Budget changes: did I miss an announcement?

Aretnap

http://www.theguardian.com/money/2016/mar/04/george-osborne-backs-down-on-radical-pension-reform

FT and Times front pages also reporting that there will be no changes. Wow. Any more of this and I might almost start to believe it.

RickyB2000

chucknorris wrote: »

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.

You said you liked your job though. Why are you doing it now? If you have £90k per year outside the job and there isn't any point being the richest man etc, why are you working now? Why is extra tax the deciding factor? Sounds like it is about being the richest man in the graveyard if you were working just to hoard more money in a pension......

chucknorris

RickyB2000 wrote: »

You said you liked your job though. Why are you doing it now? If you have £90k per year outside the job and there isn't any point being the richest man etc, why are you working now? Why is extra tax the deciding factor? Sounds like it is about being the richest man in the graveyard if you were working just to hoard more money in a pension......

I'm doing it now because I like it, but I also like other things too, like catching up with friends, jogging, cycling, swimming, hiking, walking my dog, bowls, chess, etc. There comes a point (like only getting 30% of the gross salary) when enough is enough. Also carrying on working is an extremely marginal decision, it wouldn't take much to tip the balance.

jamesd

Aretnap wrote: »

http://www.theguardian.com/money/2016/mar/04/george-osborne-backs-down-on-radical-pension-reform

FT and Times front pages also reporting that there will be no changes. Wow. Any more of this and I might almost start to believe it.

Seems sensible. If so he's avoided the temptation to have him replace Gordon Brown as the "killer" of pensions and preserved a good hope of being Prime Minister, in part by demonstrating good adaptability to changing circumstances, something he may well have eliminated as a possibility for his future if he'd proceeded down one of the other possible tracks.

EdSwippet

Aretnap wrote: »

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

Ummm..., if you read the linked article closely it quotes Osborne as stating that now is "not the right time" for radical reforms. So perhaps next year will be the right time, then. Or the year after. Or later.

In other words, anticipate uncertainty stretching on for at least the rest of this parliament. Something to look forward to there, then...

Aretnap

Hmmm... If you're going to kick your core voters in the balls the best time to do it is probably early in the parliament, in the hope that they might have forgiven you by the time an election comes around. Admittedly this piece of conventional wisdom is slightly weakened by the fact that the main opposition party currently resembles a smouldering pile of rubble... but I still can't quite imagine Osbourne deciding that the 'right' time is either just before aTory leadership contest, or just before an election. So we might just be OK for the rest of the parliament at least.

Still, I'll be stuffing as much as I can into my pension for the foreseeable future anyway, just in case. I certainly assume that higher rate relief will go next time Labour get into power, but as I'm nearly 42 I doubt whether that will affect me much

RickyB2000

chucknorris wrote: »

I'm doing it now because I like it, but I also like other things too, like catching up with friends, jogging, cycling, swimming, hiking, walking my dog, bowls, chess, etc. There comes a point (like only getting 30% of the gross salary) when enough is enough. Also carrying on working is an extremely marginal decision, it wouldn't take much to tip the balance.

I think where I am struggling is on the one hand you say you have so much money it is likely you won't be able to spend any extra in your lifetime and that you don't want to be the richest man in the graveyard. On the other you say you are only going to work if you get to keep more than 30% of the cash.

If you have plenty of capital and income for the rest of your life, and don't want to be the richest man in the graveyard, surely you can't be working for the money. So any change in tax status doesn't matter. So the only reason to work is because you enjoy it or you want to be the richest man in the graveyard.

Spidernick

Aretnap wrote: »

http://www.theguardian.com/money/2016/mar/04/george-osborne-backs-down-on-radical-pension-reform

FT and Times front pages also reporting that there will be no changes. Wow. Any more of this and I might almost start to believe it.

I think this is the most telling comment from the article and makes absolute sense:

Conservative MPs had become increasingly anxious about the planned changes and the hit to higher earners, and No 10 is known to be keen to avoid any distraction from the battle to win the EU referendum.

I think that, like the Heathrow/Gatwick expansion, this will be kicked into the long(ish) grass until next year at least. Certainly in a brief from my employer (a large accountancy firm) a couple of weeks back, it was felt that opening this can of worms would be too problematic and the status quo would remain.

As I've said on other thread, they can save an awful lot by making salary sacrifice ineffective for pensions (that have grown significantly in recent years) , so that the 13.8% employer's NI saving (which is what is really hitting the Exchequer's pocket) is lost. Employers wouldn't like it, but it wouldn't hit employees as hard (especially 40%/45% taxpayers, who only pay 2% NI) and can easily be justified on the grounds that giving only tax relief brings them in line with anyone else taking out a pension outside of an employer's scheme. The downside of course is that it hits basic-rate taxpayers the hardest, as they lose a 12% NI saving, but overall it would seem to be the most equitable solution to my mind.

Overall I'll be glad when we do find out exactly what is planned.

redux

EdSwippet wrote: »

Ummm..., if you read the linked article closely it quotes Osborne as stating that now is "not the right time" for radical reforms. So perhaps next year will be the right time, then. Or the year after. Or later.

In other words, anticipate uncertainty stretching on for at least the rest of this parliament. Something to look forward to there, then...

Ha, now (or very recently) was sold to us as the time they were bold enough to ask for radical reforms of EU relationships ...

Chicken.

AnotherJoe

westv wrote: »

My company normally gives a month to decide.

Surely you actually have a year to decide ?