So child benefit to go for higher rate taxpayers(1017 Posts)
So says George osbourne on breakfast telly. Missed the details but sounds like it comes in from 2013!
And, if you own a home, will also depend on when you bought your first home.
PosieParker - really don't mean to sound as thick as my post probably does but have reached the age of 42 with no clue whatsoever on this subject and am genuinely interested in the possible outcome.
"I haven't had time to read the news, or the thread, but if a non earners tax allowance can be transferred then the only families this CB cut is affecting are HRT single parent families." And families where both parents are HRT.
''I haven't had time to read the news, or the thread, but if a non earners tax allowance can be transferred then the only families this CB cut is affecting are HRT single parent families. Typical!! ''
How is that so? My DH is a HRT payer, I am not, although I work full time. We will lose CB. Therefore we are affected
Jenten - Child Benefit rates are here.
Someone who has two children gets £20.30 for first child and £13.40 for second each subsequent child per week.
By my calculation, a 2 child family with one (or two) parents who are higher rate tax payers will lose £1758 per annum due to the proposed changes (before taking account of any transferable tax allowance announced this morning).
A family with more than two children loses another £699 per annum for each extra child.
merrymouse -thanks for that. I didn't realise it was quite that much. If the company you worked for threatened to reduce your salary by that amount you'd look for another position - right? No such choice here. That's how it would equate to my life. Alibaba = you think I'm a journalist? sorry to appear so shallow!
I have written to my M.P. Hearing David Cameron on the radio this morning pledging to keep his promises over winter fuel allowances and free bus passes made me so angry I nearly threw something
BeenBeta - "The party announced it would allow spouses who did not claim all their taxfree personal allowance to transfer £750 of it to their working partner.
However the measure, heavily watered down in the coalition agreement, would only apply to basic rate taxpayers, meaning those paying the higher rate of tax would still lose out."
If this is true then basic rate taxpayers with a SAHP/partner who is a low earner would gain £150 per year. But anyone on higher rate gets nothing. So that's ANOTHER £150 a year to add on to the black hole dip ccaused by going slightly into the HRT band.
£44000 - fine, and you can add on a tax break giving you another £150/year.
£44001 - you lose all your child benefit PLUS another £150.
It is not the principle of cutting back the CB for high earners that irks. It is the fact that the Tories are selling this policy as tough but fair.
DC's suggestion that tax allowances could be transferred would only mitigate the situation where one person pays HRT and the other is SAH. The other cases are not addressed. In his interviews he kept coming back to the notion of tough but fair. They seem to have to decided to dimisss accusations of unfairness (the £80,000 earning household) as problems on the margins and not applicable to a huge amount of people.
Philip Hammond on Newnight last night came up with the £70,000 median figure again for HRT payers.........
I don't think I know anyone who earns anywhere near £44k. Is that because I'm northern?
The 70k median is a red herring. For starters it is not the median of PARENTS, it is the median of HIGH EARNERS. Secondly, all it means is that there are as many above as below. But all the people below COULD be on 44k, there is not necessarily an even spread. So he could in fact be hitting approximately HALF of all higher-rate parents.
But hey, if the median is 70k then it must be fair. Mustn't it? er (osborne checks his GCSE maths book).
More interesting would be to give the mode, the average AND the median and to show the distribution curve. Only then could they say whether it was only a 'few' families.
Amazing how many of those families are on MN!
It would be fairer and cheaper to administer to just raise taxes for all higher rate taxpayers.
I haven't seen the details yet. Even if it means that we won't lose out I will still march against the government.
Why should a single parent earning £45k working their backside off lose out? What message does this give to our children? It tells them that they are insignificant. I worry for the future I really do. This shows that they are so out of touch with the masses and making it up as they go along.
Come on everyone lets get our kids out marching on the streets and give the tories a much needed kick up the backside!
"Asked about the future of winter fuel payments and free bus passes for wealthier pensioners, he said: "Obviously you have to wait for the spending review announcement but I made some pretty clear promises to pensioners in our country, and those are promises I want to keep."
I thought he made promises to keep child benefit
They are - another 1% NI coming soon, plus pay freezes, loss of CB from 2013, the threshold will drop as well for higher rate to 2k lower to ensure that there is no benefit from the extension of the lower rate band.
There is a limit Arctic to how much can be squeezed and have people willing to do their higher rate jobs. You are seeing that at the margins of the higher rate threshold here, with some saying they'll go p/t, or ask to be paid less to keep the cb.
going, I hate the term 'pensioners' It conjures up an image of frail old ladies warming soup.
The only 65 year olds I know have about 4 foreign holidays a year, a new conservatory and their winter fuel payment has gone towards some nice wicker furniture.
Obviously that's not the case for everyone but the very notion that everyone over the age of 65 needs assurances from the Government, to be paid for by everyone under the age of 65 (children included) is deeply offensive.
"I don't think I know anyone who earns anywhere near £44k. Is that because I'm northern?"
I think so.
Pressure on housing in the South East means that somebody looking at renting or buying a modest house (small semi maybe?) is looking at a monthly cost of £1,200 +. This wouldn't necessarily mean that they would live that close to their work and would have to add on commuting time and costs. You also have to balance commuting time against childcare costs.
