Universal Credit

SkyeKnight

Sixer wrote: »

No, 65%. IDS wanted 55%. Treasury said no and wanted to maintain 76%. IDS threw toys out of pram. Treasury dedicated £2bnish - I think, but don't quote me on actual figure - and 65% it was.

All the information I've seen says it's 65% withdrawal of income after tax/NI.

If you are below the threshold to pay income tax then your withdrawal rate will be 65% as you said.

If you pay tax at 20% and NI at 12%, 65% of the remainder (ie. 100-20-12= 68) is 44.2%. Making a total marginal income withdrawal rate of 76.2% as HappyMJ said.

MissMoneypenny

bestpud wrote: »

I'm inclined to agree. I thought UC was about simplifying the benefit system but I can see this being a logistical nightmare.

If they were taking a single welfare payment and dividing it up between DWP, HMRC and every council in the UK, we would be saying what a barmy idea that was.

MissMoneypenny

BigAunty wrote: »

Well, if they could support their children by working a tadge more than approx 2 hours a day between two healthy adults, it would be awfully appreciated....

What!...and interfere with some parents' time on the internet forums!

BigAunty

melly1980 wrote: »

The tax credits system primarily supports families and a legitimate part of bringing a family up is spending time with those children. Quite why anyone would be so incredulous about the value of a good balance in life is beyond me.

we are not here on this earth to work ourselves to death to ultimately make the ruling classes extremely rich.

Or more specifically, from your perspective, as someone planning to increase your pension contributions solely to reduce your income to claim means tested benefits.

"There is no incentive to save for me.

Single earner in the house with 4 kids, my back up plan for unemployment if it comes is the tax credits system. Why put myself in a position to not qualify for it when it becomes UC in 2013....I might as well just take my lifestyle out on a value that keeps me just below the threshold as being sensible does not pay dividends if the worst happens.
Go past 16 or 17K and I'll have a nice litte jaunt to California or florida and start again with the savings never allowing me to go too high. "

http://forums.moneysavingexpert.com/showpost.php?p=51620971&postcount=43

http://forums.moneysavingexpert.com/showpost.php?p=51574227&postcount=76

melly1980

BigAunty wrote: »

Or more specifically, from your perspective, as someone planning to increase your pension contributions solely to reduce your income to claim means tested benefits.

"There is no incentive to save for me.

Single earner in the house with 4 kids, my back up plan for unemployment if it comes is the tax credits system. Why put myself in a position to not qualify for it when it becomes UC in 2013....I might as well just take my lifestyle out on a value that keeps me just below the threshold as being sensible does not pay dividends if the worst happens.
Go past 16 or 17K and I'll have a nice litte jaunt to California or florida and start again with the savings never allowing me to go too high. "

http://forums.moneysavingexpert.com/showpost.php?p=51620971&postcount=43

http://forums.moneysavingexpert.com/showpost.php?p=51574227&postcount=76

you obviously have no idea what I mean by that if you think it has anything to do with this thread.

marywooyeah

me and hubby work full time with a 3 year old and have had the letter saying our tax credits are to stop - does this mean we'll now get UC instead? soooo confused! does anyone know what theoverlap is likely to be? eg tax credits stop in april so when would UC start?!

HappyMJ

marywooyeah wrote: »

me and hubby work full time with a 3 year old and have had the letter saying our tax credits are to stop - does this mean we'll now get UC instead? soooo confused! does anyone know what theoverlap is likely to be? eg tax credits stop in april so when would UC start?!

2013 at the earliest. Why have you lost your tax credits? If it is due to hours then increase your hours and reapply.

real1314

Sixer wrote: »

Yes, that's right.



Yep! How about HMRC? The plan is to implement this as a real-time merge with PAYE. Zagfles is more optimistic than I am about this, but I just cannot see it working.

Think how complex LHA is. It won't be administered by people with any experience of it. It's all leaving the local authority.

LHA is far simpler than the preceeding system was. LHA is based on the household to establish the room rate, which has no LA based criteria; then the Broad Rental Market Area rent rates, which are far wider than the Rent Officer areas.

LHA was "made" for national administration and the efficiency of scale it can deliver. :cool:

marywooyeah

HappyMJ wrote: »

2013 at the earliest. Why have you lost your tax credits? If it is due to hours then increase your hours and reapply.

we've lost our tax credits because we "earn too much" because we both work full time. except all my friends who don't work have more money than us from all the benefits they get, one of my firends is a single mum to 3 kids and gets £1400 per month! :eek:

bloomingflower

confusedmummy wrote: »

In this document http://www.ifs.org.uk/bns/bn116.pdf it says; "Basic entitlements to Universal Credit have been set so that the majority of workless families will receive the same amount of benefits as they do under the current regime".

If that is the case, what is the point of bringing in UC? I thought the whole point of "welfare reform" was to get people back into work by reducing the attractiveness of benefits for long term worklessness? How is this going to get long term workless into work if they are not going to lose any benefits by switching to UC?

I think I read somewhere that one of the reasons for bringing in UC was to make the benefits system a lot more simpler in terms of the whole claiming process.
At the moment we have too many different benefits spread out, which require filling in endless forms,thus causing confusion and the claiming process takes forever and a day to complete.
However,with UC they will gather all benefits under one umbrella,so to speak, then all we have to do is make one claim,instead of making a claim for each type of benefit. (I presume what they mean by 'families will receive the same amount of benefits as they do under the current regime' means they would not lose what they are already getting under new regime etc...)

I guess there is method in their madness somewhat with regards to the claiming issue as this will be a much quicker process as benefits will be dealt with by only one department instead of two or three and will stop the never-ending problems of 'left hand doesn't know what the right hand is doing' scenarios we presently get with the HMRC and DWP.