Can we talk about £100-120k marginal tax rate
Discussion
mattmurdock said:
turbobloke said:
Yes but you've been working hard using in-demand skills that you had to take the trouble to acquire and then use to gain work in the marketplace while already becoming liable for lots and lots of tax before hitting £100k. This means it's only "fair" that you pay another lot after £100k via loss of allowance because you dared to work so hard and be liable for so much tax already. No matter, just focus on the fairness of it all and how you'll have a warm glow of fairness after coughing up several tens of thousands in tax.
Pity us poor guys on PAYE over £100k, no chance to use dividends to limit the tax bill - can't say fairer than that 
.As someone actually paying this marginal tax rate, frankly I think the moaning is a little overdone. A healthy combination of talent, hard work, luck and opportunity has given me plenty, and choosing to live in a civilized country where we get (effectively) free healthcare and those who have fallen on hard times are supported means I do not begrudge the amount of tax I pay.
said:
No tax system is ever going to be fair to all.
Noooooo...are you saying it's not fair after all 
Hang on, it's focusing on this fairness thing that's the problem - who started it?!
Welshbeef said:
Who created this quirk where you pay the highest marginal rate of tax of all?
What should someone earning in this range pay more marginal tax than someone on double the salary.
Why is the starting point not increasing at all since its inception?
Why was £100k selected as the starting point?
Why not instead reverse it entirely and give the income tax free level to all but lower the 45% starting point to balance off the tax lost.
And that is the reason I got married.What should someone earning in this range pay more marginal tax than someone on double the salary.
Why is the starting point not increasing at all since its inception?
Why was £100k selected as the starting point?
Why not instead reverse it entirely and give the income tax free level to all but lower the 45% starting point to balance off the tax lost.
We share the profits in the business so like to keep the profit down to 199,999
hunton69 said:
Welshbeef said:
Who created this quirk where you pay the highest marginal rate of tax of all?
What should someone earning in this range pay more marginal tax than someone on double the salary.
Why is the starting point not increasing at all since its inception?
Why was £100k selected as the starting point?
Why not instead reverse it entirely and give the income tax free level to all but lower the 45% starting point to balance off the tax lost.
And that is the reason I got married.What should someone earning in this range pay more marginal tax than someone on double the salary.
Why is the starting point not increasing at all since its inception?
Why was £100k selected as the starting point?
Why not instead reverse it entirely and give the income tax free level to all but lower the 45% starting point to balance off the tax lost.
We share the profits in the business so like to keep the profit down to 199,999
turbobloke said:
Noooooo...are you saying it's not fair after all
Hang on, it's focusing on this fairness thing that's the problem - who started it?!
The OP. My idea for a fair tax system is to abolish all taxes (including corporate) and run the country on voluntary contributions. That way no one could complain it was unfair as everyone could contribute what they felt was equitable. Hang on, it's focusing on this fairness thing that's the problem - who started it?!
Effective marginal rates, whether via benefits, NI or taxation are up & down all over the salary scales. This makes for a cumbersome system that does nothing for simplicity & fairness. The whole thing needs reforming from top to bottom.
As a former PAYE employee the removal of personal allowances was for me the final straw. Paying 62% tax was not on, nor fair. I now pay 0% on my full income. In my case that final raise, has ensured HMRC now receives nothing!
As a former PAYE employee the removal of personal allowances was for me the final straw. Paying 62% tax was not on, nor fair. I now pay 0% on my full income. In my case that final raise, has ensured HMRC now receives nothing!
GT03ROB said:
Effective marginal rates, whether via benefits, NI or taxation are up & down all over the salary scales. This makes for a cumbersome system that does nothing for simplicity & fairness. The whole thing needs reforming from top to bottom.
As a former PAYE employee the removal of personal allowances was for me the final straw. Paying 62% tax was not on, nor fair. I now pay 0% on my full income. In my case that final raise, has ensured HMRC now receives nothing!
