George Osborne MUST now U-Turn 'Granny Tax'!

bigadaj

:rotfl:

MonkeyMad wrote: »

Glad you took advantage of the situation and bought a house at less than market price and voted for the party that suited your situation. Pity they now have had to make some decisions you don't like, and which unfortunately mean you lost out. Bit like tenants who now cannot get a council house because they have all been sold.

If you banked your future on trading up to live in semi-rural Wales (which you seem very proud of) without ensuring a decent pension you're an idiot.

Still, never mind, if we account the profit you made on the house, you are probably still up, and one could argue you have had quite a lot out of the pockets of other taxpayers already.

Too true, people blame politicians but they and the media just react to public opinion and the public are too thick to realise a short term bribe is going to screw things up in the long term. People retiring now are predominantly baby boomers, ie those who have benefitted from the system most. The future for younger people is far worse.

atush

Too right. which is why I am trying to see my kids thru Uni w/o student debt of 50K plus.

Otherwise they will have no chance.

hugheskevi

I liked pretty much all of that but:

Responsibly drawing down at 120% GAD

As I never really thought that was responsible, more flying by the seat of your pants. Which is fine, I do it on occasion. but you need to acknowledge the risks.

100% is sensible (certainly if gilt-yields are anything like normal) for those who only have one pension.

But for someone who has a big DB pension to come and wants maximum income from a DC pension now it isn't relevant (which was why I added the caveat 'responsibly' to try to differentiate).

So it is the type of rule change which I wouldn't disagree with, but would like to have very long lead times to ensure nobody who could have made and implemented plans on the current system is affected.

Most of these things are fairly small beer and don't affect many in the great scheme of things. But like bad retail purchase experiences, they get talked about a lot more than people who weren't affected by anything will talk about their pensions.

jamesd

boozercruiser wrote: »

Most Pensioners ... no chance at all of increasing it until April comes around and the Government perhaps shoves them a fiver.

This claim is not accurate. For pensioner units as a whole (either couples or singles), just 42% of income is from the state pensions and benefits (page 15). 25% of the rest is from work pensions. The remainder is mostly earnings with some investment and personal pension income as well. So in general less than half of pensioner income has changes announced in April.

Claims that all pensioners are badly off or have been treated badly by successive governments are not so accurate when you look at the facts:

"The average net income after housing costs of all pensioner units grew by 68% in real terms between 1979 and 1996-97. Average earnings in the whole economy grew by 36% in real terms over the same period.

Pensioners’ average income has grown faster than earnings over the last eleven years. Net income after housing costs for pensioner units has grown by 47% between 1998-99 and 2009-10, whereas average earnings have risen by 14% in real terms over the same period." (page 8)

This doesn't mean that all pensioners are well off, though. The median income of the lowest fifth of single pensioners was £4,940 after housing costs. Around three quarters of those are women, many after the death of their spouse. The median of the next fifth was £7,124, much easier to live on. (page 51)

If there's need here, it's concentrated in those single pensioners with low incomes. And those have low enough incomes that their income is likely to already be completely tax free, with benefits paying for housing costs if not an owner, so this age allowance change isn't likely to affect them at all. Better to get rid of the general pensioner age allowance and concentrate the money where it's most needed.

hugheskevi wrote: »

For those at the bottom-end, a bit of pension saving can put you just above the means-testing levels and you miss out on pass-ported benefits and such like.

That bit of saving is something around £40-50,000 worth of capital to generate the income that's allowed while receiving the guarantee payments plus the allowed savings capital. Those who grumble about a disincentive to save also tend to be those who aren't even trying to get to that sort of level, though I'm not including you in this, just making a general observation.

hugheskevi wrote: »

At mid-income, you might end up with a big chunk of income taxed at 30%, rather disappointing when you maybe got tax relief at 20% on the pension saving.

Removal of the age allowance will eliminate this high income pensioner effect.

Age allowance reduction doesn't start until £25,400 income. The middle fifth of pensioner couple income was £19,552 in 2009-10. Next fifth was £25,740. Single pensioners have less pension provision in general. The top fifth of those had a median income of £19,084. (table on page 51)

So income-based age allowance reduction for an individual pensioner doesn't really start until they are already likely to be in the top 20% of all pensioner income levels.

boozercruiser

This article from the Mail Online explains the whole issue rather well...

http://www.dailymail.co.uk/money/pensions/article-2119277/Budget-pensions-tax-allowance-We-explain-YOU-affected-Granny-Tax.html#ixzz1urCBFGHk

The day George Osborne took the Elderly for fools...
http://www.youtube.com/watch?v=4yDqFvVBNK4

The Tax Gran song...
http://www.youtube.com/watch?v=qMMVe4kfQaE

One of the letters, which I agree with from the above thread...

