Boomers Pension Gravy Train Finally To Be Derailed

westernpromise

Wild_Rover wrote: »

Really? Income from shares ISA? What about PEPs? They were introduced in 1986, so investors in them and their successors have had up to 30 years or so of investment in shares with all returns having tax advantages, or are completely tax free with returns able to be reinvested without tax, to produce more tax free returns. Fabulous for those who did it. (The power of compounding!) I have a small range of shares in an ISA and the dividends are entirely tax free; they would be entirely tax free if the returns were 100 times as big. I don't "need" the cash at the moment, so I let the dividends ride and buy more shares when the sum builds up to a level that is worthwhile and when the opportunity seems right. If I keep doing that, I'll NEVER pay any tax on the eventual proceeds if/when I cash it in. Is that not the case?

AFAIK, someone with a regular income from shares pays no tax on it, if coming from an ISA. The personal allowance is irrelevant. Someone with the same level of income - or less - from a job, will pay tax (on £ above the personal allowance), NI and pension contributions.

Are you saing that someone on a salary of 120k can't have an ISA?

Happy, nay delighted to have that contradicted!

WR

You're right of course; I was thinking of income from multiple jobs or pensions. I suggest you think hard about whether income from ISAs should use up yoru personal allowance though. Limiting what people can put into their pensions is a disaster waiting to happen. Undermining savings in the way you suggest would be another.

antrobus

ruggedtoast wrote: »

...Out in the real world (from where all these newspaper articles originate) thing aren't looking quite so rosy....

Dunno about that; seems all the boomers have to so is vote Labour.:)

Shadow Treasury minister Rebecca Long-Bailey has promised to protect the triple lock "throughout the lifetime of the next Parliament" until 2025. McDonnell went even further and accused the Conservatives of "abandoning older people" by not guaranteeing to continue with the. triple lock beyond 2020.

Labour pledges to keep pensions triple lock
http://www.bbc.co.uk/news/uk-politics-38148520

Looks like the Toxic One won't be voting Labour.:)

[Deleted User]

westernpromise wrote: »

You're right of course; I was thinking of income from multiple jobs or pensions. I suggest you think hard about whether income from ISAs should use up yoru personal allowance though. Limiting what people can put into their pensions is a disaster waiting to happen. Undermining savings in the way you suggest would be another.

Please don't get me wrong; my intention is not to undermine savings. I suppose my point is that we don't actually tax "income" in a uniform manner. Your average worker pays basic rate tax on everything earned above the personal allowance while someone else can achieve just as sizeable - or a much greater - income entirely tax free. If the country is as knackered as we are told, and if we are concerned at all with notions of fairness, having a tax system that disproportionately benefits the better off seems a bit odd.

Imposing a punitive tax rate of 47% for pensioners ONLY, as demanded by Rugged, is simply ludicrous. Still no answers from him on democratic means, on what basic tax rate he thinks should apply, how much he saves or puts into a pension, so I tend to give his opinions the respect they merit. I'll leave others to guess how much that is.... :cool: .

WR

[Deleted User]

antrobus wrote: »

Dunno about that; seems all the boomers have to so is vote Labour.:)

Shadow Treasury minister Rebecca Long-Bailey has promised to protect the triple lock "throughout the lifetime of the next Parliament" until 2025. McDonnell went even further and accused the Conservatives of "abandoning older people" by not guaranteeing to continue with the. triple lock beyond 2020.

Labour pledges to keep pensions triple lock
http://www.bbc.co.uk/news/uk-politics-38148520

Looks like the Toxic One won't be voting Labour.:)

Don't tell him that! It may be that his trust in Corbyn's Labour Party is all he has left.... if he knows that they are committed to supporting the present guarantees to pensioners, he might have to move his support to the next logical place... The Official Monster Raving Loony Party.:eek:

WR

ruggedtoast

As has been pointed out, most state pensioners are not yet boomers. The "Forgotten Generation" (certainly forgotten by the boomers) is not rich and should continue to receive boomer taxes.

Its in the next 5 years that the Triple Lock must go and "Generation Me" should start paying its own way for once.

Cornucopia

This is getting complicated now.

Will the triple-lock disappear only for Boomers (between ages 52 & 70), or will older (and in due course younger) pensioners still get it.

hildosaver

Cornucopia wrote: »

This is getting complicated now.

Will the triple-lock disappear only for Boomers (between ages 52 & 70), or will older (and in due course younger) pensioners still get it.

I'm assuming what is being proposed is that the triple-lock, the bus pass, the winter fuel payments, etc. should all be withdrawn for the 'Boomers' however let's be honest and say that once they are gone, they are gone for everyone (realistically) so maybe the feeling is, lets just stop it all now and be done with it?


Mind you, as you said, it is very confusing. Basically we are all screwed.

CLAPTON

ruggedtoast wrote: »

As has been pointed out, most state pensioners are not yet boomers. The "Forgotten Generation" (certainly forgotten by the boomers) is not rich and should continue to receive boomer taxes.

Its in the next 5 years that the Triple Lock must go and "Generation Me" should start paying its own way for once.

Looks like you will have to vote tory now that the Labour are promising to maintain the triple lock until at least 2025.
But what can you expect from a labour leadership comprised of rich boomers living in multi million pound houses and all with huge state index linked pensions to look forward to.

westernpromise

Wild_Rover wrote: »

Your average worker pays basic rate tax on everything earned above the personal allowance while someone else can achieve just as sizeable - or a much greater - income entirely tax free.

Only by saving money and putting it into ISAs, however, and the income from which such savings were found was savagely taxed to begin with. The average worker on £25k a year or whatever nets £20,167 after tax (19% deduction). To get that from an ISA, which according to this article
http://www.telegraph.co.uk/investing/funds/isa-fund-tips-best-uk-income-funds/
typically return 6.5% a year, you'd need to have £310,000 in it. That is more than 20 years of the current ISA allowance, which hasn't always been as high as it is, so it is a racing certainty that anyone who's been able to put £300k aside over 20 years has been a top rate tax payer throughout.

If they are on £120k a year they have no tax free personal allowance at all, and they would have £47,000 (39%) taken in tax. 20 years of that to accumulate the necessary £300k ISA funds means they've paid nearly a million pounds in tax, This is ten times as much tax as is paid by the worker on £25k on less than 5x his income, and after tax and saving into the ISA, they have rather less than 3x his take-home pay.

So it is very, very wide of the mark to suggest that they have achieved this " income entirely tax free". The only real tax free income is that of people who get in-work benefits in excess of the tax deducted, which would certainly describe a lot of people on £25k a year, and the majority of people in Scotland. If someone like that gets more than £4,832 a year in cash benefits, they are paying no tax at all - and this is before considering what public spending is for their indirect non-cash benefit.

westernpromise

Cornucopia wrote: »

This is getting complicated now.

Will the triple-lock disappear only for Boomers (between ages 52 & 70), or will older (and in due course younger) pensioners still get it.

Neither, Toastie will just campaign on a platform of deliberately impoverishing pensioners and making them live and die in freezing homes, because they're just filth.