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Will MSE lobby the government to raise either PSA or ISA allowance?
Comments
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dunstonh said:I am advocating that normal middle class earners have any incentive to put money aside instead of spending it, which in turn just pushes inflation. It didn't take long during Covid lockdowns to put enough aside to now get pushed into paying tax when you now fix at 4-5%.The incentives are the pension wrapper and the ISA wrapper.
£20k a year ISA allowance, not dependent on income along with £3600 pension allowance, not dependent on income (higher if you earn more) allow you to build tax efficient pots of very large amounts within a relatively short period.0 -
pecunianonolet said:dunstonh said:I am advocating that normal middle class earners have any incentive to put money aside instead of spending it, which in turn just pushes inflation. It didn't take long during Covid lockdowns to put enough aside to now get pushed into paying tax when you now fix at 4-5%.The incentives are the pension wrapper and the ISA wrapper.
£20k a year ISA allowance, not dependent on income along with £3600 pension allowance, not dependent on income (higher if you earn more) allow you to build tax efficient pots of very large amounts within a relatively short period.
If you want an investment option that is in the 1% then you have to accept that the Government is unlikely to help you.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.2 -
dunstonh said:pecunianonolet said:dunstonh said:I am advocating that normal middle class earners have any incentive to put money aside instead of spending it, which in turn just pushes inflation. It didn't take long during Covid lockdowns to put enough aside to now get pushed into paying tax when you now fix at 4-5%.The incentives are the pension wrapper and the ISA wrapper.
£20k a year ISA allowance, not dependent on income along with £3600 pension allowance, not dependent on income (higher if you earn more) allow you to build tax efficient pots of very large amounts within a relatively short period.
If you want an investment option that is in the 1% then you have to accept that the Government is unlikely to help you.
I still think that many people are screwed by tax and inflation and end up poorer in the long term0 -
Would you say 50k is an above average salary, according to the figures above it would be so
Very much so.
From the ONS
The median average salary for all workers in the UK is £25,971.
The mean average salary for all workers in the UK is £31,447.
The median average salary for full-time workers in the UK is £31,285.
The mean average salary for full-time workers in the UK is £38,131.
The mean is higher than the median, because a small number of very highly paid people skews the figures
The mode average is lower still than the median
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Albermarle said:Would you say 50k is an above average salary, according to the figures above it would be so
Very much so.
From the ONS
The median average salary for all workers in the UK is £25,971.
The mean average salary for all workers in the UK is £31,447.
The median average salary for full-time workers in the UK is £31,285.
The mean average salary for full-time workers in the UK is £38,131.
The mean is higher than the median, because a small number of very highly paid people skews the figures
The mode average is lower still than the median
The average median of full time workers should be at around 50k and not 38k so less people would require constant support or top ups. Everyone should be able to maintain a basic standard of living and I don't see this being the case.0 -
intalex said:Albermarle said:The current tax free allowances are actually pretty generous by international standards. A saver in France, Ireland, Germany etc would love to be able to shelter £20k pa from tax !
Both the £20K and the £1K PSA, almost exclusively benefit the Top 20% and are of zero benefit to more than 50% of the population. So no chance they will get increased, just be glad they exist at all.1 -
pecunianonolet said:Albermarle said:Would you say 50k is an above average salary, according to the figures above it would be so
Very much so.
From the ONS
The median average salary for all workers in the UK is £25,971.
The mean average salary for all workers in the UK is £31,447.
The median average salary for full-time workers in the UK is £31,285.
The mean average salary for full-time workers in the UK is £38,131.
The mean is higher than the median, because a small number of very highly paid people skews the figures
The mode average is lower still than the median
The average median of full time workers should be at around 50k and not 38k so less people would require constant support or top ups. Everyone should be able to maintain a basic standard of living and I don't see this being the case.
25k median for all workers is low, meaning many will be significantly under that and that means a lot of people are poor, although they work full time.
Low paid workers often get tax credits and other benefits, especially if they have children.
Some would say ( and I guess you would) by doing this the government is effectively subsidising large companies to pay low wages, which is a bit mad.0 -
pecunianonolet said:
The average median of full time workers should be at around 50k1 -
Dazed_and_C0nfused said:intalex said:Albermarle said:The current tax free allowances are actually pretty generous by international standards. A saver in France, Ireland, Germany etc would love to be able to shelter £20k pa from tax !
Both the £20K and the £1K PSA, almost exclusively benefit the Top 20% and are of zero benefit to more than 50% of the population. So no chance they will get increased, just be glad they exist at all.0 -
Albermarle said:In an ideal world you are right, but would take some major economic, social and political shifts to get even close.
25k median for all workers is low, meaning many will be significantly under that and that means a lot of people are poor, although they work full time.
Low paid workers often get tax credits and other benefits, especially if they have children.
Some would say ( and I guess you would) by doing this the government is effectively subsidising large companies to pay low wages, which is a bit mad.
Example: I am on a regular basis in different warehouses, people work, in this case, there from 8am until 4:30pm Monday - Thursday and 8am - 4pm on Friday. When I ask them how their weekend was many tell me they work Saturday in their second job, some even a half day in their 3rd job on Sunday. They get paid slightly above living wage. 70% there are agency workers, 80% from foreign countries, massive labour shortage there since months. That warehouse company is struggling for space, is as busy as never before and the managing director tells me he has to turn down work as there is not enough labour but his customers don't want to pay more to allow him to attract more labour by better pay.
@eskbanker: In other countries e.g. Germany a 50k salary isn't seen as something extraordinary, still a good salary but in the UK you have income tax and national insurance deducted. In Germany you have deducted income tax, unemployment insurance, health insurance, pension insurance, caring insurance (those without kids pay a premium), and church tax if you are in the church but you can opt out for a fee. In turn state pensions are higher for most, you get a dentist appointment within a week, you can see a GP as you wish and no phone triage. Situation in caring sector and hospitals is not great due to staff shortages, etc. What I am trying to say is that a higher median leaves more in peoples pockets but ensures public services are better (not perfectly) funded. Also, more people contribute a little compared to a small group having to fund the majority. I would think that they are still competitive as a country...0
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