To Stop Generating Taxable Income?

Correct. Or if you’re unfortunate enough to live in Scotland the marginal rate of tax and Nic in this bracket is 69.5%.
So you work 7/10th of the week to give the money to the government.

We all know the reporting about migrant hotels is misleading. Don't believe everything the likes of Farage and Robinson spout.

Oh really?? You will have to sue several newspapers and broadcasters then - won't you? Or do you not follow the news at all e.g. about The Bell Hotel etc?
Keep up at the back.

You can do it. ISA income isn't taxed at all so saving towards that from a young age and suddenly you are paying quite a lot less tax. it's very much part of my future planning and my DC have had ISA's from birth to give them exactly this choice.

I think I’m getting your appointments as never any trouble where I live ( I must stress I go once in a blue moon) . It’s so unfair .

For the OP, if you actually have the assets to retire early, i suggest you seek out resources for the FIRE (financial independence retire early) community. There is a ton written out there by people on the path and those already arrived. This isn’t the correct website.

Also, you still pay taxes unless you are in the US and can craft your investments very carefully.

But the dependency ratio is a ginormous fish to fry and realistically landlords paying NI won't even make a dent on the problem. Meanwhile the impact this could have on a private rental market already in crisis is huge and immediate. 20% of people rent privately so we aren't taking about a tiny minority.

But that is only one social need. A minority of the population live in private rental, whereas everyone is affected by the dependency ratios. It certainly is indulging people to deprioritise the bigger of the two problems. And we clearly aren't doing what we can to keep supply up.

Naturally we shouldn't blindly look to tax assets or wealth, but this is why the 2% NI increase, which was a bad idea anyway, needs to be looked at. Its the opposite of blind, unlike its introduction. Having something that's basically a tax that you don't have to pay if you're a certain age and/or derive the income from assets was something thwt, as you say, was possible with a different demographic.

The current model does suit social needs in that it is not disincentivising landlords further from the private rental market at a time when we desperately need decent housing stock. The crisis is here now for many people looking to rent and it certainly isn't a matter of indulging people to try and do what we can to keep rents down and supply up.

I agree with you that we can't tax worker to infinitum. I disagree that we blindly look to tax assets or wealth without very careful consideration of the wider implications of doing this and whether the whole exercise could become counter productive and cause immense economic harm.

I'm afraid the answer is that we need to make cuts and be honest about this. What was possible with a different demographic and growing economy isn't possible now.

The point is that the current model doesn't suit social needs now. Again, the proportion of working age people relative to dependents is going to get worse, and it's not good now! There simply isn't time to indulge ourselves. Have a look at some population pyramids. We can't really do a lot to change that, even with more immigration a lot of it is baked in due to low TFR and relatively high life expectancy, whereas we do actually have the power to change our systems around housebuilding. However you want to slice this, it would be less difficult. And this thread is an example of what happens when workers decide the juice isn't worth the squeeze.

This is why it's such a bad idea to have a taxation system where income from labour is taxed more than that from assets.

I do actually think we probably have to learn the housebuilding lesson the hard way for a while longer yet, because of the level of wishful thinking people engage in on the subject. But the proposal to lessen NI by 2% and add it to income tax would be a good start.

But most landlords are also workers so it's not like they represent some massive untapped labour resource. It is also true that some landlords will be too old to work so again they won't work even if they give up being a landlord.

We also don't seem to be able to build more houses. Successive governments have promised this and very little has actually been achieved. The current Labour government looks like it's also failing in this regard. As I mentioned in my post earlier, once we have the new houses built and rented then we can look at making reforms to taxation on landlords in the knowledge that the market won't be too drastically impacted, you can't do this preemptively when we know that actually building new houses in the UK is really hard for a plethora of reasons.

Finally, there is nothing intrinsically wrong with sources of income being taxed differently if it suits the societal needs at the time. We need to be very careful about cutting off our nose to spite our face in the pursuit of fairness.

You've just lost 98% of interest with this comment.

You have so much money you don't have to work. Don't then!

For those who are working people, the income from their rentals won't be subjected to NI whereas their work income will. This discrepancy is the problem, not least because we have a shortage of workers in the UK.

And it is not one we can sustain because we don't have the demographics, whereas we can build more houses.

I am not sure why you are adamant that landlords can't also be working people. Most surveys suggest the majority of BTL landlords use rental income to supplement their wages. They are therefore on the other side of the dependency ratio than you're implying.

