The post you are reporting:
Howard, post 38, is exactly that what I have been writing.
I'm not sure if what I am explaining here actually is being comprehended:
1) Bonuses are always taxed as income. (So too are tips.)
2) Share company bonuses increase in size with higher salaries
This means, a worker on £25,000 a year will get a significantly lower bonus (if any) than an executive on £200,000 a year.
3) Share company executives usually give themselves (please note the wording) a bonus that is higher than their actual basic salary. OK, sometimes it may be "only" 50% of their salary.
4) So, if you are on £12,000 a year, firstly you are unlikely to be working for a SHARE COMPANY, secondly you will not "give yourself" a bonus of, say £6,000 to £12,000. You'd be lucky to get any bonus at all. Although £200 annually would be welcome.
5) A share company director on, say, £150,000 a year, is likely to get a bonus of tens of thousands of pounds, possibly a few hundred thousand.
One on a salary of £300,000 is likely to "give himself" a bonus of £1 million a year.
(This because he can do as he likes with the company's money when establishing his own earnings).
So, why does the Government not stop this ABSURD form of taking - misappropriating - of share holders money? Why does a person on a top salary (above £150,000 a year) need a bonus larger than his salary?
While someone on £12,000 a year gets no bonus (or £200 perhaps)?
My opinion: because every bonus is taxed, and the Government allows share company profits to be "bonused" (transformed into bonuses), because that way it is taxed higher. On a top salary at the 45p rate, a bonus is automatically taxed at 45p.
Claro?
This means, the like of an elitist Bullington Club Chancellor G. Osborne has a higher tax income in the Treasury to cover up his failed policies. Oh, Labour were exactly the same.
Share companies are effectively being taxed EXTRA by way of bonuses. Bonuses are an extra tax revenue to the Treasury.
OK?
For this to function, the Government needs chief executives of share companies to DRY OUT company funds, impeding company investment and expansion and detracting from share-holders' dividends. This drying out is done through top salaries + bonuses, which are all TAXED at the highest tax rate (currently 45%).
End of!
