To be pissed off at the new tax free childcare

[childcarechallenge]

NC for this.

We have two DC in childcare and live in London. I'm starting a new job next month and my salary is 48K, after tax, student loan, childcare costs and tube to work plus a few other generally working expenses (clothes etc) I've worked out that I will take home less than £200 a month.

DH earns a good salary which is good because we almost completely rely on his salary for rent, bills etc. He just received a large bonus which pushes him over 100K which is the new limit for the new tax free childcare scheme from the government.

Essentially, between 100K and 120K after tax, student loan, the loss of his "tax free allowance" which is clawed back over 100K, and the fact that we will not be able to claim £4000 back on our childcare because he is no longer under 100K (This applies to BOTH of us because of his salary) means that of that £20K we are actually only £1800 better off. AIBU to think that this is complete robbery - DH works extremely hard, very long hours (sometimes 70 hour weeks) in a high stress environment and the government seem to take an obscene amount of his salary.

We have an opportunity coming up to move to a lower tax country in a year or so with his job and this just makes me really want to take it, AIBU?

I dont get why the OP got such a hard time.

For anyone who claims benefits, IS, CB, HB, UC, where do you think that money comes from to pay the benefits?

They pay alot in and get next to nothing out. If all the high earners disappeared and everyone earned low wages well there'd be no more benefits.

The OP gets a hard time because there are posters who don't think that almost 100% tax + costs of working rates are unreasonable.

They pay alot in and get next to nothing out

Of course they don't get 'next to nothing' out.

People's ideas of 'nothing' seem to be a bit schewed tbh.

For anyone who claims benefits, IS, CB, HB, UC, where do you think that money comes from to pay the benefits?

You do realise also that Peper that receive those also work and shock horror pay taxes.

*people

Good grief it's so expensive to be so well off, I'm glad we're min wage.
The thing is OP, you have chosen this lifestyle, you could be a sahm and be better off.
You could live in a cheaper area, choose a job that costs less to work.
There are lots of choices, you have chosen the most expensive for you and your family.

The only realistic alternative choice the OP has is to be a SAHM. The tax regime is certainly encouraging her in that direction.

TBH it's a massive feminist issue when the costs of working for second earners eat up almost 100% of income.

(although once you reach a certain income increases aren't eaten up by anything except 47% tax/NI so you still keep half of what you earn. My 18 year olds don't need much childcare now)

Dixie that's hardly comparable! There's a big difference between being on a lower wage and being so low you need TC / HB etc.

You're absolutely right Niki

Why are people so bitter that others chose to work hard and to earn that good salary? Good grief it's not like the OP and her DP are sat on their arse claiming benefits and claiming they shouldn't lose their benefits for actually getting off their arses and doing a few hours work!

I'm not sure you understand what people's criticisms were about.

BeBeatrix I absolutely agree with this:

Taxes are necessary in a compassionate, civilized country, and it's right for those with more to pay more.

But... higher earners already would pay more even if tax remained at 20%! If somebody earns 50k at 20% tax they'd pay £7.8 k whereas somebody on 20 k would pay £1.8k. That's a huge difference already without then adding more tax on top! How people can't see that is clearly beyond me.

My entire yearly income is less than that 20k bonus!

The reason for having tax rates that increase with salaries is that 1£ is worth a lot more to someone who earns 15k than someone who earns 100k.

It's right to increase tax but there is a level at which taxation is too high and people choose to avoid tax (legally or illegally) or move away from the country - leading to less overall tax collected.

There is an argument to be made explaining this away to people "delaying" (only time will tell) but when then government reduced the top rate of tax from 50p to 45p, tax receipts increased.

Why are people so bitter that others chose to work hard and to earn that good salary

Why do people keep peddling this.

How hard you work is not is not necessarily reflected in the amount you get paid. Or are you saying carers on £67 quid a month are lazy layabouts?

Yes and the less well off would often ilke the rich to lose more money even if they the less well off have less money as a result so you are never going to get most people who don't earn much to have much sympathy for higher earners. It is just how it is.

The issue of why I earned 10x my other half's full time wage and why most other women don't is always fascinating. Now 70% of students are women and women under 30 earn more than men you would think would would marry lower earner mens who might make good house husbands but they don't. They still want to marry the slightly older slightly brighter, slightly higher earner man who will out earn them adn it's one of the biggest reasons women never go on to have much power or money in the UK much more so than because of discrimination at work. They have babies with these alpha male higher earners and even their £48k wage is peanuts compared to his so when it comes to whose career comes second time and again women come second and it's because they are marrying higher earner men rather than say the attractive male nurse or teacher whose wage is half theirs.

Hahaha DH would love to hear that he is described as an alpha male 😂

When we got married I slightly out earned DH by 3-4K. But two years of mat leave and in between babies working part time... it takes its toll on your career definitely.

If we didn't have any children I probably wouldn't be earning as much as he is now because of the industries we work in, but I would expect to be on around 70.

EnormousTiger - great if you make it out to the other side, so to speak. But since we know that, statistically, fewer women than men become very high earners and there are constant "initiatives" to encourage more women into senior roles, surely removing fiscal disincentives ought to be a top priority?

This is also a major issue in the French tax system, with the same constant plea for more senior women. If you want women to work hard at difficult jobs, it would seem frigging obvious that you shouldn't grab most of their earnings (and more of their earnings than those of comparable men). Pfff. Crazy system!

How you can claim to be intelligent but not be aware of the threshold and basic planning to avoid it is beyond me.

Bit like not anticipating and saving in advance for the temporarily high costs of nursery if you have two children close together.

It's called budgeting OP.

Certainly true in my car tiger. I once heard a pretty successful female academic express that she was looking for someone in the same field who was slightly more successful than her! That would be a tiny selection - she was willing to consider divorced men but not anyone earning less or less successful! She was earning a huge amount and struck me as being ridiculous at the time.

I too am surprised OP and DH didn't take steps to plan for and get around this.

childcare it is a reversible discrepancy though, if you do more training etc you will be able to gear up your career again. Mine is on a low boil but even at nearly 40 I know I can go for more ambitious roles when the kids are older.

Batteriesallgone - it is not the OP who is in the wrong - it's the system that is profoundly immoral. Don't defend the system and berate the OP for not complying.