AIBU to think the £100k tax trap is unfair?

I think we partially agree. I don't find it astounding and a lot of disabilities don't allow insurance. Additionally, other people aren't in a position to afford the extra income. Take care.

Whom to vote for when you are socially liberal, but economically conservative? I don't want the right to get in and tamper with LGBT or Women's rights. Like the Conservatives did in the 80s with clause 28.

At the same time, I don't want the economy stifled in the way that it has under Labour.

Who are supplemented by those paying taxes who don’t have children, in part because they didn’t want the financial burden of paying for children.

I don’t understand this. The person can sacrifice sufficient salary to bring their tax code down, and potentially to receive certain benefits. And when they retire of course they will pay tax, we all do. But that future tax could well be at lower band than it would have been if not sacrificed.

I can however understand encouraging people to save for a pension by incentives. But why can someone reduce their salary to take them down a tax band, claim child benefit, get the childcare stuff, for buying a new car, I don’t get that.The person sacrificing tax will benefit straight away from various things and get a new car as well.

It’s weird that we have to go to a position of people thinking that keeping more of your own money is “being handed a life jacket”!

But then people on this thread have compared reducing your hours to keep more of your own money to reducing your hours to keep more of your fellow taxpayers money and I am no longer surprised.

Because it’s popular with the anti affluence attitudes endemic throughout the UK.

It’s not just Labour. The Tories left the 100k tax trap firmly in place despite having years to do something.

Insisting it’s simply Labour is hard of thinking.

My fellow traveller! Typically just a few independents. But none of the mainstream parties appear to cater to those of us of this mindset.

I think this is exactly right. I think under this government there won’t be any reform of these things though, and I just fear higher taxes. More net contributors will leave, and then they’ll need to raise more taxes again

And I dare say they would be called lucky and selfish for saving themselves by building a lifeboat and smug for offering space to people who have no lifeboat...

I’m with Kemi. Centrist Tory tax without the madcap reform policies.

I was Labour last time but not any more.

And that you should be grateful for the opportunity...

I suppose if I was used to other people picking up the tab, rather than paying my own way, I might see it that way too.

You were the first to suggest that reducing your hours to keep more of your own money and reducing your hours to keep more of your fellow taxpayers money is essentially the same thing.

I walked into that one! Or did I?

I said that both create the same perverse incentive to work less. “Keeping more of your own money” at £100k is neither morally nor economically the same as “keeping more of your fellow taxpayers’ money”.

A net contributor earning £95k a year and staying under the threshold, and a net recipient of taxpayers money staying under the threshold, occupy fundamentally different positions. Do you really expect me to believe you don't understand the difference?

Any tax or benefit change which results in lower income after a gross increase is unfair. This isn't say I think it should be corrected by decreasing the tax of people earning over £100K.

I think in a way, the cliff edge is similar to the iht boundary - but obviously worse because it's money you are currently earning.

(Ive never earned anything like 100k)

Having a stark line where above it, there is a punitive tax almost encourages people to tweak their affairs so they can avoid it...when if it was tapered or seen as more fair, that wouldnt be the case and more tax would potentially be collected.

I dont understand why if you earn over 100k you lose your personal.allowance when youre already paying a large chunk of income tax. There was a report this week on the news about the state pension going over the threshold for paying income tax for the first time, and it said (in effect),dont worry, those who were only just over the threshold wouldnt have to pay any tax ....and yet being only just over the threshold of 100k would be quite punitive in terms of tax.

Absolutely, no one chooses it, but the costs are the costs. If you can afford to meet the costs why should it be paid? Same as with children. Perhaps your contraception failed. Perhaps you were coerced into having said child. The benefit system in that case makes no distinction.

Because it's not their fault to be disabled right? And also many say it's more expensive to means test it

It isn’t their fault, of course. Just like it is not the “fault” of some who have children. Perhaps you only found out you were pregnant too late for a termination? But the tax system doesn’t differentiate.
And as for means testing? They do it for pretty much all other benefits, why not PIP? We all submit a tax return either individually or via an employer. They already have the data.

When it comes to PIP there’s a new paper looking at options for reform just published here: ifs.org.uk

Where it is a trap is often the difference in working more days and that is the bigger problem for the economy and society as a whole.

eg you could hypothetically work 5 days for £110k per year or 4 days for £88k. If that person pays 5% pension and no student loan, they’d be on a weekly of £1349 versus £1134 so an extra £215 for that extra day. Except the 5 days versus 4 potentially involves an extra day of commuting and a day of childcare which could easily be £150 gone straight away if there is a child at nursery. In addition, that extra income means they lose the subsidised nursery hours on every other day they are working so they could actually be worse off for working more.

Like stupid local councils who see a loss in revenue from car parks, so increase car park charges again, then year later, another loss in revenue, so they increase car park charges again. Never seem to actually understand that every time they raise charges, fewer people park there, so not only less car park revenue but also slowly killing off the High Street shops due to lack of shoppers. It's what happens when people who are economically illiterate with no experience of real life get into positions of power!

People on £100k are closer to being destitute than they are to being in the league of the super rich.
As always, we are systematically encouraged to go after the wrong people.
The £100k tax trap is never likely to bother me personally, but the principle of it bothers me a lot. We are not heading in a good direction at all.

This definitely has ripple effects in the NHS. I actually would happily cover the odd shift at short notice, do a few extra clinics to catch up, take on extra leadership roles, projects or trials. However it would literally cost me more than I’d earn. I like my job and I’m dedicated but paying to work is a step too far.

I take unpaid parental leave to stay just under the threshold. Nice to have the time with the kids, but means my clinics don’t get done. And I work in a department where lots of consultants have young kids and are doing the same. Feels like a bit of an own goal from the government.