The Hard Life of the Defined-Benefit Scheme Member

DT2001

GunJack wrote: »

Not strictly true...tax relief?? And the ability to offset allsorts of expenses against tax??

Umm, I was thinking of employers contributions.
We all get tax relief even non tax payers.

One other point that I have come across recently having read a number of threads when people are ‘catching up’ on pension contributions is trying to put 100% of earnings in one year if self employed is not easy. Why? You do not know your relevant earnings until the following tax year.

Expenses, now that is an interesting one. Playing Devil’s Advocate I’d say, a friend of mine is employed and can claim for her uniform, professional fees and mileage when she regularly has to change locations. My OH is self employed, same profession, cannot claim for work clothes (as she can wear them for leisure time) or her commuting as her clinic is in one place but can claim for professional fees.

I would also reiterate that I have worked for a company providing a non contributory pension, a company that provided no pension and have been self employed. Personally I like the last option for its flexibility (I am in charge of making the life/work balance suitable for me) but know other friends who went back to employment for the knowledge of £x each month.

Andy_L

DT2001 wrote: »

Expenses, now that is an interesting one. Playing Devil’s Advocate I’d say, a friend of mine is employed and can claim for her uniform, professional fees and mileage when she regularly has to change locations. My OH is self employed, same profession, cannot claim for work clothes (as she can wear them for leisure time) or her commuting as her clinic is in one place but can claim for professional fees.

but, theoretically at least, the self-employed should be costing them into the amount they charge for their services.

Malthusian

DT2001 wrote: »

(Tongue in cheek) no mention of us, the self employed, who only have themselves contributing.

Because you don't have any management or shareholders above you creaming off part of the earnings from your labour. When an employee saves into an employer scheme and gets matching contributions, it simply means he sacrifices less of the fruits of his labour than an employee who does not sign up for matching contributions. However both their shares are still lower than that of a self-employed person, who gets 100% of their net product.

I am not being pejorative or Marxist about non-self-employment, that's the deal everyone signs up to.

Equally I am not underestimating the hard work and drive needed to be self-employed.

The non-self-employed only have themselves contributing as well. Employers do not pay in contributions out of the goodness of their heart. We use the term "free money" to encourage people to sign up for matching contributions, but you don't get something for nothing by contributing, rather if you don't contribute you give up something for nothing. That "something" is still money you earned.

DT2001

Andy_L wrote: »

but, theoretically at least, the self-employed should be costing them into the amount they charge for their services.

In private medical care the amount chargeable for treatment is fixed by insurance companies. In fact the amount payable has reduced whilst costs inevitably increased. Quite often the market drives the fee and not the changing cost.