Spill the beans then. Or are you in prisonAs a former PAYE employee the removal of personal allowances was for me the final straw. Paying 62% tax was not on, nor fair. I now pay 0% on my full income. In my case that final raise, has ensured HMRC now receives nothing!
Piersman2 said:
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I almost cacked myself because I'd been out of work for 5 months after that contract and had used up most of my buffer. Thankfully, the accountant was able to take into account the 5 months off and significantly reduce my payment on account as a result.
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You need a better accountant. They should have given you plenty of warning on this and helped you with the options available...I almost cacked myself because I'd been out of work for 5 months after that contract and had used up most of my buffer. Thankfully, the accountant was able to take into account the 5 months off and significantly reduce my payment on account as a result.
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Murph7355 said:
Piersman2 said:
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I almost cacked myself because I'd been out of work for 5 months after that contract and had used up most of my buffer. Thankfully, the accountant was able to take into account the 5 months off and significantly reduce my payment on account as a result.
...
You need a better accountant. They should have given you plenty of warning on this and helped you with the options available...I almost cacked myself because I'd been out of work for 5 months after that contract and had used up most of my buffer. Thankfully, the accountant was able to take into account the 5 months off and significantly reduce my payment on account as a result.
...
But yes, I would have expected them to explain this to me when I questioned the excessive payment on account they'd calculated. It was only when I had to get my last 4 years of SA320s to support a mortgage application that I saw this one year with a massive jump in personal tax did some googling to see WTF was going on.
As alluded to a few posts back, when you start to see yourself paying what feels like large sums of tax, you begin to realise that it may be more efficient to spend some of your money and potentially avoid paying any tax what so ever!
42% was enough for me when Brown lifted the NI cap, they've had 9 years of nothing since.Piersman2 said:
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As alluded to a few posts back, when you start to see yourself paying what feels like large sums of tax, you begin to realise that it may be more efficient to spend some of your money and potentially avoid paying any tax what so ever!
A good accountant will generally save you his fees. And you are doing the country far more good by encouraging the employment of skilled individuals As alluded to a few posts back, when you start to see yourself paying what feels like large sums of tax, you begin to realise that it may be more efficient to spend some of your money and potentially avoid paying any tax what so ever!
Saving tax altogether essentially means going abroad. Living abroad is a truly great experience....but I have a young family now and enjoy them being near grand parents etc. So for the time being I'll contend with the current tax regime. Come retirement age (or sooner if a proper grip cannot be gained on the country's affairs) things might well be very different though.
It's a stupid situation.
I just take no more than £100k income of the business. Sometimes that means I'll take up to 6 months off during the year. I'm not rolling out of bed to earn more for HMRC than myself before I've even been taxed spending it. Maybe one day I'll grow the business to the point it'd be worth it anyway some years, but I don't see it happening at the moment.
Remove the rule and I'd pay more tax, but the media and opposition don't seem to care about tax take.
I just take no more than £100k income of the business. Sometimes that means I'll take up to 6 months off during the year. I'm not rolling out of bed to earn more for HMRC than myself before I've even been taxed spending it. Maybe one day I'll grow the business to the point it'd be worth it anyway some years, but I don't see it happening at the moment.
Remove the rule and I'd pay more tax, but the media and opposition don't seem to care about tax take.
0000 said:
It's a stupid situation.
I just take no more than £100k income of the business. Sometimes that means I'll take up to 6 months off during the year. I'm not rolling out of bed to earn more for HMRC than myself before I've even been taxed spending it. Maybe one day I'll grow the business to the point it'd be worth it anyway some years, but I don't see it happening at the moment.
Remove the rule and I'd pay more tax, but the media and opposition don't seem to care about tax take.
Which is where I find myself now. My current contract will end at the end of Feb. I can't take much more dividend until April 6th, so I might as well bank the next two invoices in the business, take no more divi's and not bother looking for another contract until at least April. Which is not such a bad thing, I could do with a few weeks off, it's been a long, stressy project with no holidays in two years so a break would be good anyways.I just take no more than £100k income of the business. Sometimes that means I'll take up to 6 months off during the year. I'm not rolling out of bed to earn more for HMRC than myself before I've even been taxed spending it. Maybe one day I'll grow the business to the point it'd be worth it anyway some years, but I don't see it happening at the moment.
