Do You Think Income Tax Banding is Fair?

Lokolo

N1AK wrote: »

In response to your last question, on the assumption it is genuine. My point was never that had you explained the loan, charitable giving, share schme etc there was anything wrong with your example. However posting up that you have an income of x and a budget of y with a remaining amount of z which bares little relation to those was bound to be questioned. If you had just said, my bad I didn't mention the money I am giving to charity, paying off my student loan and buying shares with that would likely have been the end of it.

But there's very little difference, as I've shown above, with my personal budget and a resonable one. (in your eyes)

I also realised I sold 5 days holiday which increases my income (although its not tax deductable, shame). I guess because I didn't mention that I am even more in denial and attacking you eh!

edit

From what I have gathered. My take home of £2180 means I am in complete denial about something and my figures are full of holes of them.

Yet your suggestion of student loan and 5% pension, making £2163, is entirely OK.

gorgeyetsun

Fella wrote: »

Of course it's then taxed when you draw it as a pension and you have absolutely no idea what restrictions will be on pensions by the time you draw it or what the tax rate will be.

Paying into a pension is one part of managing your finances but certainly not a no-brainer. I have some conventional pension funds but in general I support that view that sacrificing the tax-breaks pensions give you up front is more than made up for by having complete control over your money (& not paying income tax when you come to spend them).

For higher rate taxpayers, it is a 'no-brainer' to pay into a pension. You get higher rate tax relief when you pay money in and you pay lower rate tax relief when you draw your pension.

The line becomes blurred when you are a basic rate tax payer with no employer contributions. You then have to start looking at the value of means-tested benefits and bankruptcy protection provided by traditional pensions.

N1AK

Lokolo wrote: »

Please tell me where my figures have holes in them?

I have yet to lie about a single figure.

Hopefully my amended post answering your question as to what it was that I felt you were in denial of will explain the issue.

If you really can't see why missing out giving money to charity and buying shares (the most obviously extraneous ones) is misleading when explaining your budget in the context of whether your income is a good one or not then I can't help you.

You'd also be wise to note I never accused you of lying, although some of the things you said were false, I don't believe you ever intentionally said something you didn't believe to be true or approximately true.

Lokolo

N1AK wrote: »

Hopefully my amended post answering your question as to what it was that I felt you were in denial of will explain the issue.

If you really can't see why missing out giving money to charity and buying shares (the most obviously extraneous ones) is misleading when explaining your budget in the context of whether your income is a good one or not then I can't help you.

You'd also be wise to note I never accused you of lying, although some of the things you said were false, I don't believe you ever intentionally said something you didn't believe to be true or approximately true.

Yet I only contribute 2% into pension. The difference between your extra 3% and my extra share/charity is VERY little. As I have shown previously. Yet you seem to indicate that my figures are completely out of touch.

As I showed you above, your "resonable" figures of student loan and 5% pension has very little difference to my shares and charity contributions.

To be in denial I have to have said something which is untrue, none of my figures have been untrue at all.

N1AK

Lokolo wrote: »

But there's very little difference, as I've shown above, with my personal budget and a resonable one. (in your eyes)

Yet your suggestion of student loan and 5% pension, making £2163, is entirely OK.

I've never suggested excepting student loans. I have said that I wouldn't find it overly misleading if someone deducted a reasonable pension payment from income when calculating net pay as that is common behaviour.

I've never even questioned the net figure, only the misleading way you produced it and the fact that even after pointing out the various deductions used to make it add up you won't accept that leaving them off was intentionally or not misleading.

Lokolo

N1AK wrote: »

I've never suggested excepting student loans. I have said that I wouldn't find it overly misleading if someone deducted a reasonable pension payment from income when calculating net pay as that is common behaviour.

I've never even questioned the net figure, only the misleading way you produced it and the fact that even after pointing out the various deductions used to make it add up you won't accept that leaving them off was intentionally or not misleading.

I wasn't misleading at all. I literally read the figures off my budget, and typed them in here.... It's not like I calculated "oh what can I take off to !!!! off N1AK". It's not misleading at all, its what my take home and what my budget is. It's not an unresonable situation that I am in either.

I also apologise, it is £125 for shares, not £150.

You just seem to think that if someone doesn't abide by your pay calculation rules they are wrong.

N1AK

Lokolo wrote: »

The difference between your extra 3% and my extra share/charity is VERY little. As I have shown previously. Yet you seem to indicate that my figures are completely out of touch.

To be in denial I have to have said something which is untrue, none of my figures have been untrue at all.

And I don't care. It has never been about the final net income (as you'd notice if you read and responded to the content of other people's posts) but the misleading method used to calculate it.

To try and put it in a very simple example: I lend someone £10, later on I want the £10 back. If they had £10 but needed it to get to work in the morning then I wouldn't mind if they said they can't give it to me now. However, if they only wanted to keep the £10 they have because they want to buy a couple of pints but still said they couldn't afford it then I would feel I had been misled.

We're discussing how £42k is a good wage then you chime in by pointing out how tight your budget would be while neglecting to mention that you're deducting charitable giving and investment.

Fella

gorgeyetsun wrote: »

For higher rate taxpayers, it is a 'no-brainer' to pay into a pension.

Only if you have no brain. You have no way of knowing what the tax treatment (or the lower or higher rates of income tax) will be by the time you reach retirement age. Who's to say you will be a lower-rate taxpayer when you're a pensioner anyway?


Furthermore there are massive restrictions on what you can do with your pension pot & most of it is going to have to go on an annuity which are already paying much much lower than they did even a few short years ago with no sign of that trend reversing.

As I said I have some pension funds but I prefer complete control over the majority of my investments.

N1AK

Lokolo wrote: »

I wasn't misleading at all.

And thus the denial. I've wasted enough time explaining the patently obvious here.

Lokolo

N1AK wrote: »

We're discussing how £42k is a good wage then you chime in by pointing out how tight your budget would be while neglecting to mention that you're deducting charitable giving and investment.

At what point did I say how tight my budget would be?

At no point did I say people couldn't live off it. At no point did I say it was impossible and that people wouldn't be able to afford it....

I just gave an example take home, an example budget, showed how much money there was after resonable deductions then left it to others to draw conclusions. All I said was "I don't think a lot of people would manage on £600 for 3 other people", which is a fair enough comment is it not?

Then all I get back is s*** how I am in denial and that my figures have too many holes in them.

N1AK wrote: »

And thus the denial. I've wasted enough time explaining the patently obvious here.

I'm not in denial at all! I have never kept anything from anyone in my figures! I told you my take home, if you thought it was misleading why didn't you comment on it before I told my deductions? None of my figures are false, or malicious or any other definition of misleading, they are what they are!