Budget changes: did I miss an announcement?

chucknorris

RickyB2000 wrote: »

60% on most of your income? Plus 10% (so 70%). How does that work? Whatever I type in to a salary calculator, the amount of tax (including NI) on all income is always under 50%. There may be parts of your salary that get hit at 60% (like the bit over £100k), but it is small amount of the total salary earned, so translates to only a small increase in overall tax paid (still below 50%). Feels a bit extreme to throw in a job you like for a few percent extra tax overall.

But you are only looking at employment income and not considering other income! My investment income is about £90k PA, so all of my employment income is taxed MARGINALLY very high.

It doesn't seem extreme to me, especially as I /we are unlikely to to live long enough to actually spend the money that I earn (because we also have substantial capital to draw down from). There isn't any point in being the richest man in the grave yard, life should be about living, not attaining a certain capital value.

Thrugelmir

michaels wrote: »

Does anyone else find it annoying that potentially we only get 2 weeks to completely re plan and then rejig our finances between the budget and the start of the next financial year

No need to panic and get over excited. Such a fundamental change isn't going to be implemented in 2 weeks. More likely 2 years.

chucknorris

Thrugelmir wrote: »

No need to panic and get over excited. Such a fundamental change isn't going to be implemented in 2 weeks. More likely 2 years.

2 years would be better, but why not in April 2017?

Thrugelmir

chucknorris wrote: »

2 years would be better, but why not in April 2017?

Takes 10 seconds to make a broad statement. But a lot longer to detail the finer points. Build systems etc.

chucknorris

Thrugelmir wrote: »

Takes 10 seconds to make a broad statement. But a lot longer to detail the finer points. Build systems etc.

Obviously, but don't you think that it could be implemented in April 2017? Don't get me wrong, 2018 would suit me better, I don't actually want to retire, so the longer the better, so I'm hoping that you are right.

jamesd

Sterlingtimes wrote: »

I am pondering whether to crystallise before Budget Day to benefit from the present £1.25 million LTA and tax grab my 25% while the going's good. I will keep my ears to the ground over the next few days for any authoritative indications as to what will happen.

I would, regardless of what is in this Budget. You're likely to need that lower LTA percentage use for the age 75 test against LTA of growth on what remains in the pension. It'll take a while to put the lump sum into tax wrappers but it's still likely to be the right long term plan.

jamesd

WobblyDog wrote: »

My employer requires staff to commit themselves to a particular level of salary-sacrifice pension contributions a week before the budget, which is binding for 12 months (except in limited cases). I suspect this is to avoid the hassle of complicated re-calculations caused by changes in the budget.

Well, remember that under auto-enrolment rules members have a legal right to opt out at any time and the payroll a month or more after that should reflect that they are now opted out.

There isn't a legal right to just reduce contributions but sensible employers will accept changes if the Budget makes substantial changes. My own work scheme formally says no changes but in practice it does accept changes that are well justified even when there is no lifestyle change. They just don't want lots of employees routinely making changes just because they didn't think ahead.

You can potentially do things like picking the timing of auto-enrolment opt out to use just higher rate income tax, say, then enrol again during the next benefits selection period, after confirming with your employer that this is allowed. If enough employees ask about this they will probably get the hint that they should more generally allow it.

Thrugelmir

chucknorris wrote: »

Obviously, but don't you think that it could be implemented in April 2017? Don't get me wrong, 2018 would suit me better, I don't actually want to retire, so the longer the better, so I'm hoping that you are right.

Radical change will require proper notice. As the wider implications could be sizable. If the aim is broaden the appeal of saving while at the same time being positive to the coffers of the Treasury. GO has a black hole to fill. That's never been in doubt.

Aretnap

http://www.telegraph.co.uk/finance/personalfinance/pensions/12184105/George-Osborne-abandons-middle-class-pensions-raid-after-backlash.html

Well today's a telegraph completely contradicts yesterday's - Osbourne bottles it and will make no major change s after all..

There's another week and a half of this to go though...

Naughty_Noonoo

One thing is for sure, George will use the term 'difficult decisions' and 'fairness' when delivering a budget which will protect his own seven figure pension pot whilst screwing those in the middle over trying to save for retirement. As for those at the lower end who stand to gain, all of the people I know who fall in to this category either contribute nothing or 'a few pounds a week' into a pension scheme.