Guest 640- Registered: 21 Apr 2007
- Posts: 7,819
1 February 2011
10:4990947#1
At last the Coalition seems to have listened to the needs of the poorer people amongst us as the lowest paid will soon be lifted out of paying income tax altogether.
From April this year the lowest paid will be allowed to earn as I understand it and heavens Im not a tax specialist..but as far as I can understand it, will be allowed to earn up to £7475.00 per year without paying tax at all.
As much as it grieves me to admit it, I have a feeling this was a Libdem move rather than a Tory move and perhaps even coming from the pen of Nick Clegg himself. Clegg did promise all along that he would take the lowest paid out of income tax altogether and by jove he appears to have done it.
But we are soooo used to politicians scandalously breaking promises, and sadly the worst of these was Nick Clegg as any student will tell you, so when they deliver on something promised one nearly falls over in shock and palpitation.
People earning up to £35,000 a year will also be better off. This lenient tax approach encourages people to get up and go out to work which is a very good thing all round. Those established in work..ie those earning OVER £35,000 a year will pay considerably more Tax. But from a socialist point of view thats all very good as far as Im concerned. The right people are being targeted which isnt always the case.
So at last a bit of good news from the Coalition.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
1 February 2011
10:5990948#2
PaulB - this was announced in George Osborne's emergency budget so its not new and the intention is to steadily increase it to £10,000.
Yes this was a LD demand in the agreement but is certainly in-line with Conservative tax thinking (right back to Mrs T...) and very much supported by the right wing of the Party.
There is speculation that he may go further in the budget than this.
Brian Dixon
- Location: Dover
- Registered: 23 Sep 2008
- Posts: 23,940
1 February 2011
11:4990952#3
but it only gives the low paid workers a short reprive.but the higher earners will benifit in the long run.
howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
1 February 2011
12:1490957#4
i think it is a long term thing brian, there is a general view across the political spectrum that work has to be more profitable than a life on benefits.
the problem is still the jobs for people to fill, since we came out of recession only 3% of new jobs have been full time.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
1 February 2011
12:5790968#5
Brian - How come?
The basic rate band is being reduced so that higher rate taxpayers do not benefit from this.
A mistake to do that in my view as far too many people are now being caught in the 40% tax bracket. I hope that if, as has been suggested, a further £500 increase on top of whats been announced that that at least gets reflected in the higher bands.
Our tax system is far too complex after Browns meddling, as well as being too high. Simplification is desperately needs as well as lower taxes for everyone.
This week, incidentally, an IFS report says that middle and higher income earners will be the worse hit by the changes. Not exactly a surprise.
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
1 February 2011
14:0490979#6
There is a very interesting article that can be found here:
http://www.spectator.co.uk/coffeehouse/6662858/osbornes-tax-headache.thtml
It points out that to raise the starting rate for income tax to £10,000 would cost the Treasury £5bn.
While the 50% tax rate is estimated to cost the Treasury £5bn.
So this suggests that the government could drop the 50p rate AND by doing so can fund an increase in the nil rate band to £10,000 helping the lower paid.
Seems a no-brainer to me, a complete win-win situation, except that 'he with no brains only Balls' will conveniently ignore estimates of what the 50p rate will lose the Treasury and attack the government for helping the higher paid......
Jan Higgins
- Location: Dover
- Registered: 5 Jul 2010
- Posts: 13,931
1 February 2011
15:5190992#7
I bet the low paid find they are no better off in the end as higher income means less Council Tax Benefit etc, so their spending power will be the same.
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I try to be neutral and polite but it is hard and getting even more difficult at times.
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Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
1 February 2011
16:1090997#8
Not necessarily Jan. I am not an expert in Council Tax benefits but I do know a lot about individuals income tax positions as I deal professionally with a lot of people. The main gainers from this would be:
1/ Working wives who are on a low/part-time income. Many if not all would not be getting benefits or if WTC and CTC these are based on gross not net income.
2/ Youngsters getting into work starting on low pay and those previously unemployed, likewise.
Also everyone working who is a basic rate taxpayer will benefit.
I would suggest that most people who are working and are not higher rate taxpayers will benefit with very few indeed set to lose anything.
