MSE News: Budget 2012 - £3.3 billion tax blow for pensioners

Andy_Davies

gadgetmind wrote: »

Between employees and employers NI, a *huge* number of people pay *far* more NI than they will ever get back via pension.

Also bear in mind that pensions pay tax, and some pay more tax than they get as pension!

Employers NI is not paid by employees...

thorsoak

Andy_Davies wrote: »

There is really nothing to match the sense of entitlement that the baby boomers have is there....

"I worked all my life and paid my stamp therefore I'm entitled to x, y and z now..."

The fact is no-one contributes enough in NI to ever fund what they they get as their pension.

The baby boomers lived through the greatest period of economic growth we had and most of it ended up in their pockets - through rising equities (who made the money on endowments), rising house prices etc. They also receive the greatest benefits from the massive amount of money that has been poured into the NHS.

The generations that are coming after are unlikely to do as well as the baby-boomers - pension provision has been decimated, massive growth in house prices means they are unaffordable (at worst), or will require huge mortgages at best, pension age is forever being pushed back etc.

If you've made it to retirement now, you're one of the lucky ones, you've been able to quit work earlier than the following generations and will most likely enjoy a long and healthy retirement paid for by others.

So I wouldn't complain too much...

You know, I am getting so sick and tired of hearing all the spite and ire directed at the baby boomers on MSE that I think I am going to stop coming on here!

Yes, we had a golden time - but we also worked for it - we weren't born with silver spoons in our mouths. We worked for OUR CHILDREN (your generation?) Yes, we remortgaged our house - not for holidays/cars/large tvs etc - but to help OUR CHILDREN (your generation?) onto the housing ladder. Apologies if your parents didn't do the same!

As has been said, we've lived through the fuel crisis of the 1970s, which sparked off inflation, we lived through the crisis of the early 1980s, the interest rates of 15% on our mortgages - and now, pensions which we paid into out - I'm not talking public sector here - are worth diddly squit.

I'm 68. I'm back in work - not because I particularly want to be - but if I am to be financially independant I have to be. I'm one of the majority who, having paid off the mortgage, now has no capital to speak of (talking less than £1k at any time in the bank!) but I'm earning "too much" to be entitled to benefits. And of course, I'm paying tax - I'm not complaining about that - but what I am complaining about is the fact that so many of the younger generation are so darn bitter and vent so much spite on the older generation.

When a community turns on the older members of that community, it shows a diminishing responsibility of that community.

Sad really - and goodbye.

SandraScarlett

Eco_Miser wrote: »

Those getting over £25,400 get to keep the increased Personal Allowance because they have already lost the Age Allowance, so their allowance is still less than that of over-65s getting less than that.
Those getting under £25,400, but enough to pay tax, don't change at all, but don't get an increase they may have expected.
Those who become 65 after 5 April 2013 definitely don't get an increase they expected (the Age Allowance).

I printed off your reply, and took this to my neighbour, who said "Eh?" !!! He's told me he'll get about £27,000 from April. So, going by your figures, he'll be £1,600 over the limit, so he'll lose £800 of allowance, as £1 for every £2 over the limit is deducted.

If his income stays the same next year, will he lose the £800, or will he keep it please? The "n/a" on the IR website, regarding a limit, I assumed meant not applicable, but Jack reckons it could mean not available. Thanks.

thorsoak wrote: »

You know, I am getting so sick and tired of hearing all the spite and ire directed at the baby boomers on MSE that I think I am going to stop coming on here!

Yes, we had a golden time - but we also worked for it - we weren't born with silver spoons in our mouths. We worked for OUR CHILDREN (your generation?) Yes, we remortgaged our house - not for holidays/cars/large tvs etc - but to help OUR CHILDREN (your generation?) onto the housing ladder. Apologies if your parents didn't do the same!

As has been said, we've lived through the fuel crisis of the 1970s, which sparked off inflation, we lived through the crisis of the early 1980s, the interest rates of 15% on our mortgages - and now, pensions which we paid into out - I'm not talking public sector here - are worth diddly squit.

I'm 68. I'm back in work - not because I particularly want to be - but if I am to be financially independant I have to be. I'm one of the majority who, having paid off the mortgage, now has no capital to speak of (talking less than £1k at any time in the bank!) but I'm earning "too much" to be entitled to benefits. And of course, I'm paying tax - I'm not complaining about that - but what I am complaining about is the fact that so many of the younger generation are so darn bitter and vent so much spite on the older generation.

When a community turns on the older members of that community, it shows a diminishing responsibility of that community.

Sad really - and goodbye.

Alas you are right. Youngsters, and I include my own family members, think it's vital to have the latest gadget, and without it, they think they're poverty-stricken, and aren't interested in the fact that we paid, I believe, 30% tax, and went without things in order to do others, and saved.

And where has it got us? I often complete forms for friends, and so many are a few pounds over the limit for Pension Credit, and the accompanying benefits. Those that have saved, because we were taught to be prudent, are finding our hard-earned savings eroded, bogger-all interest rates, and sky high heating bills. My DH has Alzheimers and feels the cold and extra blankets don't help much.

If we'd lived the high life and spent all our money, we'd get Cold Weather payments now, but I'm just grateful that this lovely weather means my DH is warm, without having the heating on.

xx

Eco_Miser

SandraScarlett wrote: »

I printed off your reply, and took this to my neighbour, who said "Eh?" !!! He's told me he'll get about £27,000 from April. So, going by your figures, he'll be £1,600 over the limit, so he'll lose £800 of allowance, as £1 for every £2 over the limit is deducted.

