Osbourne's tax relief changes in the March budget

westv

Owner occupier tax benefits??

neilvw

westv wrote: »

Owner occupier tax benefits??

Perhaps the most notable of these is the lack of CGT on sale of ones primary residence.

BobQ

hugheskevi wrote: »

Interesting to read of the several posts of folk planning to retire in response to pension changes.

It does demonstrate how many disincentives to work are being built into the system - higher rate tax [£43,000], child benefit taper [£50,000], personal allowance withdrawal [£100,000],.......................

Maybe all these disincentives are just a way of telling people to retire and create opportunities for those who will need them if they are ever going to be able to pay off their mortgages and other debts and then earn a pension that enables them to retire when their time comes?

So many people seem to want to defer their retirement. When I started work everyone seemed to have the ambition to retire early and enjoy it. As these people reach this period they now want to keep working.

neilvw

BobQ wrote: »

Maybe all these disincentives are just a way of telling people to retire and create opportunities for those who will need them if they are ever going to be able to pay off their mortgages and other debts and then earn a pension that enables them to retire when their time comes?

Isn't this an example of the "lump of labour fallacy"?

https://en.m.wikipedia.org/wiki/Lump_of_labour_fallacy

BobQ

neilvw wrote: »

Isn't this an example of the "lump of labour fallacy"?

https://en.m.wikipedia.org/wiki/Lump_of_labour_fallacy

If these disincentives exist (Hugheskevi says they do) they exist for a reason. and have an effect. The fallacy is not that there are a fixed number of hours for labour to work, the fallacy is to believe that causes do not have effects.

If the economy was so successful that there was no limit to the available hours and we wanted people to work when they can afford not to do so, surely we would be removing those disincentives?

Snakey

BobQ wrote: »

Maybe all these disincentives are just a way of telling people to retire and create opportunities for those who will need them if they are ever going to be able to pay off their mortgages and other debts and then earn a pension that enables them to retire when their time comes?

Then they could put the minimum age for accessing a private pension back to 50 - if I could get hold of my PCLS then, I could pay off my mortgage, and if I didn't have a mortgage I wouldn't need to work (or at least, not full-time). I could keep the freelance for the basics, and somebody else could have my job.

I don't think any government devotes extra time to thinking through all the possible distant consequences like chess grand masters - oh, if we do this then they'll do this but their employers won't do this and then this other group will do this and then this will happen and it will be the best for everybody overall. I think most of their policies are either tax grabs or pre-election bungs.

So many people seem to want to defer their retirement. When I started work everyone seemed to have the ambition to retire early and enjoy it. As these people reach this period they now want to keep working.

I suspect that's bog-standard human nature. I remember how impossibly ancient 50 sounded to me when I was 25. I honestly don't think I drew any distinction between 50 and 75, in terms of what it meant to be that age and the sort of lifestyle I'd want/need. Now I'm coming up to 44 it's a lot clearer!

kidmugsy

neilvw wrote: »

Perhaps the most notable of these is the lack of CGT on sale of ones primary residence.

Plus the 1963 abolition of the old Schedule A, an income tax on the imputed rent. Plus the new partial IHT exemption. The owner-occupier gets a deal that is rationally unjustifiable.

N1AK

GunJack wrote: »

you've missed my point entirely there.......

I can only go by what you write in your post. If you're point wasn't that pension contributions should be limited to 15% of income, then I suggest you don't write about it in your posts

N1AK

hugheskevi wrote: »

It is hard to say what the best course of action is, managing investment volatility is one thing, second-guessing frequent and significant policy changes is impossible to mitigate when the ability to crystallize pensions is many years away.

I agree with all of this post. There is something fundamentally wrong with a system which requires people to estimate financial performance 30+ years in advance to decide the right thing to do. Invariably the complexity discourages a lot of the good prudent behaviour pension incentives are supposed to encourage.

MARTYM8`

Am thinking of doing a lump sum top up through work into my AVC – which is linked to my defined benefit pension. Unfortunately its now too late for it to make the February pay run at my employers so would go through in March - after the date of the Budget.

If the Chancellor decides to make any changes with immediate effect I was just wondering how much of an administrative issue this would create for employers if they had already done their March payroll calculations in terms of employee pension contributions and related tax relief. Clearly this could be unwound had this been done earlier in the year but as it’s the last pay run of the tax year its messier.

For practical reasons I would have thought it would be problematic to introduce the change immediately for payroll deductions – so here’s hoping its delayed until the start of the new tax year in April (or later!)

Any thoughts?