The Budget

lisyloo

without getting bashed...the budget seems all right unless you're dependent on benefits.

DH is self-employed and pays himself via dividends. He will be quite a bit worse off.
However morally I think this is a loophole getting closed, so not everyone who is worse off has a justification for complaining.

Also worse for lanlords as afly said. Again I think that's ok, but I'm sure landlords don't.

What it does amply demonstrate to me is that you can have the rug pulled from under you e.g. sensibly base a BTL business on current tax rules and then discover it's not profitable because of budget changes.

MFW_ASAP

daveyjp wrote: »

About 4-7%. Or do you honestly believe its 25% because you read it somewhere.

Where did I say anything about 25%? You seem to be buidling a strawman argument here.

Tut, tut. Very lazy

Out of interest, could you supply details on where you got your 4-7% figures? Certainly in Falkirk, the amount of Council tax spent on pensions was 50%.

Please see correspondence below:

Mr Ovens,
The total income derived from Council Tax in 2008/09 was around £59 million. The total sum paid into pension schemes in 2008/09 was around £29 million. £29 million is 49.15% of £59 million.
All Council income (i.e. other than the £29 million paid to pension schemes) goes towards the provision of local services.
I hope this answers your query about pensions and the Council tax.
(Can I just correct what you said in your e-mail. You state that “18% of the council tax goes towards services”. This is not what we have said at all.
What we did say was that 18.7% of the Council’s Income (in 08/09) came from Council Tax).
A McGirr
Pensions Section
Falkirk Council
Tel 01324-506304
Fax 01324-506334
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brian ovens

4 March 2010
Dear McGirr, Alastair,
Thanks again, so basically 50% of council tax goes towards
pensions, and the rest goes too services?
Yours sincerely,
b ovens

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McGirr, Alastair
Falkirk Council

5 March 2010
Mr Ovens,
Yes you could say that in 2008/09 an amount equivalent to about 50% of the Council tax in that year went towards pension contributions. All Council income, other than the sums paid to pension schemes, is used to provide local services.
Alastair McGirr
Pensions Section
Falkirk Council
Tel 01324-506304
Fax 01324-506334

remorseless

afly wrote: »

or self employed or an employer or a landlord

If you're self employed what's the impact?

Employer? is that having to pay the National Living Wage? It's fair!!
Landlord? I think it's fair!

lisyloo

If you're self employed what's the impact?

An increase in tax on dividends - this is how some self-employed people pay themselves to avoid income tax. In most cases may be fair as it's closing down a tax avoidance loophole although that's a sweeping generalisation.

Landlord? I think it's fair!

I agree with you it's fair.
We were jsut pointing out what you missed (as you asked) when you said it was only people on benefits :-)

remorseless

lisyloo wrote: »

An increase in tax on dividends - this is how some self-employed people pay themselves to avoid income tax.

As you pointed out, it's also fair then!

lisyloo wrote: »

We were jsut pointing out what you missed (as you asked) when you said it was only people on benefits :-)

Thank you!!!

afly

remorseless wrote: »

If you're self employed what's the impact?

Employer? is that having to pay the National Living Wage? It's fair!!
Landlord? I think it's fair!

Dividend credit abolishments mean business owners & the self employed on the very lowest income bracket we have in this country face a tax hike of 1.5k

There were people (contractors) exploiting this but genuine business owners (often employers) will get an almighty kick in the pups

Some describe it as a loop hole but it depends on whether you place any value on people who risk everything and create wealth. Otherwise, whats the point? We might as well all just sign up to guaranteed monthly PAYE from some global conglomerate

ChopperST

As someone who sits on both sides of the fence (both PAYE and self employed) I am pleased the dividend loophole is being closed. To pay yourself a basic wage to dodge tax only to take a huge "dividend" many times that basic salary is wrong.

michaels

Hmm - I thought pensions were complicated before when I discovered about PIPs...and then there was this:
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/442951/Transitional_provisions_for_aligning_pension_input_periods.pdf

My PIP used to end in December, I have no idea if / how this impacts on my maximum contributions (using roll over) this year and next.

michaels

The landlord tax changes seem to be bizarre, firstly taxing a business son turnover rather than profit is more than a little unusual and then having a different regime for taxation depending what tax bracket the business person is in again seems strange - presumably this will lead to larger landlords divesting to landlords with only 1 or 2 properties and little other income as they have a tax advantage?

purch

Why any landlord would want to be a sole trader is a complete mystery to me.