Labour Party proposals

haras_nosirrah

Pennywise wrote: »

The spanner in the works in employers NIC which is an extra 13.8% of the wage and thus makes a very big difference compared with taking the money as dividends. Employers NIC is actually why a lot of "one man" company owners take dividends. If it were just PAYE and employees NIC, there probably wouldn't be the same incentive to pay dividends. What they need to do is remove employers NIC for director/shareholders of close companies and then you really are levelling the playing field.

This was why mine was done this way
It isn't the employee nic, it is both employer and employee nic which makes the difference.

If I take 50k as a salary then I have to pay employer NIC of £5709 plus £4964 in my own NIC and tax of £7500 so total of £18,173 in tax and NI or an effective tax and NI rate of 36.34% compared to a employee (who also gets sick pay, pension, maternity etc etc) being taxed at 24.92% on 50k

DairyQueen

haras_nosirrah wrote: »

This was why mine was done this way
It isn't the employee nic, it is both employer and employee nic which makes the difference.

If I take 50k as a salary then I have to pay employer NIC of £5709 plus £4964 in my own NIC and tax of £7500 so total of £18,173 in tax and NI or an effective tax and NI rate of 36.34% compared to a employee (who also gets sick pay, pension, maternity etc etc) being taxed at 24.92% on 50k

Exactly the same for my OH.

So, those who take-on the extra risk and lack of security associated with self-employment will be penalised big-time. It seems that the hard-left haven't lost their appetite for punishing enterprise.

We have already decided that OH will not resort to tax extortion. We are fortunate that he will be able to bring forward his retirement to next April if Labour wins. I wonder how many more highly productive people will re-arrange their employment situations and will pay less, not more, tax as a result?

The hard-left never seem to get that a lower rate of something is better than a higher rate of nothing. People don't just sit and take it, they vote with their feet.

uknick

Conservatives haven't been much better in helping small one man Ltd companies. They introduced the £5k dividend allowance and then reduced it to £2k a couple of years later. They introduced the employer national insurance allowance and then removed it for companies that only employed one person, the director.

Pennywise

uknick wrote: »

Conservatives haven't been much better in helping small one man Ltd companies. They introduced the £5k dividend allowance and then reduced it to £2k a couple of years later. They introduced the employer national insurance allowance and then removed it for companies that only employed one person, the director.

A hell of a lot better than forcing company owners to pay themselves fully under PAYE by imposing arbitrary limits on dividends which has been a proposal in the past.

The personal dividend tax narrows the gap between tax/NIC paid by a self employed sole trader and a one man limited company taking a mix of wages/dividends, both earning the same profits.

It was always an unfair anomaly that a limited company one man band could pay less tax than a sole trader earning the same profit (Thanks, Gordon for that!). The only fair way is that people earning the same amount paid similar tax whether sole trader or limited company and we're pretty close to that now.

It was a madness caused by Brown that the likes of window cleaners, odd job men, etc were converting to limited companies to save tax as opposed to remaining as sole traders.

pjb19

Pennywise wrote: »

Unless your a middle/upper earning public sector worker where Labour want to protect you, which gets themselves tied up in knots as they're not really for "the poor" - they're for union dominated industries and the public sector and those living on benefits. Plenty of "poor" working people they don't give a toss about.

Which ones would they be then, Coal, Steel, Shipbuilding??

pjb19

As a small business owner who relies on the road network, I appreciate that if I pay more (yes I will) I will get improved roads, better schools for my children, better social care for my elderly relatives and a bettter health service for all of us. I dont want to pay more (who does) but I recognise it's not just about me.


I'm fed up with seeing ex service personnel waiting for mental health and roaming the streets homeless, I dont want to feel frightened of going out at night because of a lack of police. I dont feel punished for being a small business I feel priveleged to be able to live here in safety and know that my loved ones and yours are looked after.



Overall I'm okay with paying more in. Thank you for reading.

DairyQueen

pjb19 wrote: »

As a small business owner who relies on the road network, I appreciate that if I pay more (yes I will) I will get improved roads, better schools for my children, better social care for my elderly relatives and a bettter health service for all of us. I dont want to pay more (who does) but I recognise it's not just about me.


I'm fed up with seeing ex service personnel waiting for mental health and roaming the streets homeless, I dont want to feel frightened of going out at night because of a lack of police. I dont feel punished for being a small business I feel priveleged to be able to live here in safety and know that my loved ones and yours are looked after.



Overall I'm okay with paying more in. Thank you for reading.

I appear to have missed that in the Labour manifesto. Why one earth would you believe that a country hocked to the eyeballs would be able to provide all of these benefits beats me. Of course, in the short term all of these freebies woill be financed by borrowing. That will last only as long as credit is extended by overseas lenders. Been there, done there. 1970s.