Tax Allowance for over 65

bobthesod

As i understand it the age related allowance is to be frozen until the under 65 tax allowance reaches parity, ie 10,500( current rate)
This means that when this occurs someone over 65 will have the same tax code as those under 65 (given circumstances are the same)
However the under 65 can earn up to 32k ( give or take) before the rate goes up to 40%, but, if the rules now in force will still apply, those over 65 start losing a 'tax point' for every two pounds earned over 26k (give or take)
This appears to be 'ageist' if this is to continue, or does anyone know if this rule will be cancelled once parity in basic allowance is acheived, so i can 'compete' on level terms with some earning the same (say 29k pa)

Apologies if this seems a bit of a ramble

patanne

The claw back of the personal allowance stops when you reach what would be your normal under 65 allowance, so you would be taxed the same as an under 65 would be.

zygurat789

bobthesod wrote: »

As i understand it the age related allowance is to be frozen until the under 65 tax allowance reaches parity, ie 10,500( current rate)
This means that when this occurs someone over 65 will have the same tax code as those under 65 (given circumstances are the same)
However the under 65 can earn up to 32k ( give or take) before the rate goes up to 40%, but, if the rules now in force will still apply, those over 65 start losing a 'tax point' for every two pounds earned over 26k (give or take)
This appears to be 'ageist' if this is to continue, or does anyone know if this rule will be cancelled once parity in basic allowance is acheived, so i can 'compete' on level terms with some earning the same (say 29k pa)

Apologies if this seems a bit of a ramble

The new provisions will mean the clawback is redundant so all the high income pensioners who had to complete a tax return may not have to, this is good news for them and for HMRC. However, never forget that the "Age allowance" included an amount to recompense the over 65s for the
tax increase GB landed them with when he abolished the 10% tax rate.
This is another example of "the burden should fall on the broadest shoulders" there being more poor than rich they (collectively) have the broadest shoulders.

getmore4less

bobthesod wrote: »

As i understand it the age related allowance is to be frozen until the under 65 tax allowance reaches parity, ie 10,500( current rate)
This means that when this occurs someone over 65 will have the same tax code as those under 65 (given circumstances are the same)
However the under 65 can earn up to 32k ( give or take) before the rate goes up to 40%, but, if the rules now in force will still apply, those over 65 start losing a 'tax point' for every two pounds earned over 26k (give or take)
This appears to be 'ageist' if this is to continue, or does anyone know if this rule will be cancelled once parity in basic allowance is acheived, so i can 'compete' on level terms with some earning the same (say 29k pa)

Apologies if this seems a bit of a ramble

40% tax is at £42475
£8,105 personal allowance
£34,370 20% tax band


The loss of the age related personal allowance only applies to the difference in rates once earning go over £25,400. So as the base personal allowance goes up the difference will get smaller.

he cuurent difference is £2395 so parity is at £30190

this page might help
http://www.hmrc.gov.uk/rates/it.htm