To think pensioners paying NI is a step towards equality

[jnfrrss]

Apparently it would raise 2 billion a year and help cover social care.

Mail comments are furious people, but isn't it a step towards a more equal society and taxing everyone more similar regardless of age?

Ni just seems like such an outdated system and in an ideal world it would all be rolled into one tax with income.

Most children banyan? Not those of us who were feckless enough to be born into families without much to leave! And you don't take into account care costs either.

But really, the reason why younger people feel hard done by over inheritances is because for so many, it's the only hope they have of being able to purchase a home. If people who are young now had the same ability to buy a home as was the case perhaps 30 or 40 years ago, without the need for inheritances, the issue would be much less important. There's a reason home ownership is now so much lower amongst the young.

And please, nobody regale me with anecdotes about younger people buying homes. I know millennials can do it without inheriting, I have. But the stats don't lie.

Numbers wise, surely most people don't inherit anything? It will be a minority who do?

As it stands anyone earning up to £892 per week pay 12% of their salary anyone earning over only pay 2% NI contributions

They pay 2% on the bit above the £892, they still pay 12% on the bit below that, and they also pay a minimum of 18% more tax once they reach the higher tax threshold too.

Surely any pensioner working past state retirement age is doing so out of need than desire? I don't know many 67 or 68 year olds who want to work but I know a few who are working past state pension age because they have to either due to patchy pension savings or they still have a mortgage or debt to service. The state pension is not a huge amount so topping up this with earnings is the only way some people can make ends meet. It seems unfair to penalise them by charging them additional tax which is what NI is when they are already contributing and have contributed all their lives. It is all very well to say it would make things more equal but a 20 year old who has not yet worked at all is not equal to a 68 year old who may have worked 46 years and paid tax and NI all that time. Why is that fair?

In the interests of full disclosure my DH and myself took early retirement at 58 having saved in a personal pension from our early 20s. We don't pay Ni as it is not paid on pensions but do pay tax.

RebeccaWrongdaily

If all the details you quoted are correct either one or both of your parents must have been in highly paid jobs and are not the norm. My public sector pension is around £5k per annum on an average part time job.

Cornish, sorry if this a stupid question but do you mean you pay tax on your private pension income?

I am getting my pension when I am 66 (not far off now). However, I live alone in the London area and it is quite plain to me that even if I can just about manage to live on the rather small pension I am likely to get and I am doubtful about this (I will only get a state pension - no private pension), I will not be able to have any luxuries/holidays/occasional visits to theatre/meals out, etc and may well not be able to afford the upkeep of my 2 pets. Thus, I realise I have to keep on working as long as anyone will employ me although I may, hopefully, be able to work a little less weeks per year than currently. In my generation I am aware there are lots of people like me. I am not whingeing about this - it is just how it is. No, not all pensioners are rich and not all want to go on working after pension age - many of us will not have a choice.

WomaninGreen, all pensions are subject to tax, including the state pension. However the state pension is paid free of tax as it is lower than the tax allowance.

So yes, Cornish will be paying tax on any private or occupational pensions.

Thanks
Good to know it's only after the allowance rate though.

I think it would encourage more people to go into investing in a 'buy-to-let', which are, in some areas, causing the housing issues.

Also, I can't help feeling that many WC pensioners, from Up North, will be getting fucked over twice (or more).

Moving all of the secure jobs into one area of the Country was never going to work, as wasn't the 'get on your bike' answer. One half of the country has a Housing issue and the other an Employment issue. how did that make sense?

When my Mum was forced to retire, she became a Lolly Pop Person, or School Crossing Patrol, as they are now known. She did that because she had worked since she was fourteen and that was her life and my Dad had been fucked over by Thatcher for his pension (Merchant Navy), but, like many Men of his generation didn't live much passed 60, which left my mum to manage on her own.

At the moment, where I live, most older people are now helping the younger one's in the family out. with babysitting, housing and even just by cooking over the weekend and the family eat at Nan's.

This would just plunge large numbers of people into further poverty. These policies do nothing for the 'ordinary hard working person', they just take-take-take.

We are speaking about Pensioners as though they are separate to the rest of Society's ills. But to most lower working class/earners, the Whole Family is intertwined.

It's just been one long list of targets, coming under the guise of 'making society more equal', when in truth it's equally dropping many people who were just managing, into the shit.

""I am getting my pension when I am 66. I will not be able to have any luxuries/holidays/occasional visits to theatre/meals out, etc and may well not be able to afford the upkeep of my 2 pets.""

And there's the difference, working past 75 to afford the heating, essential home maintenance, or to help pay for your grandchildren to do a hobby, is a bit different.

I'm in no way getting at you, mrsjoyfulprizeforraffiawork.

Buy to let has become much less advantageous for taxation purposes than it used to be, so people may be less inclined to turn to it.