When the coliation was formed it promised a minimum 2.5% rise in State Pensions each year. The freezing of pensioners tax allowances for those people between £10000 and £24000 will not, in effect, receive this 2.5% but a 2% increase. This is because the way pensioners tax liablity is calculated by the Revenue. I would not object to freezing this allowance if the Government guarantees a FULL untaxed 2.5% minimum increase whilst the freeze is effective.

This current year we received a reasonable increase but this was solely caused by inflation as recorded last September, not in our control. The £140 minimum pension forecast will not be received by those already receiving a pension.

To cap it all this generation paid a minimum od 44 years of NI to receive a full pension whereas the future generations will only be required to pay 30 years NI for a better pension. Mr Cameron and Mr Osborne should think this change through fully before applying it next year.

Moby

I don't really stand anywhere and make my own decision regards every issue based
on objective evidence. I also subscribe to both The Guardian and The Telegraph.
Balance!

I think we'd all claim to do that!

I see it nearly every day.
However, things are improving. There are signs that the tax situation is
improving, and schemes such as SEIS are letting more experienced entrepreneurs
mentor and fund younger ones. Trust me, we have some *fantastic* young people,
really smart, really driven, and they just need help with some of the fine
detail.
They are also *very* mobile, and their skills are in demand across the EU and
around the world, so losing them (perhaps forever) is easy. Fortunately, we now
have a government that seems to recognise this, and the trend is
encouraging.

I note you didn't provide any evdence of this assertion. In fact unemployment amongst the young is horrendous and this Govmt scrapped the last Govmts 'Back to work' scheme and I think what this govmt does in terms of forcing young people who are on unemployment benefits to perform free labor for private sector employers is absolutely atrocious (and probably helping cause’ more unemployment.

Entrepreneurs don't need a push. And while it's useful to be able to ascribe
their drive and success to some early-life advantage, this fails the "necessary
and sufficient" test.
If you doubt any of what I say, please get yourself along to some Business
Angel open days and actually talk to the people at the sharp end.
P.S. I hate the word "entrepreneur", partly because it sounds French, and
partly because I struggle to spell it!

Useful?? ....don't simplify what I'm saying!....which is life opportunities, (anecdotal evidence aside) closely correlate with measures of success outcomes ie class mobility, income, wealth etc. Creating a comfortable environment for entrepreneurs is therefore at best pointless and at worst harmful to society generally because available resources need to concentrate on equality of opportunity for everybody.

QUOTE FFACOFFPAWP
Chavs, scroungers and layabouts.

Poor people are too thick to
understand that the Labour Party is their enemy and not their friend. It wants
to raise the drawbridge, whereas the Conservatives want to lower it so anyone
can succeed (if they can be arsed).

Grossly offensive to 'poor people' of course and says more about you and your views than anything else!

teajug

boozercruiser wrote: »

This article from the Mail Online explains the whole issue rather well...

http://www.dailymail.co.uk/money/pensions/article-2119277/Budget-pensions-tax-allowance-We-explain-YOU-affected-Granny-Tax.html#ixzz1urCBFGHk

The day George Osborne took the Elderly for fools...
http://www.youtube.com/watch?v=4yDqFvVBNK4

The Tax Gran song...
http://www.youtube.com/watch?v=qMMVe4kfQaE

One of the letters, which I agree with from the above thread...

When the coliation was formed it promised a minimum 2.5% rise in State Pensions each year. The freezing of pensioners tax allowances for those people between £10000 and £24000 will not, in effect, receive this 2.5% but a 2% increase. This is because the way pensioners tax liablity is calculated by the Revenue. I would not object to freezing this allowance if the Government guarantees a FULL untaxed 2.5% minimum increase whilst the freeze is effective.

This current year we received a reasonable increase but this was solely caused by inflation as recorded last September, not in our control. The £140 minimum pension forecast will not be received by those already receiving a pension.

To cap it all this generation paid a minimum od 44 years of NI to receive a full pension whereas the future generations will only be required to pay 30 years NI for a better pension. Mr Cameron and Mr Osborne should think this change through fully before applying it next year.

I totally agree with this..

There are many companies that will employ experienced older members of the community - B&Q, BT, Centrica, M&S and Sainsbury's being the top 5.

The companies listed above used to employ older members staff, not any more due to recession, they would rather employ younger people that are on visas for a year or so on a minimum wage, as they tend to be more malleable for retailer needs such as being able to do lots of free overtime and no problems with disability or taken the company to a tribunal for discrimination. No access to work involved making adjustments for disability and also if the get employee has one or two days off work with the flu they can be sacked with impunity.

I am aware that one of the companies above has now done away with giving staff time and half for working Sundays and bank holidays these days are now classed as ordinary days. Also managers can dictate when staff can take their holidays.

