Diverting £50k of salary into pension fund to claim welfare benefits

civil12345

Thanks. I'm thinking about this from the point of view of tax credits - I assume they look at your income monthly rather than currently for tax credits where they look at your last years income?

Before reading this I was considering making large pension payments for the next couple of years. I currently pay into a civil service pension and was thinking of opening a SIPP to pay into.

zagfles

civil12345 wrote: »

Thanks. I'm thinking about this from the point of view of tax credits - I assume they look at your income monthly rather than currently for tax credits where they look at your last years income?

Before reading this I was considering making large pension payments for the next couple of years. I currently pay into a civil service pension and was thinking of opening a SIPP to pay into.

Yes I believe with UC they will look at your income every month, so not sure how it'd work if you make pension contributions to a personal scheme.

Tax credits don't just use last year's income, they use a combination of last year's and this year's.

MRB

Just read through the whole thread, as we're looking at ways to adjust our earnings to get us some benefits, etc, to help with a newborn on the way.

Got to say, some people have a bitter attitude on here. If someone is trying to figure out how to bring their salary down to a level where they can earn some HMG benefits, the chances are, unless they're really good, they've already paid tens of thousands (hundreds of thousands?) in tax from their earnings into a society of full-time benefit leeches who have never paid a penny in of their own money.

I say fair play, and as soon as we get our heads round it, if it works, we'll be doing it too. Morally? I'm angrier at people who've never worked yet earn thousands for popping out some sprogs, fibbing to their GP and limping when it suits, and scream: "claim!" because they couldn't see the wet floor sign in front of them.

scholesfan88

If you earn £65k a year then there's no way that you need help from the Government.

The benefits system is there in theory to help people that need it, yes there are some that sponge off the system but the majority have no other option. If you earn £65k a year you do have an option.

Your just as bad as the scum bags that are bleeding the benefits system dry and tbh i hope you start paying all this money into your pension and the goventment stop all the payments you recieve and you find yourself financially in the crap.

gadgetmind

scholesfan88 wrote: »

Your just as bad as the scum bags that are bleeding the benefits system dry

As they will still be very much net contributors to society rather than a drain upon it, I tend to disagree.

However, I do think that our benefits system needs revising such that it's only those who are out of work entirely who get anything and even then it's heavily capped.

It needs to be a short-term safety net rather than a way of life.

I'm pleased to see that moves are being made in this direction, but not fast enough and not far enough.

zagfles

gadgetmind wrote: »

As they will still be very much net contributors to society rather than a drain upon it, I tend to disagree.

However, I do think that our benefits system needs revising such that it's only those who are out of work entirely who get anything and even then it's heavily capped.

It needs to be a short-term safety net rather than a way of life.

I'm pleased to see that moves are being made in this direction, but not fast enough and not far enough.

Moves are not being made in that direction - quite the opposite. The distinction between out of work and in-work benefits is being (mostly) removed.

The whole problem with the current system and the simplistic view that benefits should only be for those who "need" them is that it creates massive marginal withdrawal rates and removes the incentive to work, hence the "lifestyle choice". Why would someone bother working in a low paid boring job that pays only about what they'd get in benefits if they weren't working?

Under UC there's quite a big allowance (amount you can earn without any benefit reduction) followed by a 65% withdrawal rate for those who work, meaning that someone who gets up of their backside and gets a job will (nearly) always be significantly better off than someone who who doesn't.

gadgetmind

zagfles wrote: »

Why would someone bother working in a low paid boring job that pays only about what they'd get in benefits if they weren't working?

A strong work ethic and a desire to get a foot on the ladder.

You could also keep on tapering benefits so the longer someone was on their backside, the less they got. You could perhaps do this by not indexing benefits, or even negatively indexing them, so you'd get less every year in real terms.

zagfles

gadgetmind wrote: »

A strong work ethic and a desire to get a foot on the ladder.

You could also keep on tapering benefits so the longer someone was on their backside, the less they got. You could perhaps do this by not indexing benefits, or even negatively indexing them, so you'd get less every year in real terms.

Sounds a particularly daft idea. DT is usually the place to discuss those, how about leaving this thread to discuss how the system actually works, or will work.

gadgetmind

zagfles wrote: »

Sounds a particularly daft idea.

What most of those on long term benefits actually need is not to have this lifestyle as an option.

DT is usually the place to discuss those, how about leaving this thread to discuss how the system actually works

The current system doesn't work.

atush

Sounds a great idea to me. I grew up in a country where the safety net was just that. Tiny, and you would be poor on it. So you'd do anything to get out of it, and the last thing you would do would be to have
another child.


To have families where 3 generations who haven't worked, with the main family unit with a women with many children with up to 5 different fathers- all on the state is not good for them or the children in question. Nor society.

It hasn't done anyone any good.

I had a financial crisis (to me) when i had twins. It was devastating to us, having already one child under 4 so I was not able to work.

It might not have been one, had I have been living in a country that paid me to have babies at the time. Absolute madness in a purely economic sense.