Your wider point about taxing income from assets is an interesting one. I do think it can be absolutely fine to offer preferential rates of tax to anything that we as a society want to incentivised at a given point in time. This can be encouraging environmentally friendly businesses or those that help meet a need in society. Right now we desperately need good quality, affordable housing. This disproportionately will benefit young adults who are more likely to rent and also more likely to be working than some other demographics. In this way, this will alleviate some of the overall cost of living burden placed on working people so even if on paper you can get more state contributions from landlords this is counterproductive if they just effectively pass this tax on to working people.

🎯

Fully agree. I've cut back on some work just so I don't pay more tax.

If the government refuse to cut spending then why should I work my arse off for less than half of the cash I generate?

When you put it like that it almost seems parasitical

I agree that as a result of adding tax to landlords landlords will leave the market and demand and supply rules mean that rents will soar even higher than just landlords passing extra tax on. But we need to sort out the housing market properly. Solutions have to be found. We cannot just carry on with half hearted efforts.

We need to do drastic things like banning airB&B from operating here. Making council tax on short term lets / second homes 10 x that of homes, indeed closing loopholes to prevent short term lets avoiding council tax. We need to incentivise investment companies to enter the build to rent residential market. We need to plough capital investment budgets into building social housing for all who want it. We can’t keep pissing around.

This X a million.

Agree. DH been made redundant from 6 fig salary. He is now looking for jobs around 45K. Never claimed anything benefit wise Inc child benefit in our lives, used private healthcare + although used state primary our DD is now in independent secondary school, always paid all taxes owing, for what? To be blamed for all of society's problems. Well fuck it, why should he half kill himself just to face yet more tax.
So he's out, cut back all charity donations (previously 10% of gross salary), child will go to the best state 6th form in the county, stopped private healthcare just at the moment we will start costing NHS money (late 40s) and we will just sit on any money we've got instead of contributing to the economy.

We aren't the only ones doing this either.

This would perhaps be a reasonable argument in a society that didnt have our dependency ratios. You haven't even considered that part of our reality at all, speaking of realism. The private rental sector is only one aspect of the picture.

Are you truly saying you think it's fine and indeed realistic to have a disproportionate share of the tax burden fall on people who are working, with preferential rates for those over a certain age and whose income is derived from asset ownership? And if so, since people working in jobs are liable to become a smaller proportion of the population over time (due to population pyramid) is there a point when you'd accept that needed to change?

I think this is a cart before the horse idea yet again.

If (big if!) any government is capable of actually building more houses and somehow a large proportion of these houses entered the private rental market at an affordable rental price then we could consider taxing landlords in an effort to even up earned Vs unearned income as a point of principle. However, we currently exist in a reality where landlords are already leaving the private rental market in droves, there is already a massive shortage in the sector and any taxes or additional costs are being passed on to tenants often out of necessity. House building completion numbers look terrible, planning applications for new houses are down and it just doesn't look particularly realistic that all this new housing is going to actually be built.

In this climate, it is madness to target landlords yet again with effectively more taxation. Governments should use the taxation system to incentivised what we want (more responsible landlords offering quality housing at a reasonable price) and disincentivising what we don't want (good landlords leaving the sector and decreasing supply further).

That possibility is better than the existing, definite system of having tax policy disproportionately focused on labour, yes.

We simply cannot afford to give preferential treatment to non-work income in a society with our demographics. I would prefer to get rid of NI entirely and roll it up with income tax, but this would be a start. The need for housing would be better tackled by building more than it is by privileging capital over labour in the vague hope that landlords will behave like we want them to.

It would be a privilege if high earners were chosen through some kind of lottery system and hours and responsibility wasn't almost always directly correlated with earnings.

I have done all kinds of jobs in my life and most lower paid jobs have less responsibility and expectations. I did the work that was expected of me, sometimes dealt with some difficult people and situations and clocked off at the right time. I have also had more senior, highly paid jobs where the buck stopped with me, I was expected to work evenings, weekends for free and had the stress of managing people and huge amounts of money. Expectations were through the roof and I was paid accordingly. I also had to get into a lot of debt to get the qualifications needed for the higher paid job and move many miles away from where I would ideally live to pursue the opportunity.

For someone to then act as if all this sacrifice and striving is a privilege and somehow based on luck is ridiculous. We need to encourage people to push themselves, upskill and take risks to grow the economy. People aren't stupid though and won't do this for the privilege of losing any extra reward through taxation. We are in a precarious situation where everyone needs economic growth. This will come from entrepreneurs and those willing to really put themselves out to achieve something. We are at real risk of alienating these people through taxation and talk of privilege rather than achievement.

Yes, the marginal rate between £100-125k is 60% 62% inc national insurance.

Then it goes down to 45%.

Does that make sense? If yes - why?