The older people that are employed with the companies mentioned above are in good health and perhaps have shares in the company. You will not find any of Retail companies taking on older people now that have obvious age related condition such as arthritis as they cannot stand or sit for long periods. Retail is the worse place to work as there is no support for staff and I know this is from employees that works in one of the companies mentioned above. How can a person regardless of their age be able to continuous scan 17 items a minute for five or six hours without a break. Also cameras will always be looking at the way you work and act towards customers.

The Lib/Con are debating making it easier for employers to get rid of employees if they do not like the look of them.

How can people plan to set up home or get a mortgage and plan to have a family if employers are going to sack staff if they do not like the look of them. No security of employment and do not know from one day to the next if they may be sack just because a manager does not like the look of you, or if they become disabled or god forbid if they get the flu and have a day or two off with it and be sacked for it. How can you contribute towards a pension scheme if you do not know if you are going to be employed the following week or not. :eek:

JoeCrystal

teajug wrote: »

How can you contribute towards a pension scheme if you do not know if you are going to be employed the following week or not. :eek:

Actually, it may still be worth contributing toward a pension, especially if the company contribute to it as well. But rest of your points on working condition are horribly right.

Cheers

Joe

Fella

Serious question for anyone who's against any proposed "cut" (not just this pension measure):

What do you think should be cut harder to pay for it?

For the last 2 years we've had literally every group out there complain one-by-one that the cuts are unfair. And not one of them, ever says what they'd cut instead. Quite frankly they shouldn't be allowed to get away with that, whichever outlet is giving them coverage should insist on their alternative cuts or refuse to give them airtime.

Saying "tax the bankers more or keep the 50p tax rate doesn't count, you could do both of those & it still wouldn't pay for 5% of the spending that needs to be cut. Let's hear some real stuff. Let's hear pensioners saying teachers pay should be cut. Or train drivers saying policemen's pay should be cut. Or something similar (but honest). Because that type of thing is the only way it can actually work. Everyone who says "don't cut {their money}" is implicitly asking for someone elses to be cut more, just without the honesty to come out & say it.

As I say, not aimed at the anti-pension-measures people specifically.

Moby

teajug wrote: »

I totally agree with this..

The companies listed above used to employ older members staff, not any more due to recession, they would rather employ younger people that are on visas for a year or so on a minimum wage, as they tend to be more malleable for retailer needs such as being able to do lots of free overtime and no problems with disability or taken the company to a tribunal for discrimination. No access to work involved making adjustments for disability and also if the get employee has one or two days off work with the flu they can be sacked with impunity.

I am aware that one of the companies above has now done away with giving staff time and half for working Sundays and bank holidays these days are now classed as ordinary days. Also managers can dictate when staff can take their holidays.

The older people that are employed with the companies mentioned above are in good health and perhaps have shares in the company. You will not find any of Retail companies taking on older people now that have obvious age related condition such as arthritis as they cannot stand or sit for long periods. Retail is the worse place to work as there is no support for staff and I know this is from employees that works in one of the companies mentioned above. How can a person regardless of their age be able to continuous scan 17 items a minute for five or six hours without a break. Also cameras will always be looking at the way you work and act towards customers.

The Lib/Con are debating making it easier for employers to get rid of employees if they do not like the look of them.

How can people plan to set up home or get a mortgage and plan to have a family if employers are going to sack staff if they do not like the look of them. No security of employment and do not know from one day to the next if they may be sack just because a manager does not like the look of you, or if they become disabled or god forbid if they get the flu and have a day or two off with it and be sacked for it. How can you contribute towards a pension scheme if you do not know if you are going to be employed the following week or not. :eek:

Excellent post.... the Beechcroft report is very telling. It defines the values and motives of the Govmt. Unregulated free market competition creates huge numbers of societal casualties. Political dissafection, industrial strife, higher uemployment result and that is without the quiet, often unrecorded consequences such as family breakup etc.

QUOTE Fella


For the last 2 years we've had literally every group out there complain
one-by-one that the cuts are unfair. And not one of them, ever says what they'd
cut instead. Quite frankly they shouldn't be allowed to get away with that,
whichever outlet is giving them coverage should insist on their alternative cuts
or refuse to give them airtime.

Saying "tax the bankers more or keep the
50p tax rate doesn't count, you could do both of those & it still wouldn't
pay for 5% of the spending that needs to be cut. Let's hear some real stuff.
Let's hear pensioners saying teachers pay should be cut. Or train drivers saying
policemen's pay should be cut. Or something similar (but honest). Because that
type of thing is the only way it can actually work. Everyone who says "don't
cut {their money}" is implicitly asking for someone elses to be cut more, just
without the honesty to come out & say it.

I think we could start with the defence budget. Its huge and grossly disproportionate to our needs IMO.