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?

Tbh its nt dissimilar to what is going with the £40.000 cut off for CB.

You can have two people earning £35.000 and they will get CB but one person getting over £40.000 and their partner not working or earning little means they don't.

There is a need to start talking about shared income rather than individual income. They can do that if you are asking for some benefits so why not in those cases? apart from the fact that the government would probably be loosing some money

Sell your gold plated unicorn and you'll be fine.

I agree with you op. The whole reason the govt. can get away with the ultra heavy taxation of those on £100-£120k is because they can rest assured that if those "rich" people complain then there will be millions of hysterical people (who only read the headline £100k) ready to lynch the complainers. Without any consideration of the detailed facts. A poster above had an accountant prove that two lower rate tax payers with CB etc were financially better off than one earning 100k.

The OP is in a rented 2 bed basement flat with a family of 4 in zone 3. Her kids are in full time nursery at a cost of £29k. I do not call that a good quality of life and in her position, moving abroad seems extremely attractive.

I'm not one of the people who earns this kind of money but it seems idiotic for the govt. to drive them out of the country.

Antimatter it wasn't me that said higher earners pay the majority of tax. But thanks for your well wishing anyway, you too :)

YippieKayak Yes I am aware of what most people my age are doing, and i know they have very different incomes but they also have very different outgoings. Sorry, I didn't mean to be insulting, but if it is causing lots of people to move away then maybe there is an oversight in policy design - I didnt say it is, just questioned it. Our first DC wasn't exactly on purpose (like most people our age I guess) but DH stepped up to make the finances work.

Thanks fakenews thats a really good point, I think HK is a pretty good place to be an expat too.

A poster didn't say that. They said the lower tax payers had more disposable income. We don't know what the rest of the income was spent on. The higher tax family could have had a far larger mortgage, council tax etc.

Without the breakdown of the figures, we cannot know.

i don't call it a good quality of life either, certainly not for the DC most particularly. The hours the DH works, op is going to be doing all the getting ready of 2 small DC, all the pick ups, and working full time. I know it can be done, and lots of people are forced to by circumstance, but I don't think that's enviable or desirable.

Frankly if I was in your position I'd get out of London. Utter madness to pay 2K a month for a flat. Not to mention all the other London-inflated costs of childcare, travel etc. Seriously you might well both be better off taking lower-paid jobs outside the capital

Agree completely.

So many people have seemingly massive salaries, but then pay a lot of tax, pay a lot more for housing, childcare and travel, and are not entitled to Child Benefit, as well as being in a job where they are expected to work 70 hours a week. Surely many of them would have a much better quality of life, and may have more disposable income, in a different city where housing costs are substantially lower?

Even if they earnt a much lower salary, such as about £40-50k for example.

It does seem unfair to be paying that amount of tax. The pressure and accountability in jobs that earn in that region are very high stress. It does seem to make sense to take a lower paid job, less stress and you can switch off from work. When childcare is factored in what you are left with isn't great.

You can't be that well off if you're renting, can't really afford childcare and squeezing 4 people into a 2 bed flat that you're complaining about. Which is it? Are you rolling in it (should be on that income), or struggling because you're in London?
DH earns about half of your household income, we feel happily flush with money, we are also 'very young' (that term is ridiculous as it's a matter of opinion). We managed to buy a 2 bed flat in London, sold it, now live in Surrey, Dh works in east London. Works well for us. He paid off his student loan already. We only have one kid (he goes to nursery a few sessions) and I'm a SAHM.
Sounds like you need a budget!

Sympathies OP - we are in a similar bracket, but with four children. I gave up work to be a SAHM because I couldn't make the sums work - and after paying for a full time nanny and commuting costs from Kent, made about £250 a month, even on a £80k salary. I would have been well into a six figure salary if I'd stayed in my profession, but as DH leaves at 7am and is home after 8 every night, and travels extensively, I didn't see how I could balance the children and the house and a job.....so I quit. I wouldn't want to move to Asia, but we did move out of London to try and reduce costs - and not have the education costs - but it's still not 'gold plated unicorns' and 'private jets' as some seem to think....

I do think that the tax system needs looking at in that odd window of £100-£120k, precisely to stop people leaving the country because they don't see an alternative. And because it isn't 'fair' that if you have two people earning £50k you are significantly better off than one person earning £100k.

I think moving probably is the right choice for you. Even with a govt to the right of centre the reasonably settled position in the UK is that the tax burden is greatest on those withth very highest earnings. On whatever measure you use, your DH is one of them. So finding a country with a taxation system which more closely aligns to your views is sensible.
There will always be foibles and unintended consequences, but not every family can be considered on their merits as the admin burden would be huge and disproportionate.

i know they have very different incomes but they also have very different outgoings.

Yes, and I imagine that you are no better off at the moment than someone of your age earning much less. But my point was that you and your DH potentially have fifty years of high salaries ahead of you, and a few years of short-term pain in the meantime. I appreciate that your first DC may have been unplanned, but you chose to have a second with a small gap. Many families simply can't afford a sibling gap of less than four years.

Incidentally, have you costed up a nanny share? It would almost certainly be cheaper than two in full-time nursery.

£29K for childcare?
Could you get an au pair?
Surely that would be better for you?

hellsbells addressed upthread - OP is in a two-bed flat with two DC and can't accommodate an au pair.

Of course you're finding it easier bendy, your circumstances are completely different to the ops.

OP, will you be able to get a job for the same pay with a short commute if you move abroad?

It does seem to make sense to take a lower paid job, less stress and you can switch off from work

Ask a carer on £67 a week if they have 'less stress' and can switch off.

i also think the bigger question is, can your DH really turn the move down? it doesn't sound like he wants to. Otherwise it's a question of when and not whether this happens. Personally, if I'm going to pay a career price, I'd want a benefit in terms of time with my DC. I'm wondering why you got the new job when this move was looking like it'd happen in a reasonably short time frame?

YY Piglet. What's not being factored in is the huge stress of struggling just to keep a roof over your head and feed everyone, as well as the high pressures of other people's jobs that the OP and people backing her know precisely fuck all about.

Go. Take a few years out but do some sort of online certificate thing to keep yourself relevant. Volunteer. Whatever. Enjoy your tiny kids and explore a new culture. With the xtra cash fly MIL to you. Brexit is going to cause a financial mess for years. Jump now. You can always come home.

I do agree with the poster that looking at a couples income for benefits purposes but taxing individually causes stress and pressure particularly for women to give up work.
I can't compete with my DHs income so It is financially sensible for me to do the childcare, which further reduces my ability to compete at work. In reality you look at joint income and maximise that.

Surely the point is that the DH, being in a position of great privilege, is not going to end up as a carer on £67 a week. Getting a lower paid job for him means taking a job on about £50k, which might be a fairly stress free role and outside of London, reducing their huge living costs.

This has got to be a wind up

Surely the point is that the DH, being in a position of great privilege, is not going to end up as a carer on £67 a week.

The point the person was making was that high paid job equals lots of stress and can't switch off after work bit low paid job equals no stress and can switch off.

It isn't true.