Can we talk about £100-120k marginal tax rate
Discussion
RYH64E said:
Just to cheer you all up, my net profit for January is on track to break through the £100k mark for the first time ever 
, it's been a good start to the year. The only problem is that I can't take ibig chunks of money out without paying penal rates of tax, so the money accrues in my company bank account until such time as I can sell up and take advantage of entrepeneurs tax relief at 10%, if it's still available when I get to claim it. I'd rather not take the money at all if it means paying huge amounts of tax.
Nice work! I can't help but think when your business is worth millions there are more tax efficient ways of selling up than paying entrepeneurs relief, if you're prepared to come live in the sun for a tax year or two..., it's been a good start to the year. The only problem is that I can't take ibig chunks of money out without paying penal rates of tax, so the money accrues in my company bank account until such time as I can sell up and take advantage of entrepeneurs tax relief at 10%, if it's still available when I get to claim it. I'd rather not take the money at all if it means paying huge amounts of tax.fblm said:
FredClogs said:
amusingduck said:
iphonedyou said:
You're doubtless trying to wrap your head around what a marginal tax rate is.
Fancy rolling out your utopian zero-tax-below-£100k-100%-tax-after idea again?
We could all laugh together.
His idea was literally 100% tax after 100k?Fancy rolling out your utopian zero-tax-below-£100k-100%-tax-after idea again?
We could all laugh together.
...why would any company ever pay over 100k in that scenario
Have you been hit in the head Mr Six Figures?FredClogs said:
Why would the government need any money, we'd all be earning very close to six figures and we'd all be rich enough to afford private healthcare, private income protection etc.. etc... isn't that your lots utopian ideal? No taxes, no government meddling, everyone is paying for the services they use and super wealthy?
The gift that keeps on giving....RYH64E said:
Just to cheer you all up, my net profit for January is on track to break through the £100k mark for the first time ever , it's been a good start to the year. The only problem is that I can't take ibig chunks of money out without paying penal rates of tax, so the money accrues in my company bank account until such time as I can sell up and take advantage of entrepeneurs tax relief at 10%, if it's still available when I get to claim it. I'd rather not take the money at all if it means paying huge amounts of tax.
If you're making £100k pcm then you can afford to pay tax, your "tax" is no more a penal than the guy paying 20% on his average salary., it's been a good start to the year. The only problem is that I can't take ibig chunks of money out without paying penal rates of tax, so the money accrues in my company bank account until such time as I can sell up and take advantage of entrepeneurs tax relief at 10%, if it's still available when I get to claim it. I'd rather not take the money at all if it means paying huge amounts of tax.Congrats on being considerably richer than me though, be a sport and do the right thing.
FredClogs said:
If you're making £100k pcm then you can afford to pay tax, your "tax" is no more a penal than the guy paying 20% on his average salary.
Congrats on being considerably richer than me though, be a sport and do the right thing.
I paid about £200k in taxes last year, I think I've done my share and don't feel obliged to pay any more than the minimum I can get away with. Why don't you work a bit harder and contribute more yourself instead of asking others to pay even more than they already do?Congrats on being considerably richer than me though, be a sport and do the right thing.
And it's not £100k per month it's £100k this January, most months I get by on about half of that...
sidicks said:
FredClogs said:
If you're making £100k pcm then you can afford to pay tax, your "tax" is no more a penal than the guy paying 20% on his average salary.
Just because someone can afford to do something, does not make it appropriate or fair for them to do so.What has fair got to do with anything? It's no fair people are born with horrible genetic disorders or ugly faces, it's not fair that some people get hit by drunk drivers and some win the lottery.
Fair has nothing do with anything, you sound like my bleating 8 year old when I take her tablet from her.
From each according to his ability, to each according to his need - that's about the fairest system there is - and it works.
FredClogs said:
If you're making £100k pcm then you can afford to pay tax, your "tax" is no more a penal than the guy paying 20% on his average salary.
Congrats on being considerably richer than me though, be a sport and do the right thing.
Your wide of the mark (excl NI)Congrats on being considerably richer than me though, be a sport and do the right thing.
Average salary is £27k that individual will pay £3,280 tax meaning his marginal rate of tax is 12%
£100k situation is paying c£30k in income tax or 30% of his income
Now let's say average salary individual has 4 kids he gets child benefit equal to that salary as such he pays £0 effective tax.
Chap on £100k pays in £30k gets no benefits.
Is that fair?
Or what should be fair?
If it's as per your statement not being more punitive that on average salary then chap on £100k is due a nice tax reduction of £18k down to £12k tax.
FredClogs said:
Fair?
What has fair got to do with anything? It's no fair people are born with horrible genetic disorders or ugly faces, it's not fair that some people get hit by drunk drivers and some win the lottery.
Fair has nothing do with anything, you sound like my bleating 8 year old when I take her tablet from her.
From each according to his ability, to each according to his need - that's about the fairest system there is - and it works.
No doubt you could afford to pay more tax but you don't - why not?What has fair got to do with anything? It's no fair people are born with horrible genetic disorders or ugly faces, it's not fair that some people get hit by drunk drivers and some win the lottery.
