MSE News: Chancellor: child benefit cut will go ahead

debtaghh

Hi,

I am just wondering if anyone knows how they would work this out, as in would they base it on your actual salary? What if your salary is under the 42k but with overtime which is not guaranteed will bring you over?

Thanks

zagfles

Dorastar wrote: »

Will giftaiding etc actually make any difference - we already giftaid to church and charity and since am £565 over the magic number but combined way under the 80k and set to lose out to the tune of £1600 per year, is this seriously a get out of jail free card? Would prefer to hang on to the CB if possible.

Presumably it is on gross pay too - so pension taken out of wage at source would not make any difference as that is going up 3% if govt has its way = £220 approx loss per month for no real gain tbh - would rather put the £220 on a horse if it would help state coffers! Or does it mean if I contributed to another not work-run pension I could still hang onto it - am confuddled. Maybe I should move out, live round the corner at mums and then dh could claim the CB as he earns a lot less - oh no I remember now I'm actually honest - damn

Giftaid or pension will do. Pensions reduce your gross salary so if you're on the borderline it will take you out of higher rate tax. If you have a personal pension or if you gift aid you need to claim extra relief on your tax return - they'll extend the basic rate band, again taking you out of higher rate tax as long as you contribute enough.

Of course they could put something specific in place to stop this - but that would add even more complication, which they're trying to avoid.

zagfles

debtaghh wrote: »

Hi,

I am just wondering if anyone knows how they would work this out, as in would they base it on your actual salary? What if your salary is under the 42k but with overtime which is not guaranteed will bring you over?

Thanks

It'll be what you actually earn, so overtime would count.

zagfles

clearingout wrote: »

Agreed. But they always have the potential of bringing in a second full-time wage whereas a lone parent is just that - alone!

Yes. The tax system already favours dual earner families over single earner familes, single parent or not. And this will make it worse.

Isn't Universal Credit going to 'force' the second parent into working if they want to claim (assuming the household is below thresholds)? Or have I not understood that correctly? Presumably that's about reducing the welfare bill? If more households have two people in some kind of work, presumably the lower all the benefit bills are going to be and the more money there'll be going into the PAYE pot?!

I don't really get this reform at all.

There've been long threads on this on the benefits boards in recent months. See this one particularly Sixer's posts who explains it quite well

https://forums.moneysavingexpert.com/discussion/3621977

TBeckett100

i am a little tired of taxing the rich argument, and would like to offer a viewpoint.

As a higher rate taxpayer, to fill up 60 quids worth of petrol in my car, i have to earn 100 to pay the tax to net that amount. a basic rate taxpayer has to earn 75 and a non taxpayer 60. simplistic, i know

to pay my mortgage, council tax and basic utilities each month, i have to earn 2383 per month. a basic rate taxpayer 1787. Food costs me 1000 pm wheras a basic taxpayer 750pm on a like for like basis.

so because of my earnings, to live a basic month, i need to earn a lot more to net the same as the guy next door to me.

a few months ago, i had a good month. i grossed 18000 yet netted 10000, yes 8000 went in tax, yet it doesnt matter because i am supposedly rich, i can afford to pay more.

the bbc recently developed a calculator to show what the state gains or loses from us based on tax receipts, turns out i give the state 23k p.a. more than i get back, but thats ok, i am supposed to be rich

rather than pointing the finger at high earners and feel they should be clobbered, we already do. we seem to get sneered at, yet those who are sneering probably are having their annual cost subsidised.

when i get ill, need care or have a state pension, i will get the same treatment as the man next door. i have subsidised him and people like me keep the Uk afloat and taxes down.

so please have a little sympathy that we will not get the twenty quid a week child benefit. the fact that the government want to take that from us leads me to conclude this is an unfair society as i cannot see how the state will recognise my additional input in later life. i will not be entitled to a penny more than the girl who served me at tesco this evening.

society is a charity, there are donors and there are recipients.

gingerrunner

In the posts people have mentioned Gift Aid & pension to bring down your taxable earning below the 40% threshold what other things are deducted before tax and would work in the same way? I was wondering about:

Child care voucher payments?
Cycle to work scheme payments?

Esoog

TBeckett100 wrote: »

i am a little tired of taxing the rich argument, and would like to offer a viewpoint.

As a higher rate taxpayer, to fill up 60 quids worth of petrol in my car, i have to earn 100 to pay the tax to net that amount. a basic rate taxpayer has to earn 75 and a non taxpayer 60. simplistic, i know

to pay my mortgage, council tax and basic utilities each month, i have to earn 2383 per month. a basic rate taxpayer 1787. Food costs me 1000 pm wheras a basic taxpayer 750pm on a like for like basis.

so because of my earnings, to live a basic month, i need to earn a lot more to net the same as the guy next door to me.

a few months ago, i had a good month. i grossed 18000 yet netted 10000, yes 8000 went in tax, yet it doesnt matter because i am supposedly rich, i can afford to pay more.

the bbc recently developed a calculator to show what the state gains or loses from us based on tax receipts, turns out i give the state 23k p.a. more than i get back, but thats ok, i am supposed to be rich

rather than pointing the finger at high earners and feel they should be clobbered, we already do. we seem to get sneered at, yet those who are sneering probably are having their annual cost subsidised.

when i get ill, need care or have a state pension, i will get the same treatment as the man next door. i have subsidised him and people like me keep the Uk afloat and taxes down.

so please have a little sympathy that we will not get the twenty quid a week child benefit. the fact that the government want to take that from us leads me to conclude this is an unfair society as i cannot see how the state will recognise my additional input in later life. i will not be entitled to a penny more than the girl who served me at tesco this evening.

society is a charity, there are donors and there are recipients.

Wait, you earnt £10000 in a month?

No sympathy whatsoever from me buddy ! You don't need it

i will not be entitled to a penny more than the girl who served me at tesco this evening.

Maybe not, but more than likely whilst she's going to be living alone slumped in a !!!! soaked chair whilst some idiot "aid" comes to see her once a week and humiliates her; you'll be sitting in a swanky retirement castle sampling the scotch!

Fair society? No chance, but you can earn the money to leave and move somewhere nicer, try the BVI - it's a dump but little tax and it's nice weather!

Dorastar

Not sure about the pension thing still though as a teacher my pension comes out of my gross wages therefore reducing my net wage, well that's the way it appears on my wage slip. Currently my pension contributions don't take me out of paying higher tax rate.

So when the government put up my pension contributions, assuming I keep my head down and don't accidentally get myself promoted or pass my performance review (cos we don't want anyone doing well), then I might just keep my child benefit. Is probably going to cost me more than Child benefit for the accountant to work out what a bloomin farce this is - or just move in with the old dear next door.

Am really glad I worked hard to progress in my career thus far - I'd have thought they've had long enough in opposition to have thought out something that actually works.

zagfles

gingerrunner wrote: »

In the posts people have mentioned Gift Aid & pension to bring down your taxable earning below the 40% threshold what other things are deducted before tax and would work in the same way? I was wondering about:

Child care voucher payments?
Cycle to work scheme payments?

Anything which reduces your taxable income should work. Some employers offer salary sacrifice schemes, eg for extra holiday etc.

debtaghh

Can I just check, is it definitely on net income?