Also, it might discourage pensioners from taking jobs that younger people can't take, because of low wages, such as the School Crossing Patrol. It kept my mum fit and engaged with the community. She did it until she was 80.

Working does have other benefits than earning a wage. we don't want to do with pensioners, what we have with other groups of low earners and not make work, pay.

Many older people are also caring for elderly relatives. Increasing the state pension age is already causing difficulties for some who care for elderly relatives.
My friend works part time and cares for her elderly mother. Without her care, it would cost the state far more to care for her mother.

CuntinuousMingeprovement, but for lower earners, who have got a small amount, say £6k to invest, they are still attractive. I'm speaking about Up North, were I am. We never had a housing crisis, but we have now, because of the conditions of no DSS put on mortgaged Buy-to-lets and the Bedroom Tax.

I've always said on some issues we need regional policies not national policies.

Interesting thread. So many people with no idea of the realities of state and private pensions and post retirement working. Yet many happy to say categorically, yes. Older people should pay all sorts of additional taxes, presumably in the hope that it will all be 'fixed' by the time they retire and it can all be taken off again

Yes, you pay income tax on private pensions. Yes you pay income tax on earnings. No, you don't expect to have to pay more NI when, like me, you will have paid in 50 full years before you retire! That is the reality for many coming up to retirement. Many of us lived through 2 crashes, some lost houses in the late 80s as interest rates hit 18%, we certainly got scared off getting a mortgage for years; we got the option to have personal pension plans later in life; had our retirement age moved twice and STILL some people want to set generation against generation as though we are, or will be, living in clover!

Heads out of backsides folks. We are being divided and conquered by people with ulterior motives and/or something to hide.

Focus on those that HAVE and those that do NOT HAVE. I seem to be saying this a lot at the moment "From each according to their ability, to each according to their needs"

You really don't have to allow yourself to be brainwashed into thinking the problems have an age divide!

Also younger people are on track to get a better state pension than many older people.

I think this is a very difficult thing, not just around NI. I can see if I was older and promised things earlier in life I'd be annoyed when I didn't get them (such as issue with certain women's pensions), but I can also see that working aged people are going to struggle to pay the increasing costs of people living longer. I do think there is a balance that needs to be made somewhere, though I'm not sure how! I'm 32 and tbh I'm not banking on even being able to retire. Time will tell I suppose..

Interesting thread. As a twenty something I am already thinking about my pension (one of the lucky few who has a decent workplace pension at the moment - I work in banking) I don’t believe there will be a state pension when I retire so I am making my own provisions. I believe I am paying NI to pay for older people now and I won’t benefit from it later on. Is the system working currently? I seriously don’t think so

Retro I have paid into a private pension since I was 22. Unless you are well paid, a private pension is rarely enough to replace a state pension. That is why they were sold to us as top ups to the state pension.

But, Nicholette, you will get paid maternity leave and free childcare. We didn't get those things. When my son was born you didn't get child benefit for the first child. We could get bent out of shape about that but, on the whole, we don't.

I understand why I pay tax on my private pensions, it's fair and just. But I really don't think that, after paying NI for 46 years to entitle me to a pension, I should have to go on paying it, should I choose to work. Which I don't - I'm very grateful to be able to retire.

I live in the north too birds. Buy to let has become less attractive because wherever the BTL property is, owners will now have the full amount of rent counted as part of their income from income tax, not the rent less the mortgage payment as was the case until about a year ago.

It's also pretty difficult to get a BTL mortgage without at least a 20% deposit, and even in the north west where I am, there are not a great many houses where 6k is that- or less than 6k really, given that you'd have solicitors fees etc as well. Lastly, BTL is a bad idea to get into if you don't have the cash buffer to pay for a few months of no rent while you evict a tenant and also to do it up between tenancies. This is very unlikely for the cohort you mention. It's bad idea.

Also younger people are on track to get a better state pension than many older people.

This is what we're being told, but it coming to fruition is another thing altogether. Many of us find this entirely implausible, unless we don't retire until we're 80. We also doubt we'll have access to pension credit like today's pensioners.

Yes there was no help at all with childcare, and paid maternity leave was very short. I am glad younger mothers have those benefits now and don't have to go back to work when their baby is 3 months old, or alternatively give up work altogether when they really can't afford to.
It is not a competition. We should all be pushing for everyone to get the best deal possible.

Completely agree, crunchymint, paid maternity leave became a legal obligation on employers in 1987.

In terms of older people paying more taxes... we do, unquestionably, need to move towards this. But not because of age, because of wealth.

We need to tax wealth more and earned income from work less. This is going to mean more pensioners paying more, but that's because they hold a disproportionate share of the wealth. It wouldn't harm the poorest pensioners, who own nothing or virtually nothing, and would potentially benefit them because we could then stop doing shit like trying to reduce NHS spending to 6% of GDP. I can't really see any way round this. One can only tax income from work, which is where most people get their money, so far. We already have real problems with productivity.