Fair has nothing do with anything, you sound like my bleating 8 year old when I take her tablet from her.
From each according to his ability, to each according to his need - that's about the fairest system there is - and it works.
No doubt you could work harder / longer and earn more and therefore pay more tax, but you don't - why not?
RYH64E said:
FredClogs said:
If you're making £100k pcm then you can afford to pay tax, your "tax" is no more a penal than the guy paying 20% on his average salary.
Congrats on being considerably richer than me though, be a sport and do the right thing.
I paid about £200k in taxes last year, I think I've done my share and don't feel obliged to pay any more than the minimum I can get away with. Why don't you work a bit harder and contribute more yourself instead of asking others to pay even more than they already do?Congrats on being considerably richer than me though, be a sport and do the right thing.
And it's not £100k per month it's £100k this January, most months I get by on about half of that...
But you are a whole hunk of man obviously - can you lend me a tenner?
Welshbeef said:
FredClogs said:
If you're making £100k pcm then you can afford to pay tax, your "tax" is no more a penal than the guy paying 20% on his average salary.
Congrats on being considerably richer than me though, be a sport and do the right thing.
Your wide of the mark (excl NI)Congrats on being considerably richer than me though, be a sport and do the right thing.
Average salary is £27k that individual will pay £3,280 tax meaning his marginal rate of tax is 12%
£100k situation is paying c£30k in income tax or 30% of his income
Now let's say average salary individual has 4 kids he gets child benefit equal to that salary as such he pays £0 effective tax.
Chap on £100k pays in £30k gets no benefits.
Is that fair?
Or what should be fair?
If it's as per your statement not being more punitive that on average salary then chap on £100k is due a nice tax reduction of £18k down to £12k tax.
Alex said:
FredClogs said:
From each according to his ability, to each according to his need - that's about the fairest system there is - and it works.
Thank you, Karl Marx. History has proven that it doesn't work.I think you'll find plenty of high taxation countries, like those in Scandinavia or Western Europe or even the US which are preferable to the low income tax jurisdictions, I know where I'd rather live...
https://en.wikipedia.org/wiki/List_of_countries_by...
FredClogs said:
Why would the government need any money, we'd all be earning very close to six figures and we'd all be rich enough to afford private healthcare, private income protection etc.. etc... isn't that your lots utopian ideal? No taxes, no government meddling, everyone is paying for the services they use and super wealthy?
Priceless. By any chance do you wear slip on's Mr Six Figures?FredClogs said:
Has it? When was that?
I think you'll find plenty of high taxation countries, like those in Scandinavia or Western Europe or even the US which are preferable to the low income tax jurisdictions, I know where I'd rather live...
https://en.wikipedia.org/wiki/List_of_countries_by...
Given that you're a net drain on our system, we don't need you here - why don't you head off to Sweden?I think you'll find plenty of high taxation countries, like those in Scandinavia or Western Europe or even the US which are preferable to the low income tax jurisdictions, I know where I'd rather live...
https://en.wikipedia.org/wiki/List_of_countries_by...
survivalist said:
I think the point is that these are measures that have been (relatively) recently been introduced and are aimed at reducing benefits and increasing taxation on higher earners. Also the point at which they come into effect is rather arbitrary and arguably doesn't take account of the varying cost of living in different areas of the country or (especially in the case of Child Benefit) household income. What's interesting, other than people commenting on what they consider 'reasonable' and 'high' incomes is ultimately whether they influence people's behaviour in a negative way that affects us all.
An extreme example, but a single income household living earning 120k will take home almost exactly the same amount of net pay as a dual income household where each person earns £49,999. However the latter household will pay less than half the income tax and be eligible for child benefit. Personally I don't consider that fair, but appreciate the challenge in creating legislation that is.
There is no such thing as a fair tax system; as peoples idea of what is fair vary so wildly. One thing I would say is from a historical perspective income tax is actually quite low. In the 70's there were bands of up to 83% for normal income tax and up to 98% for some classes of investment income.An extreme example, but a single income household living earning 120k will take home almost exactly the same amount of net pay as a dual income household where each person earns £49,999. However the latter household will pay less than half the income tax and be eligible for child benefit. Personally I don't consider that fair, but appreciate the challenge in creating legislation that is.
The child benefit thing is really a bit of a red herring. The reasons behind the way it works has to do with deficiencies in the IT systems at HMRC and the DWP. Correcting those deficiencies would cost far more than the savings made from being able to take into account joint incomes in means testing child benefit.
sidicks said:
FredClogs said:
Has it? When was that?
I think you'll find plenty of high taxation countries, like those in Scandinavia or Western Europe or even the US which are preferable to the low income tax jurisdictions, I know where I'd rather live...
https://en.wikipedia.org/wiki/List_of_countries_by...
Given that you're a net drain on our system, we don't need you here - why don't you head off to Sweden?I think you'll find plenty of high taxation countries, like those in Scandinavia or Western Europe or even the US which are preferable to the low income tax jurisdictions, I know where I'd rather live...
https://en.wikipedia.org/wiki/List_of_countries_by...
Gassing Station | News, Politics & Economics | Top of Page | What's New | My Stuff