Tax should not be paid for working over time

[Dssen]

Me and ds were chatting the other day . He's done some over time but he said sometimes it feels pointless because the tax man takes quite a bit of it . We were thinking that if someone works over time that person should not be taxed. It should be a kind of reward that if you work overtime it's tax free .

Not going to happen but wishful thinking.

Why?

My colleagues who go to the office don't work any harder than I do.

In fact they cost my employer more money than me as the employer has to fund desk space for them.

If you want to wfh apply for a job with an employer who offers it. There's nothing special about you being in an office than means you deserve more money.

It’s the ‘let’s tax everyone who’s working pattern is different to mine’ thread.

I work part time which means my overtime is at a flat rate until I work more than a FT person when it moves up to 1.5x - it makes sense but I just don't do paid overtime as I still have the additional costs (childcare, travel, food) the extra pay is meant to cover that FT staff have.
It's just taxed and non pensionable as a PO said - nothing in it for me really.
I can take TOIL which I opt for instead but doesn't help my team when the whole reason for overtime is that we have too much work on.

Plus is it actually taxed or is he now paying national insurance? That is calculated differently to tax. Otherwise he might find he gets a rebate when he goes back down to usual hours.

I do think there should be some sort of tax relief for our front line emergency/hospital workers to do OT - it might help the NHS a and e or ambulance services.

I was actually thinking on my commute today that public travel should be tax deductible for those in the lowest tax bands - that would encourage more back into the office and maybe even be a nudge for people in cities (I am in London) to give up their car.

It should also be noted that an overtime culture isn't healthy. Occasional overtime, fine, but it shouldn't be part of the normal working week - it's a cheapskate move from employers to avoid recruiting the staff they actually need.

Yes

Agree!

Where I am overtime is taxed at a higher rate to discourage it. The thinking is that it will ultimately lead to burnout so people take time off in lieu instead.

In my company you have to confirm in writing that you have childcare arrangements with a paid provider/family member in place if you have children under 10.

They can ask you to submit proof like the contract or an informal "notice" with grandparents. And yes, that's expected from men and women unless you can prove your wife/husband is a SAHP/works outside your working hours.

I'm not sure that 'thinking' played much part in this discussion at all, tbh.

Overtime income is no different to any other income, and the idea that it should be taxed differently is just ludicrous. There is no such thing as a "fair contribution" threshold, above which you get to opt out of being taxed.

• Person A & B work the same job for the same pay.
• Person A works 30 contracted hrs and 10hrs overtime.
• Person B works 40 contracted hrs, no overtime.

What possible justification is there for Person B paying more tax than Person A?

Just out of interest, which country is this?

It certainly is.

It could also incentivise people in those roles to work unsafe numbers of hours without enough time for sleep. I don't want to be treated by a clinician working unsustainable hours.

Not only that, but the more hours you work, the more likely you are to burnout and go off sick, which would be counter productive if you are looking to address staff shortages. The unintended consequences could be very detrimental to the service.

(And yes, I know it happens anyway, but I don't think the state should incentivise it. Instead we need to focus on paying existing staff enough to retain and motivate them, and training more skilled staff for the long term.)

@TarantinoIsAMisogynist BeNeLux area. I think Germany are similar.

People turn positive for public finances once they earn about £40-50k (depends on various things) so it would have to be beyond that point. Of course if everyone were allowed to earn tax free after that point public finances would collapse completely as you would have no net contributors at all.

People used to love overtime. It got them out of sticky financial circumstances.
However the advent of tax credits meant that overtime was not attractive. Why work for the extra money if the govt paid it you for nothing.

The tax situation is not always helpful.

Personal tax allowance should be National minimum wage x (37.5 hours [1])
Parents could have a tax allowance additionally for every child (£5000? or the equivalent of NMWx10hours?)
Parents living together could share or split the allowance for children.
A level of tax allowance for children at uni could exist too.

All done at tax code and no complicated nasty forms.

[1] or 38, 39...