Remove the rule and I'd pay more tax, but the media and opposition don't seem to care about tax take.
richie99 said:
It's an outrage and if we had a Conservative Chancellor he would sort out this and other iniquities. Instead the current one is busy introducing measures which further target those who are comfortably off but not rich with his 'broadest shoulders' bulls
t.
Quite!t. Osborne would have been perfectly happy serving as Blair's chancellor.
His policies on council tax and pensions go further than anything that Blair/Brown ever did.
He reminds me of Chris Huhne...
Smarmy.
Populist.
Self serving.
Couldn't care less what effect his policies have on the country as long as his career doesn't suffer.
I hit the first peak on the graph posted a few pages back, when a promotion took me from the £50k's to £60ks (pocket change on here, I know...)
Add in the higher NI rate and higher pension contribution rate that applies to the scheme I'm in, the marginal rate was well into the 60s.
But as a PAYE employee, 30 odd % of something is still better than 100% of nothing.
So I can't get too upset about it. I knew it would happen, and could have just sat where I was (though personally that wasn't an option I would have chosen).
Ian
Add in the higher NI rate and higher pension contribution rate that applies to the scheme I'm in, the marginal rate was well into the 60s.
But as a PAYE employee, 30 odd % of something is still better than 100% of nothing.
So I can't get too upset about it. I knew it would happen, and could have just sat where I was (though personally that wasn't an option I would have chosen).
Ian
hunton69 said:
GT03ROB said:
Effective marginal rates, whether via benefits, NI or taxation are up & down all over the salary scales. This makes for a cumbersome system that does nothing for simplicity & fairness. The whole thing needs reforming from top to bottom.
As a former PAYE employee the removal of personal allowances was for me the final straw. Paying 62% tax was not on, nor fair. I now pay 0% on my full income. In my case that final raise, has ensured HMRC now receives nothing!
Spill the beans then. Or are you in prisonAs a former PAYE employee the removal of personal allowances was for me the final straw. Paying 62% tax was not on, nor fair. I now pay 0% on my full income. In my case that final raise, has ensured HMRC now receives nothing!
GT03ROB said:
hunton69 said:
GT03ROB said:
Effective marginal rates, whether via benefits, NI or taxation are up & down all over the salary scales. This makes for a cumbersome system that does nothing for simplicity & fairness. The whole thing needs reforming from top to bottom.
As a former PAYE employee the removal of personal allowances was for me the final straw. Paying 62% tax was not on, nor fair. I now pay 0% on my full income. In my case that final raise, has ensured HMRC now receives nothing!
Spill the beans then. Or are you in prisonAs a former PAYE employee the removal of personal allowances was for me the final straw. Paying 62% tax was not on, nor fair. I now pay 0% on my full income. In my case that final raise, has ensured HMRC now receives nothing!
Ian Geary said:
I hit the first peak on the graph posted a few pages back, when a promotion took me from the £50k's to £60ks (pocket change on here, I know...)
Add in the higher NI rate and higher pension contribution rate that applies to the scheme I'm in, the marginal rate was well into the 60s.
But as a PAYE employee, 30 odd % of something is still better than 100% of nothing.
So I can't get too upset about it. I knew it would happen, and could have just sat where I was (though personally that wasn't an option I would have chosen).
Ian
Why are you including your pensions savings in you calculation of marginal tax??Add in the higher NI rate and higher pension contribution rate that applies to the scheme I'm in, the marginal rate was well into the 60s.
But as a PAYE employee, 30 odd % of something is still better than 100% of nothing.
So I can't get too upset about it. I knew it would happen, and could have just sat where I was (though personally that wasn't an option I would have chosen).
Ian
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