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?

Did you read my post? Employer covers school fees, housing.

Did you read my post?

Those jobs aren't in abundance like they used to be.

I know a few people who have come back recently.

Okay, fair enough six, I also know people coming back from the middle east.

Sorry, Piglet*

Agree with the tax system comments

Friends of mine are going abroad for a few years, they will save all the money that they would have paid in tax and it should help them when they move back to the country

It isn't just the ME they are coming back from.

The thing is though OP it's only a temporary situation...Childcare and student loan won't last more than a few years. And you can't resent the SL as it must have played it's part in enabling your DH to earn the money most people only dream about.

897 what the hell you spending your money on if you have less disposable income than someone on tax credits? Because if it's a hefty mortgage that doesn't count because at the end of it you'll have an asset presumably worth more than any house your sister has. While your sister may have a higher disposable income I'm willing to bet you have more for the future whether that be pensions or more equity or whatever. Because tax credits sure as hell aren't paying out the equivalent of 100k salaries.

I'm sure in the long run you'll be better off....Otherwise you best tell your DH to quit his job so you can join your sister on tax credits.

To be honest then it sounds like you both should consider going for his own career development if he might get the chance to work on big projects and get more credit at work, and you sound like you'd rather not put your children into full time care. Then you could return when the children are school age and take a job then.

In this case they wouldn't hire for his role in the UK because he would be still doing it - so the UK would lose tax money. But I take the point that in a lot of cases people leave roles that are still done here.

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?

See ya!

My DH is the same- very much london based. If we move he will be giving up his career and taking whatever job he can get but for the good of the family that's probably what will happen. We would love another child but will be spacing it until DD starts school. I'd also have loved to take more time off, have 2 kids and stay at home until they are in school, but that would be practically impossible in my profession.

As I said we are lucky, and I really recognise that. London is incredibly expensive though.

in one year? I'd see if he can move up the timeline a bit and not go back to work personally whilst you sort out the move. The downsides of living away are: loss of contact with extended family (one of the reasons we eventually moved back), loss of your network of mum friends - not sure how much of a factor this is but you'll need to join a lot of groups to make new friends and that can take time.

Yeah it could probably happen sooner tbh. I know these things take forever to sort out though. The extended family is painful as we see MIL every 3 weeks on average and the DC love her.

100k plus level (i.e. the sector which already pays the majority of all income tax)

I think that is delusional comment. Please check your facts because they are truly wrong!
Yes they pay tax but not the majority of it!

www.theguardian.com/news/datablog/2014/jan/27/how-many-pay-top-rate-of-income-tax-uk
www.independent.co.uk/news/uk/politics/the-graph-that-shows-how-the-poor-are-paying-more-than-the-rich-in-tax-10353982.html

Are you fucking serious?!!! Poor you eh with your massive salaries

I'll play you a tune on the worlds smallest violin.

OP you won't get much sympathy here but I do understand what you are saying about the system being unfair. People are penalised for earning more- it is a fact. In my option everyone should be treated fairly and that means everyone should be entitled to a tax free allowance as proportionally extra tax is paid anyway and you are penalising people for earning over a certain amount twice.
In addition the new childcare scheme is inherently unfair as two households earning just under £200k will be eligible whilst one household earner with 100k won't be. Whether those people should be entitled to anything is a separate argument and has nothing to do with whether the system is fair which it is not.
So I think people on those salaries should complain? No of course not. But I do think that the system should be fair.
One thing I would ask you is how much your rent is and for what size property as I do think people don't realise just how expensive London is. The cost of living is higher than elsewhere in many ways, including childcare also.
But you have to stop and count your blessings because there are people barely getting by so you need to get things into perspective. You do have an income that most could only dream of so please do think about that. Childcare costs aren't forever and you need to think of the longer term picture.

antimatter

www.telegraph.co.uk/news/2016/04/26/nearly-half-of-britons-pay-no-income-tax-as-burden-on-rich-incre/

"The Institute for Fiscal Studies said that the proportion of working-age adults who do not pay income tax has risen from 34.3 per cent to 43.8 per cent, equivalent to 23million people. "

"Over the same period the amount of income tax paid by the richest 1 per cent has risen from 24.4 per cent to 27.5 per cent, meaning that 300,000 people pay more than a quarter of the nation's income tax."

Top 1% of earners earn 150K+ (individual)

Hmmm sounds like you have had children you cannot afford?

We pay just over 2K a month for a good sized 2 bed garden flat in zone 3, less than 15 min walking distance to two tube lines (which we need because of our job locations and location of nursery).

It's big enough for us but it is a little bit of a squeeze with two DC.

Why not get an au pair? Surely they wouldn't cost £29k a year and you'd not have to do the nursery run.

I'm not the OP but my rent on a 2 bed cottage with garden in Zone 3 is £2200/month, and childcare for 1 child under 3 is £1800/month. Childcare more expensive as there are very limited options for those of us needing care pre 8am or post 6pm (not every day but sometimes we need the longer days). I also work on call shifts and DH works away sometimes so we need extra care at those times (again not often but to have the option we need to pay people!).

Well we moved cities and got an allowance to help us with expenses. This was taxed at 50% which I thought was really unfair but ultimately yabu to moan about it.

is your MIL in a position to travel out to you on a fairly frequent basis or would that be un-affordable? That's an aspect that needs thinking about then. One more thing occurs: if your OH's work want him to move anyway for these big projects, it'll possibly be tricky and consequential for him to turn that down, so why would you personally flog yourself in a job that isn't paying much for 1-2 years and then have to quit to move anyway? It's not like you're going to accrue unbeatable experience in 1-2 years with 2 small DC in FT childcare and all the sickness etc that means.

Well put Happyfeet1972

In addition the new childcare scheme is inherently unfair as two households earning just under £200k will be eligible whilst one household earner with 100k won't be. Whether those people should be entitled to anything is a separate argument and has nothing to do with whether the system is fair which it is not.

I actually feel there is a bigger issue here.

1 earner / 1 SAHP = fine. They don't need the child care.

1 high earning / 1 lower earning = NOT FINE as this add pressure for the low earner to give up work.

It is often women who have set their sights lower and are in lower paid work than their husbands. They are gewnerally working PT or more flexibly. Annoying but it does seem that the majority of women haven;t shake off the 1950s and want to stay home whilst their DHs earn the money.

Anyway, now if you have a woman working PT earning £18k and a man earning £110k - they would probably be better off if the woman gave up work.

This is further going to disincentive women keeping their careers/pension up.