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40% Tax Liability
Comments
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gadgetmind wrote: »That's nothing to do with the NHS. This is all part of HMG's war on pensions
Specifically, it was Gordon Brown's war on pensions....0 -
Specifically, it was Gordon Brown's war on pensions....
Sadly the current government have not only done nothing to defuse this but have brought in further counter-productive rules onto top of the previous ones.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
I was one of the few in my company not to strike when the changes to the NHS pensions were suggested as I think it is only fair the public sector move in line with the private sector with respect to pension contributions. However what isn't clear is that have we seen the last of the tinkering to the scheme in my lifetime?0
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I was one of the few in my company not to strike when the changes to the NHS pensions were suggested as I think it is only fair the public sector move in line with the private sector with respect to pension contributions. However what isn't clear is that have we seen the last of the tinkering to the scheme in my lifetime?
What is clear is that even the current levels of pensions are unsustainable with an aging population. Either retirement ages must continue to rise or benefits continue to fall, or both.
We have it easy here though in comparison to the USA, who are well past bankrupt and any hope of recovery. The future US national debt based on current spending commitments versus income is over 80 trillion:
http://www.dailymail.co.uk/news/article-2380987/Leading-economist-says-US-national-debt-actually-86-8TRILLION.html
Which is more than the GDP of the entire planet!
Once that reality hits the global RADAR, the recent economic issues will be nothing in comparison...the only real solution other than a default will be a massive devaluing of the debt by sustained high inflation....0 -
What is clear is that even the current levels of pensions are unsustainable with an aging population. Either retirement ages must continue to rise or benefits continue to fall, or both.
We have it easy here though in comparison to the USA, who are well past bankrupt and any hope of recovery. The future US national debt based on current spending commitments versus income is over 80 trillion:
http://www.dailymail.co.uk/news/article-2380987/Leading-economist-says-US-national-debt-actually-86-8TRILLION.html
Which is more than the GDP of the entire planet!
Once that reality hits the global RADAR, the recent economic issues will be nothing in comparison...the only real solution other than a default will be a massive devaluing of the debt by sustained high inflation....
USA will be number one power and number one economy for some considerable time yet
it will see you out0 -
What is clear is that even the current levels of pensions are unsustainable
I want to put *my* money into *my* pension to pay for *my* old age and know this means that I'll have to take on investment risk etc,
Even this, where I'm not asking anyone else to chip in, provide guarantees etc, is being ham stung with stupid rules.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
gadgetmind wrote: »Even this, where I'm not asking anyone else to chip in, provide guarantees etc, is being ham stung with stupid rules.
Effectively you're asking someone to "chip in" in a way - in that you'd like a tax break. The government wants to encourage people putting some money away for later so they're not destitute and reliant on the state in old age so allows them to take a tax break on the income they earn in a year if they commit to investing it until they're 55.
Naturally not everyone needs this protection and generally it's accepted that people earning more and having more cash that they don't need for current necessities is that they pay more tax. A disincentive to earn, but you have to draw the line somewhere to decide who pays and who receives and what qualifies for breaks.
The price of getting a salary x times over the median is that you pay more tax unless you're giving it away to charity or undertaking certain activities to take advantage of qualifying for certain tax breaks which have limits.
So, inevitably, whatever government is in power and whatever rules they set, it can be tricky to be a high income earner and want to still exploit the rules you could exploit when you were a lower earner.
Bottom line, if you're running into problems with a lifetime contribution cap or an annual contribution cap, you have what most people would call "a nice problem to have". Same if the reason you want to make the contributions is because you're on a 60%+ marginal rate. The high marginal rates are because for example someone now has enough household income to not need child benefit they used to get, or they earn over 100k so don't really need the annual tax free amount they used to have, as much as the next man needs it.
Overall, pensions could probably be simpler but ultimately it's the same with any tax break or benefit - you set a basic rule, draw a line somewhere, and then keep tweaking it with 'enhancements' when you think of other reasons why someone should or shouldn't qualify for whatever reason, usually to do with how much they earn or how much of the tax break they want.
Makes it painful to navigate but, not wanting to turn it into politics, some other countries do it worse so I just count my blessings that there are still breaks there that I can understand or I can pay someone else to understand. At the poorer end of the spectrum where people are less able to afford advice, there are fewer relevant rules you need to understand to get the break.0 -
bowlhead99 wrote: »Effectively you're asking someone to "chip in" in a way - in that you'd like a tax break.
I don't want to be taxed both on the way in and when drawing my pension. That doesn't sound like asking someone else to chip in to me!A disincentive to earn, but you have to draw the line somewhere to decide who pays and who receives
How about "all of us" and "none of us", in that order?The high marginal rates are because
of the politics of envy.I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0
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