Yes, for 2012/13 it appears that he'll be £1600 over the limit, and so lose £800 allowance, bringing his tax-free amount down to £9700 assuming he's under 75.

SandraScarlett wrote: »

If his income stays the same next year, will he lose the £800, or will he keep it please? The "n/a" on the IR website, regarding a limit, I assumed meant not applicable, but Jack reckons it could mean not available. Thanks.

Since he'll be keeping the Age-Related Allowance for 2013/14 and subsequent years until the standard Personal Allowance passes it, he will also continue losing part of it if his income is over £25400 (I presume - I can't see the Chancellor scrapping the claw-back before scrapping the ARA). The good news is that by 2014 the Personal Allowance will probably be over £9700, so he'll get that higher figure instead.

The "na" I presume means "not available", meaning the 2013/14 figures were not published at the time the page was written.

The above is based on my reading of the budget announcements and HMRC info

Andy_Davies

thorsoak wrote: »

You know, I am getting so sick and tired of hearing all the spite and ire directed at the baby boomers on MSE that I think I am going to stop coming on here!

Yes, we had a golden time - but we also worked for it - we weren't born with silver spoons in our mouths. We worked for OUR CHILDREN (your generation?) Yes, we remortgaged our house - not for holidays/cars/large tvs etc - but to help OUR CHILDREN (your generation?) onto the housing ladder. Apologies if your parents didn't do the same!

As has been said, we've lived through the fuel crisis of the 1970s, which sparked off inflation, we lived through the crisis of the early 1980s, the interest rates of 15% on our mortgages - and now, pensions which we paid into out - I'm not talking public sector here - are worth diddly squit.

I'm 68. I'm back in work - not because I particularly want to be - but if I am to be financially independant I have to be. I'm one of the majority who, having paid off the mortgage, now has no capital to speak of (talking less than £1k at any time in the bank!) but I'm earning "too much" to be entitled to benefits. And of course, I'm paying tax - I'm not complaining about that - but what I am complaining about is the fact that so many of the younger generation are so darn bitter and vent so much spite on the older generation.

When a community turns on the older members of that community, it shows a diminishing responsibility of that community.

Sad really - and goodbye.

We lived through 15% interest rates at a time when house prices were much lower and people whith mortgages got a tax subsidy (besides which 15% rates didn't really last that long)


Rising house prices have been a massive transfer of wealth from the young to the old (and via higher interest payments to people who fund banks)


I don't see a younger generation as being bitter, I see that as the older generations perception when 'their entitlements' are removed.


Saga are forever complaining about age discrimination and the hard lot of the pensioner but never say anything about the hard lot of everthing else. If the really are againt age discrimination why don't they pipe up about the lower minimum wage for under 18's


'Taking your ball and going home with it isn't the answer....'

thorsoak

Andy_Davies wrote: »

We lived through 15% interest rates at a time when house prices were much lower and people whith mortgages got a tax subsidy (besides which 15% rates didn't really last that long)

Our mortgage at that time was £60k - and I'm pretty certain that by that time the tax subsidy had been lifted - if not it was only available up to £30k


Rising house prices have been a massive transfer of wealth from the young to the old (and via higher interest payments to people who fund banks)

Personally, our mortgage was increased to help fund our children's first steps on the mortgage ladder - we (the old) transferred wealth to the young

I don't see a younger generation as being bitter, I see that as the older generations perception when 'their entitlements' are removed.

Oh I do. Look at some of the threads that appear about "selfish" grandparents not complying with their childrens' wants about free babysitting, as well as all those blaming the babyboomers about house prices, over which we have precious little control.


Saga are forever complaining about age discrimination and the hard lot of the pensioner but never say anything about the hard lot of everthing else. If the really are againt age discrimination why don't they pipe up about the lower minimum wage for under 18's


'Taking your ball and going home with it isn't the answer....'

No - its not the answer - but it's better for my blood pressure!!! :rotfl:

gadgetmind

Eco_Miser wrote: »

The good news is that by 2014 the Personal Allowance will probably be over £9700, so he'll get that higher figure instead.

I was projecting that both myself and my wife would never get ARA, so the higher personal allowance will help us in 16 years time even though it hurts us now because of the shrinking 20% band.

Of course, the rules will change another 36 times over those 16 years!

thorsoak

gadgetmind wrote: »

I was projecting that both myself and my wife would never get ARA, so the higher personal allowance will help us in 16 years time even though it hurts us now because of the shrinking 20% band.

Of course, the rules will change another 36 times over those 16 years!

As no doubt, will pension predictions!

molley

I must say that ,since this Budget announcement about the so called Granny Tax, I have never been so infuriated by comments made by mainly young commenters and also probably well off pundits saying things like " Pensioners have never had it so good", " Well,they don't pay National Insurance " , " Why should they get ARA" , " But they are getting this huuuge increase in their State Pension in the next week or so" and other similar comments .
If younger ( under 65's) are having a hard time ,and I don't doubt they might be ,that is not the fault of over 65's . Getting to this age should be a time to relax and do things that you might not have been able to do previously and Pensioners in a ( supposedly) civilised Country should be put in a position where they can do that and this decision ,coupled with the ever increasing retirement age and State Pension age is hardly a sign of that .

amiehall

I have to say I'm a bit sad that no-one has even tried to answer my question. Until this week I'd never heard of the ARA and am really wondering what the original rationale behind it was?