Obviously if most of the jobs weren't in the South East, many of us wouldn't live here.
Frankly it seems as though it would be fairer to abolish it completely as a separate benefit, and integrate with Tax Credits which is fully means-tested.
Thanks for that Liybolero. WHen GO first mentioned the £70,000 yesterday on Today programme (he did not say which average it was but later people did at least say it was the median......) it thought there was something irrelevant about the figure but thanks for making clear why that was.
I was just grrrrrrr about the fact that the Chancellor himself could not get the basic notion of an average right. Obvioulsy you can pluck a figure out of the air to justify your point and the £70,000 median one is obvioulsy one that has been provided as a justification (I have heard it from three people so far). I think that it is very disingenuous of them.
This is my letter to my MP.
Feel free to cut and paste . Although not all the facts are entirely accurate, I'm not called rantyknickers for nothing.
I am writing to you to express my strong objections to your proposed reforms to child benefit. I feel this is the latest line in cuts which impose a disproportionate share of the burden on middle income families. My objections to your policy to abolish benefit when one parent earns more than £44,000 are on several levels.
I fully accept that cuts have to be made and that those high income households should share the burden. I also fully accept that there will also be people around the threshold who feel aggrieved. However, the anomolies in this system are so great and will affect such a large number of families that the policy is unworkable and unfair. The very fact that you can countenance a policy which allows a family with a household income of £45,000 to lose out, but a household with a joint income of £87000 to still receive the benefit is an outrage. I feel that this is a direct attack on those families who have chosen one parent to stay at home whilst the other works full time. Also, this is placing an unfair burden on those families with pre-school children, who are the most likely families to have a parent at home and for whom the option of working also raises the need for massive childcare costs. You are directly taking money from families at exactly the point that they need it most.
I distinctly remember your campaign poster of the election which said 'I've never voted Conservative but agree with their policy on familes'. If only voters had known then what your family policies actually were, the outcome of the election would be very different.
However my main objection is that your party appear to be making one generation bear all the burden of the tax cuts, and it is this generation who already have the greatest financial burden. For middle income families with young children, who are now about to lose their child benefit, are also faced with rising VAT (and this group will wear the brunt of this rise), the withdrawal of childcare tax credits, withdrawal of maternity grants, closure of Surestart centres, withdrawal of child trust fund payments. Added to this is over inflated house prices and the knowledge that we will have to fund our children's ever spiralling University costs or force them into a lifetime of debt.
This is a marked comparison with the older generation who, not only benefited from universal child benefit and free university education for their families, but also in the large part are sitting on large amounts of equity in their properties (which they bought before house price inflation took off), have most likely been able to build up a large pot of savings and possibly the security of a final salary pension and guaranteed state pension. Yet it is this group that you are making promises to, by refusing to countenance means testing state pensions or the withdrawal of the winter fuel allowances or free bus passes. This can only be an expedient policy caused by knowing where your core vote lies.
The climbdown on Capital Gains Tax is also a direct example of you responding to the vested interests of core voters at the expense of hard working families. The very notion that people can pay 40% tax on money that they go out and earn, but only need to pay 28% on money they haven't earned is irrational and unfair.
So yes, please reform child benefit if you must, but any means testing must be made fair and equal across all households. The argument that this cannot be done without great cost probably means that it should not be done at all, rather than should be done in this unequal and divisive way. Furthermore, if you must withdraw benefits from families you must adopt a fair approach across the board. This means the means testing of old aged pension, to withdraw them from high rate tax payers and the removal of free bus passes and winter fuel allowance for pensioners with more than £16,000 worth of savings (the same criteria you apply to housing benefit).
Thank you for taking the time to listen to my views.
No, going - GO promised to keep CHB, it was DC who promised to the pensioners. And its seen as politically more expedient for the chancellor to break his promises than the PM.
Yes I now realise it will affect families who have one HRT and a second earner, but cannot imagine this could cause real hardship to lose it, with 3 yrs warning as well. I know everyones circs are different but that would indicate a very comfortable income.
Jenten, I don't know anyone who is a HRT either, maybe my doctor, but I've never discussed it with her. I am up north in a low income/high cost of living tourist area. In the organisation I work in not one of the well educated employees earn above it, not even the big boss.
For all of you who voted Tory well what did you expect? Yes Labour weren't perfect but at least they have some idea of social justice. Whatever the Tories say it is never on their agenda.
My parents (staunch Tory voters) 'its boom and bust dear its boom and bust' - its amazing how they think that as a single parent I would qualify for loads of extras. Probably been reading the daily mail too much LOL
I too have written to my MP as I stand to lose £1700 per year tax free and I struggle - I am privately renting after divorce and once Ive paid rent, poll tax and utilities, childcare I have easily spent £2000.
Whether conscious or not its an attack on single parents.
However I believe too this may be the tip of the iceberg and wondered when they say that people would be better off in work than in benefits and when they put a cap on total level of benefits they are thinking of scrapping or vastly reducing WTC/CTC - in which case millions of families will be on their knees.
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