Brian Dixon- Location: Dover
- Registered: 23 Sep 2008
- Posts: 23,940
1 February 2011
17:3691016#9
heard the report on the news last night,it went into quite a deatail backed by fiscal study.
DT1- Location: Dover
- Registered: 15 Apr 2008
- Posts: 1,116
1 February 2011
18:5391027#10
Putting like that Barry, it all seems very good.
If we could now get Mr Osbourne and others like him to pay their taxes, rather than exploiting loopholes, we'd really be getting somewhere.
howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
1 February 2011
18:5791030#11
touche ddt.
apparently the coalition are cracking down on this, even getting details of undeclare overseas bank accounts.
could ruffle the feathers of one or two of our members, did i hear posh say anything?
Jan Higgins- Location: Dover
- Registered: 5 Jul 2010
- Posts: 13,931
1 February 2011
19:3691036#12
Barry, what about the tax paying pensioner like myself, a lot of us pay tax on our private pension income.
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I try to be neutral and polite but it is hard and getting even more difficult at times.
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Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
1 February 2011
20:3191058#13
Yes, Jan - if you are over 65 you get an age allowance as well as the normal allowance. This year the age allowance increases your tax-free income to £9,490 from £6,475 that applies to us under 65.
I do not know whether the £3k age allowance will rise with the increased personal tax allowance and I suppose we will find out in the budget. But, of course, if your income is sufficient you too would benefit from higher nil rate band anyway.
Incidentally, if your taxable income over age 65 is £22,900 or more then the age allowance is lost and at approx £29,000 you would have only the standard personal allowance left.
DT - Do you know something about George Osborne's tax affairs that no-one else does? Be a bit careful answering if I was you... I would hope that GO does get some sensible financial advice such as I provide to my clients on how they can mitigate their tax so they only pay what they are legally obliged to pay. Such as saving many pensioners from losing their age allowance (mentioned above) unnecessarily. Its not only the wealthy who can gain from sensible tax planning.
Brian Dixon- Location: Dover
- Registered: 23 Sep 2008
- Posts: 23,940
1 February 2011
21:2391066#14
barryw,if you have got iplayer facilatys try the ten o clock bbc news and listen carefully.
Guest 649- Registered: 12 Mar 2008
- Posts: 14,118
1 February 2011
22:1391080#15
Yes I am very unhappy I have just got a tax bill in for over £800 and all I get is my OAP .
DT1- Location: Dover
- Registered: 15 Apr 2008
- Posts: 1,116
1 February 2011
23:2191091#16
I know as much as the rest of the general public about Mr Osborne's tax affairs. And as far as I am concerned what he chooses to do is perfectly legal and I'm sure well advised (let's face it he can afford the advice).
But then it is also legal to turn down 'suitable' employment even though you are on job seeker's allowance because it is more in your favour not to work. Equally acceptable then.
It's a good job our country is being run by such arbiters of morality.
Jan Higgins- Location: Dover
- Registered: 5 Jul 2010
- Posts: 13,931
1 February 2011
23:2891093#17
Thank you Barry, I am still not sure how it will affect me, luckily I am OK financialy but I know one of our ladies will be happy, she has just paid her tax bill.
Vic, if all you get is the state pension I think you should seek help, I would have thought with no private income you should not pay tax, but I could easily be wrong.
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I try to be neutral and polite but it is hard and getting even more difficult at times.
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DT1- Location: Dover
- Registered: 15 Apr 2008
- Posts: 1,116
1 February 2011
23:3391095#18
As for being careful, I think numerous media sources (although none run by Mr Murdoch funnily!) have exposed these inconsistencies. I found it quite funny that the Daily Mail group and the Telegraph decided not to run ads (funded by the general public) portraying Mr Osborne as 'the artful dodger', because of his 'sensible financial advice'.
I can't understand why the Barclay Brothers or Viscount Rothermere would object? Anyone would think they were being creative with their tax payments!!!
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
1 February 2011
23:3591096#19
As long as it is legal tax planning then there is no problem at all. Everyone is entitled to minimise the tax tax they pay using all the legal methods to do so available to them. And so it should be.
DT1- Location: Dover
- Registered: 15 Apr 2008
- Posts: 1,116
1 February 2011
23:3891098#20
It used to be legal to smoke opium but I'm not sure I agree with that either.