State and private pensions have gone up, but I'm worse off

ClashCityRocker1

I think I'm right in saying that unless you have your code adjusted to reclaim tax you owe then an increase in your pension such as that described by OP WILL make you better off over the year (ignoring inflation obviously)

Veloflyer

What else do you expect HMRC or anyone else to do if people can't be bothered to read the swathes of information available? You can lead a horse to water…

In this particular case and given the links mentioned I would broadly agree with the sentiment. However, in many other situations, HMRC is very unclear. There may also be swathes of information on the subject, but most folk do not have the time or the ability - the expertise of a Bletchley Park codebreaker even - to decipher it. I have often though this is deliberate as in making many aspects of tax extremely prolix and complex, it precludes any challenge to HMRC from most folk. Famously, even Einstein is quoted as not being able to understand it. Hence the questions and answers on this forum I guess - which I for one find most helpful - but it should not be this way. Tax should be far simpler and not be a vehicle for an entire industry of tax lawyers.

eskbanker

Famously, even Einstein is quoted as not being able to understand it

Not convinced about that - he is widely quoted as making a different point: "If you can't explain it simply, you don't understand it well enough", but that's not the same thing!

Obviously many share the view that tax should be simpler, but the fact that generations of legislators have created complexity doesn't actually impose any obligation on HMRC to act as consultants, as their role is administration and enforcement rather than explanation and simplification…

Silvertabby

I tried to answer a similar question on another board, and couldn't explain why the OP was adamant that they were substantially worse off despite the triple lock increase to their State pension and CPI to their occupational pension.

Then the OP said they had included the increases to council tax, fuel, food, etc..…

Veloflyer

https://forums.moneysavingexpert.com/discussion/comment/81974532#Comment_81974532

Tax lawyers would not share the view that tax should be simpler. I am not particularly apportioning blame to HMRC for the complexity, merely highlighting the issue that much of tax is beyond the ken of many folk who pay it. That is unacceptable. Such complexity and lack of transparency erodes trust, understanding and mutual co-operation between HMG and the taxpayer.

Marcon

https://forums.moneysavingexpert.com/discussion/comment/81974516#Comment_81974516

Simply saying 'tax should be simpler' doesn't actually have any impact on anything, unfortunately. Aspirational thinking is fine, but people have to deal with the real world, insofar as anything relating to pensions or tax can be viewed as operating in the same universe as the rest of life…and I think you might have overlooked this: https://www.gov.uk/government/news/update-on-the-closure-of-the-office-of-tax-simplification

Given what happened when the government of the day decided to 'simplify' pensions I'd sooner they didn't try anything similar with tax… Twenty years on we are still struggling with the added complexities.

Veloflyer

https://forums.moneysavingexpert.com/discussion/comment/81974721#Comment_81974721

…and why can't the real world be simpler instead of increasingly complex? It is a fallacy to suggest that many things in the real world, tax and pensions in particular, should not be as simple as feasibly possible so the maximum number of folk can understand it. I still maintain it is as deliberately complex as possible so control over our lives may be maximised, so revenue may be maximised, and that those in the "industry" do little about it as turkeys don't vote for Christmas. The fact that politicians have tried to "simplify" pensions tells us nothing about simplification or ensuring such matters are better understood.

westv

Normally when companies say they are making things "simpler" it means "more expensive"

eskbanker

https://forums.moneysavingexpert.com/discussion/comment/81974694#Comment_81974694

I think the truth lies somewhere in between - I'm certainly not trying to defend the complexity of the tax system as such (although it's an entirely different conversation as to what is realistically possible to do about that, starting from where we are now), but conversely it's clear from many threads on this board that there are plenty out there who make no effort at all to understand the current regime, even though the information is readily available, and hence all the indignant "I have >35 years of NI so why don't I get the full state pension" threads and the like.

QrizB

although it's an entirely different conversation as to what is realistically possible to do about that, starting from where we are now

Hypothetically, the Chancellor could stand up in the House on budget day and say something like "from April 2029 we will be reforming the UK tax code into this" and then plonk down a thinly-disguised copy of the <300-page Hong Kong tax code.

https://www.adamsmith.org/blog/tax-spending/what-we-need-to-do-is-obvious/

I'm sure all the predictable people would have conniptions ...