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Original poster

Can we get George Osborne on here to explain why childcare is not tax deductible?

65 replies

Strix · 08/07/2010 14:28

And by "tax deductible" I mean working parents should not have to pay any tax (income, NI, etc.) on the income which they use to pay for childcare.

Scrap the childcare vouchers which result in a pension reduction, and just work out what our taxable income is AFTER the cost of childcare is subtracted.

Childcare is after all a cost incurred for the sole purpose of going to work.

And, it would help keep people in work because it would be more affordable for lower and middle earners to actually go to work.

OP posts:

Chil1234 · 08/07/2010 16:01

Don't be melodramatic. People work and pay for childcare already. Those on lower incomes often get the cost subsidised via the tax credit system. Those on higher incomes pay for their own. Some are lucky enough to get employer-subsidised schemes. It's not a straight choice between 'tax deductible nannies' and 'life on the dole'.

Original poster

Strix · 08/07/2010 15:41

"...and presumably, if you couldn't afford it, you'd have opted for something different. "

Like what? A life on the dole?

OP posts:

Chil1234 · 08/07/2010 15:39

Because you're not a business and families don't exist to make a profit. We arguably pay for all kinds of services in order to hold down a job and no-one's seriously suggesting that we can offset car maintenance, a gardener or dry-cleaning as tax deductible.

Your choice of childcare was ultimately personal and presumably, if you couldn't afford it, you'd have opted for something different.

orangina · 08/07/2010 15:34

And if you needed a DRIVER instead of childcare, you COULD deduct it from tax....

(irritating)

(wonders about hiring driver, ESPECIALLY as I still haven't passed my driving test )

Original poster

Strix · 08/07/2010 15:27

Oh, I know it's not affordable for the government right now. The thing is, is not affordable for me either. And I earned the money.

The government taxes me as if I am a profitable business when it comes to childcare. But, if I was a business, they would allow me to subtract my costs from my profits before they worked out my tax. So, why can't I do that?

OP posts:

orangina · 08/07/2010 15:15

Good idea Chil (last words from me....)

orangina · 08/07/2010 15:14

PPH remains v good value sister...!

(must get on w work now, earn those £££s to pay the taxman...!)

orangina · 08/07/2010 15:12

PPH doesn't even do too much of that I don't think..... kind of busy these days...!

AP+ w 3 yrs experience and great refs started w us, assured me on numerous occasions when I asked that she was fine, settling in for the long term, very happy etc and then left a note after 2 weeks saying she didn't think she could be happy and sorry she didn't have the courage to say good bye. Left us in the shit big time, dh had to cancel work trip, I was up to my eyes in work and study, etc. Hideous.

So hold on to your reliable nanny strix!

Chil1234 · 08/07/2010 15:11

I don't think this one is a starter, to be honest. Using 'childcare costs' as the benchmark effectively discriminates against those with fewer children and those who are SAHPs. It also rewards those who choose expensive childcare over cheaper alternatives. If childcare costs became tax-deductible then other 'care' costs would also have to qualify or there would be accusations of discrimination against disabled people, the elderly and so forth.

I would much rather that there was a sliding scale, tax-free allowance per child that could be added onto the personal allowance of the nominated parent. Families where both parents are either not working or not paying any tax would be covered by the WFTC or CTC.

longfingernails · 08/07/2010 15:09

Oh I've just seen your happy news Strix, congrats

longfingernails · 08/07/2010 15:08

Strix Of course we should have a low tax, high growth economy. If more politicians and journalists realised that it is not "government money" but "our money" the world would be a better place.

However balancing the public finances is the priority. If you don't balance the budget you end up paying ridiculous sums in debt interest.

I don't think further spending cuts beyond what are planned are possible. So any shortfall in the public finances due to tax breaks for childcare has to come via tax rises elsewhere. And we are too highly taxed already.

Original poster

Strix · 08/07/2010 15:08

Yes, so you can give your money to the childcare of course... but not after you pay some tax!

OP posts:

VictorVictoria · 08/07/2010 15:07

That's a shame. she was such good value as a poster.

Anyhoooo

Must do a bit more work before I go home.......

Original poster

Strix · 08/07/2010 15:06

I haven't had a proper party or anything to announce it. But, I started blabbing about it a couple of weeks ago.

OP posts:

BecauseImWorthIt · 08/07/2010 15:05

Strix! Have you made an announcement that I've missed, or did you just slip it into the thread?!

Congratulations. Hope all is well!

orangina · 08/07/2010 15:05

That's it for me too, was never brave enough to go for #3! PPH is v well thanks vv, you are right on the sister front! Is never on MN though after hooha a year or so ago....

Original poster

Strix · 08/07/2010 15:04

Well... (gossip alert) I have it on good authority that PPH is a mouldie now.

OP posts:

Original poster

Strix · 08/07/2010 15:03

Thanks, Orangina.

I remember your nanny vs. au pair dilemma.

OP posts:

VictorVictoria · 08/07/2010 15:02

Spot on. I am 42 next week so that's it for me (and for my bank balance). How is PPH doing (if she isnt your sister whicbh for some vague reason I think she was) then ignore!

Original poster

Strix · 08/07/2010 15:01

I hate when people say "Where will the money come from?" It comes from my pocket. Just leave it there.

He is cutting off his nose to spite his face because the cost of childcare is keeping people out of work which of course results in them not paying any taxes at all and some collecting benefits.

Does he or doesn't he want people to go to work?

OP posts:

orangina · 08/07/2010 15:01

congratulations strix! And for what it's worth, moving to ap isn't always easy (we tried that one, had a short hideous experience, and are back on the nanny/housekeeper thing for another year.....)

orangina · 08/07/2010 14:59

Yes vv, I remember you ... didn't realise you had had another one quite recently though.... congratulations! you were seeing LR as your consultant?

Original poster

Strix · 08/07/2010 14:58

I have two in full time school and was all ready to drop to an au pair. hurah!! Oh, but wait... baby number 3 on the way. Due 25th December. Happy Christmas Strix, here is the return of your nanny bill... Bugger!

Oh well, looking forward to the cute baby, even if he does seal my fate of bankruptcy.

Tax deductible childcare would be an enormous help!

OP posts:

longfingernails · 08/07/2010 14:58

It's a good idea. I support it in priciple because it encourages people into work, but there is no money left.

How do you propose to make up the gap in the public finances? I can't be bothered to look up the figures right now but I bet the annual cost to the exchequer would be many many billions.

LadyBlaBlah · 08/07/2010 14:55

Osbourne engaging with people and answering questions about real things?

ludicrious suggestion

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