax. And there's much more to come :-)

JimmyTheWig

My point is that they said they were doing the child benefit changes because higher earners should be making more contribution. I'm saying that reducing the ISA annual limit would have been a much fairer way of doing it.

Lokolo

JimmyTheWig wrote: »

My point is that they said they were doing the child benefit changes because higher earners should be making more contribution. I'm saying that reducing the ISA annual limit would have been a much fairer way of doing it.

Hm but the only savings made would be 20% of the interest of the difference.

So for a mum and dad, £10,200 -> £5,100 (say they halve the ISA limit for examples sake).

So the parents lose out on £5,100 of ISA.

Say 3%. £5,100 is £153.

-20% and this is what the goverment is actually losing out on, means £30 for 2 people a year.

If I have explained it well enough for others to understand. This is hardly a massive saving compared to CB? (Although I don't know how much CB is, I'm sure its more than £30 a year)

miller

triplea35 wrote: »

Cash ISA's are virtually worthless to anyone other than higher rate tax payers. You can get better rates 'net of tax'. The only people profiting from ISA's are the Banks.

Its true, there have been cases where banks have been paying different rates on equivalent types of account.

Despite being a benefit, ISA's really hack me off in terms of administration. It would be great if they were as easy to transfer like taxable accounts.

bendix

JimmyTheWig wrote: »

My point is that they said they were doing the child benefit changes because higher earners should be making more contribution. I'm saying that reducing the ISA annual limit would have been a much fairer way of doing it.

Yes, because recouping the tax foregone on 3% interest of whatever the reduced ISA allowance would be will make a massive difference to tax coffers, compared to not giving spoilt middle class kids of high tax rate parents £1000+ a year that's not needed.

How hard is it to think these things through? Seriously.

JimmyTheWig

I take the point that this wouldn't have generated much.
But if we're "all in this together" then this seems like an easy cut to make that won't hurt many people.

And remember that the government saving would be just over double that next year, etc.

chedburgh

JimmyTheWig wrote: »

I take the point that this wouldn't have generated much.
But if we're "all in this together" then this seems like an easy cut to make that won't hurt many people.

And remember that the government saving would be just over double that next year, etc.

I dont see how cutting payments to well off middle class families will hurt them? Why the money is going to them and not the less well off is really what puzzles me.

michaels

Surely it would be more sensible to have added a lifetime cap on the (net) amount that could be paid in to ISAs?

ultrawomble

JimmyTheWig wrote: »

But if one parent doesn't work in order to look after the children then the limit is 44k. They certainly wouldn't be able to afford to put £10k into savings in a year.

Why not? We do on less. A rough estimate of £44K gives about £2500/month after tax etc. Save £900/month and you're left with £1600/month = quite a bit to live on.