Do You Think Income Tax Banding is Fair?

grizzly1911

TrickyDicky101 wrote: »

That's not the point though - I could look at my monthly payslips after all.

If all of us had to pay our taxes out of the money in our bank accounts (rather than having it taken from our pay before it gets anywhere near accounts under our control) it might make all of us think harder about what our taxes pay for and what level they are set at.

I would hope everyone would agree that would be a good thing, no?

Why not divide your salary by 12?

When you see your pay go into your account deduct one from the other.

Do you itemise each DDR or simply think oh I'll just forget , say £500 of salary?

If salary is say £1000 pre tax and £800 after tax just think £200 to the HMRC every 23rd month or whatever. Write it on the calendar or create a monthly event on your smart phone.

I never use to bother that much with VAT but now it is a nice round 20% I find myself doing the calculation all the time. Especially when you are rummaging for something on tinternet trying to save a few quid.

gorgeyetsun

Lokolo wrote: »

I don't see how its dodgy at all. They are all resonable figures to deduct. 50% of people now go to university, so its a resonable assumption that if you are earning £40k, you are likely to have student loan repayments.

Another assumption is pension - I guess I shouldn't bother paying into a pension because it makes my figures look dodgy!

It is also hardly £570 of deductions, at what point did I say I was on £42k!? I didn't (I said around) and even after, said I was on £40k.

My monthly budget DID include the deductions. After all I made my budget based on MY budget with MY takehome.

http://forums.moneysavingexpert.com/showpost.php?p=58946383&postcount=43

This states that I have outgoings of £1500. My take home is £2180, so £680 rather than £600.

At what point have I said anything thats makes my figures look completely dodgy!?

I'm sure you could think up some other deductions to reduce the income and add weight to you argument. You're just not trying!

Lokolo

gorgeyetsun wrote: »

I'm sure you could think up some other deductions to reduce the income and add weight to you argument. You're just not trying!

I could add dental insurance, not sure if thats tax deductable. Oh and I can also get travel insurance too. But I don't.

I don't see how pension and student loan repayments aren't resonable deductions in your eyes. Absolutely ridiculous.

Your argument is based on "oh they can afford to raise 2 children, but they're not allowed to put into pension and they're not allowed to have student loans".

gorgeyetsun

Lokolo wrote: »

I could add dental insurance, not sure if thats tax deductable. Oh and I can also get travel insurance too. But I don't.

I don't see how pension and student loan repayments aren't resonable deductions in your eyes. Absolutely ridiculous.

Your argument is based on "oh they can afford to raise 2 children, but they're not allowed to put into pension and they're not allowed to have student loans".

Actually my argument is that they shouldn't be having children if they can't afford them. End of.

Lokolo

gorgeyetsun wrote: »

Actually my argument is that they shouldn't be having children they can't afford. End of.

I don't have an argument against that at all. However could you please answer my question - why is it ridiculous to take off pension contributions and student loan repayments when working out how much you can afford each month?

gorgeyetsun

Lokolo wrote: »

I don't have an argument against that at all. However could you please answer my question - why is it ridiculous to take off pension contributions and student loan repayments when working out how much you can afford each month?

It's a moot point. You wouldn't have the kids in the first place to have to worry about whether you can also afford your pension and student loan payments.

grizzly1911

Lokolo wrote: »

I could add dental insurance, not sure if thats tax deductable. Oh and I can also get travel insurance too. But I don't.

I don't see how pension and student loan repayments aren't resonable deductions in your eyes. Absolutely ridiculous.

Your argument is based on "oh they can afford to raise 2 children, but they're not allowed to put into pension and they're not allowed to have student loans".

Student loans are allowable as it is really a tax and you can't not pay it, if you have the income.

Pension nah.

N1AK

Lokolo wrote: »

I don't see how its dodgy at all. They are all resonable figures to deduct. 50% of people now go to university, so its a resonable assumption that if you are earning £40k, you are likely to have student loan repayments.

Another assumption is pension - I guess I shouldn't bother paying into a pension because it makes my figures look dodgy!

At what point have I said anything thats makes my figures look completely dodgy!?

When you ignored investments (shares), loans and charitable donations from your figures thus meaning they didn't add up. Not rocket science and all you're doing now is making it look like you still can't work out why you messed up or are so determined to defend the impossible that you can't let it go.

I take it the 50% going to uni figure (it's 40% actually) is also right because you're accounting for the fact you like to add 10% to percentages when you make them up?

If you could think rationally for a few moments you'll notice I didn't refer to the pension, but don't let that stop you from attacking me for having done so in your imagination.

Tancred

guruchelles wrote: »

In tax year 2013-14 personal allowance (for most people) will be £9440.

The 20% tax rate will apply to earnings up to £32010.

The higher rate of 40% will apply to earnings from £32011, plus the PA, which is £41450.

And if you're lucky enough to earn over £150000 you'll pay 45% tax on those earnings.

Is this, in your opinion, fair? Should the jump be from 20% to 40%? Should the 40% threshold have come down? Should the personal allowance have gone up?

Interested to hear opinions.

If it was up to me, I'd have a top rate of 50% on all income above £100k. The other bands seem fair to me.

N1AK

grizzly1911 wrote: »

Student loans are allowable as it is really a tax and you can't not pay it, if you have the income.

Pension nah.

I'll respond to you rather than Lokolo, as he's in full on denial mode. Personally I will accept a standard ~5% of less pension contribution (or equivalent investment) as everyone should be planning something for later life.

The main reason I didn't/don't accept the student loan (especially for graduates before the massive ramp up) is that it is a comparatively short term cost for them if they're, or nearly are, a higher rate tax payer; probably in the region of 3-4 years to pay off once they reach that point.

People on the new, larger, loans could more validly claim it was a tax as even as, just, higher rate payers it could take a couple of decades to pay off.