AIBU to claim child benefit?

[tooposhtopost]

This morning, I heard a minister being interviewed (didn't catch who) saying that he hoped that 40% tax payers would "do the right thing" and stop claiming child benefit.

The top earners already pay 50% tax, get no tax relief on our pension contributions and often do not overburden the state (eg private education for the DC, private healthcare).

I have always claimed CB - well, it arrives by direct debit. I have seen it as a tiny weeny small rebate of tax in recognition of the fact that we have the extra cost of having children who will be the ones supporting all of us when we get old. So should I be disclaiming it?

Who else would like to know if any government ministers (or their wives) claim CB or whether they are leading by example and eschewing it?

You are tight Ornamental Cabbage - someone would fill my job but the nursery would need to lose staff if all the working mothers found it too expensive to work (as some already do!)

By returning to work, I have sacrificed time with my children with the aim of being able to provide for them better. Being a working Mum is hard - finding enough time in the day is virually impossible.

Now it seems that all the hard work I have put in to get where I am today and the sacrifices I have made mean nothing because we get penalised for trying to better ourselves.

I agree some people don't need CB but we do while the kids are young to afford childcare.

It seems pointless to want to better yourself in this country as you always get hit hardest.

Meant right not tight!

Why don't they just reduce tax for lower earners, increase tax for higher earners, scrap confusing tax credits, and keep universal child benefit (higher earners are paying more tax anyway) to simplify the whole system. Although it's perhaps unfair that people on huge salaries (not me, sadly!) get CB, they are taxed more, and it's easier to just give it than to do means testing. Save all the hassle.

I work from home ornamental, and ds is at school so i don't have childcare costs, thank god.

But if i was in that situation, the nursery workers would also lose work, less demand.

I pay tax on the healthcare, as well as 40% tax rate on income. I have never received any government money other thatn cb. I am happy to do without, but i don't think it's fair at all to implement it the way they are

Saying that, the bloody labour party, the party of tax credits for all, got us in to this mess, so I am more than happy that someone is trying to clear the deficit.

Cretaceous for Prime Minister

That would be the straightforward way of doing things. Alas.

olderandwider You that are right that I only caught a fraction of the interview but it did include the part where the Chancellor said that he hoped higher rate taxpayers would stop claiming CB anyway. This is the statement that stunned me but perhaps I heard it out of context.

I now gather (still can't get bbciplayer to work properly on your link so not certain) that what he meant was that if you carried on claiming CB as a HRT then it will be clawed back in your end of year tax return and so it will be "sensible" not to claim in in the first place. At least that makes more sense. Leaving it to individual discretion would be madness.

Because, Cretaceous, the high earners will leave if tax goes up any more - and the Treasury will be significantly worse off as a result. Several people I know went abroad when the 50% came in. Any more tax and many more high earners would join them.

"Admittedly the family with 2 earners have to pay childcare (we do) but it still doesnt even out. How bizarre."

So will the LP families

cretaceous I agree - that is what I think too. Of course the only downside is a potential brain drain but the reality is that most people don't want to up sticks and move just because they are paying more tax at a time of austerity.

I would happily pay more tax, if everyone else in my income bracket did too, and if the money is then wisely spent.

owlicecream The very top earners may, but the 40% won't, for the reasons tooposhtopost says.

Schulte
More benefits do not encourage a wider society to have more children - look at France and Germany where the birthrate is still quite low.
The pensions crisis is looming and yes we all need to have children to address this but families are getting smaller and unless the benefit amounts get a whole lot better then I dont see how we encourage big families (apart from the odd Daily Mail expose of the family with 10 kids pulling about 100k a year)

I think better funded childcare options is the way forward, if i thought i could afford to send a 3rd child to nursery and still work then I would have a 3rd child

tooposh - it most certainly isn't voluntary! I think HMRC want to avoid the hassle of changing tax codes to claw back CB payments from higher earners. So the suggestion is to stop claiming them once the law changes (but definitely not before!)

The only reason I am miffed is because we will loose ours as DH's income is just over the threshold, but If we both were just under it - so effectively just about double our income we would keep it - doesn't really seem fair that a family earning £44K a year loose theirs but a family where both parents work and earn £80K between them keep it. It should be means tested and every household above the 43K threshold should lose it

MamaOTT
I am aware of this but I wasnt referring to LP, unless you are very very high earning LP's end up getting the short end of the stick every time.

How about deducting the childcare I pay and then consider whether I should lose CB. We pay over £14,000 a year of NET earnings in childcare. Taking that out of the equation would certainly put me in the normal tax bracket!!

Marking my place as I have to go out. This is interesting.

Even in the US, land of personal responsibility par excellence, childcare is tax deductible, isn't it?

Tax deductible childcare would make the biggest difference as an incentive and enabler of work. It would also not be an expensive option as the childcare workers will still themselves pay tax on their earnings so the govt still gets its money and keeps people in employment.

I also object to paying childcare out of taxed income: My DH earns £100 and pays £50 tax, so is left with £50. If he then uses this to pay £50 to the Nanny, then she pays another £10 of tax, plus he and she have to pay between them NI of another £7. So out of earnings of £100, over £67 is snaffled by the government. Seems a lot when other less necessary expenses of working are tax deductible.

Earning around the £40k mark is not a huge amount of money to support a family on. No way would I give up my CB if I was on that. There is a massive salary range within the higher rate tax bracket and for the government to group them as the same is a laugh. I think someboby earning £40k has quite a different lifestyle to one on £150K

When will the government realise that those on reasonably well paid jobs can't keep on giving away their earnings to subsidise those earning less than themselves. CB is the one "tax relief" that those earning a reasonable salary get. Long may it continue.

I think there will be some unfairness in the new proposal, but it is hard to make the system completely fair without introducing lots of complicated means testing. Even then it is arguable whether fairness is achieved through means testing, as it can seem as though hard work and bettering yourself is being penalized.

Yes it is a shame when people trying to better themselves are hit with more taxes, but the proposed cuts to get the deficit down will affect basic rate taxpayers and non taxpayers as well.

Last comment before I try and drag muyself off here and do some housework while DS3 naps

I would be quite happy to lose my child benefit if I were earning 40k

some unfairness,

I'd say it was bloody unfair that a couple earning a total of 80k between then would keep it while a LP or single income household would lose it

Yes ok there's the childcare to think of (for the couple on 80k) but surely that wouldn't take up all of the 2nd income????

"Even in the US, land of personal responsibility par excellence, childcare is tax deductible, isn't it?"

Yes, but to look at things in the round, statutory maternity leave is about six weeks.

True, comtessa. Plus really crappy vacation allowance and sick leave.

MaMoTT - yes it can do. See me, or Poogles. And that's a bloody disgrace. I think pretty much everyone on here agrees that more of the childcare fees should be tax deductible. £243 is a laugh, especially as you can only claim it once no matter how many children you have.

Whitethorn - okay but turn your argument around and making it harder for families won't encourage them to have more children either. In Germany the main problem is not that the government doesn't offer financial support, but that there are so few daycare places available for very young children. But benefits and tax credits aside, it's also very much a cultural thing. And interestingly, looking at my middle class friends in both the UK and Germany, on average we all have the same number of children - in fact I have more German friends with 3 children than English friends with 3.