High earner leaving UK because of tax

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Hi all,

I'm well aware that I'm highly likely to be utterly slaughtered for this (thus the name change) but having read the thread about Corbyn and seeing several people saying that the theory that taxing high earners would make them leave the economy is a myth, I thought I'd share.

I'm British and was bought up on the breadline, went to state school, have a disability - just to pre-empt the "privileged" comments.

I started a business not that long ago (fortunately selling a service globally, and not registered in the UK as its main market is the Middle East) in the first few months it became obvious it was going to do well and I hired an accountant.

To cut a long story short, if I remained UK resident then my tax bill for my first year would have been approximately £120,000. This would have been just under half of the money I bought in.
Year 2 - tax bill would have been £230,000.

My family are not well off, so I was supporting a fair few people on this plus I started with nothing, so my first priority (after my family) was to save for a house as I was living in rented accomodation.

I am well aware that I am earning a high salary, and would never argue otherwise. But reading on here, people seem to think that a 6 figure salary means that you buy yachts for a laugh and eat diamonds for breakfast.

Good size family houses in my area started at about £500k.

For us, it made sense to move abroad for 5 years or so, save the money otherwise spent on tax, come back with that lump sum and buy a property outright.

And that's what we've done, it was insanely easy.

Now, the current plan is to come back to the UK in a few years time and settle down. We'll have a nice house then, and the tax bill we'll just suck up because we like the UK.

I keep seeing people harp on about raising taxes for the wealthy...if this happens, I know that we won't end up moving back. Because paying out half of my earnings is galling enough.

The top 10% of earners pay 60% of the tax bill.
The top 1% of earners pay 28%.

These people will also be privately funding their own medical care and schooling for their children. They'll also be heavily contributing in other taxes and of course pay VAT on the things they buy.

Raising taxes, abolishing private schools, penalising the wealthy in other ways is just going to drive them out of the country - leaving the tax pot far emptier, but the majority of people still relying on it.

AIBU to think that penalising the wealthy is not the solution?

Plus these kinds of people employ cleaners and gardeners and all sorts of people. So they suffer as well if the rich person goes abroad

I bet they don’t pay cleaners enough to earn a living solely on those earnings though.... hence the need to benefits.

I know someone whose h is a very high earner. They have decided to leave the UK if the tax rate is increased. So not only do we lose his taxes, we lose his talent

And that talent would be?

The country I live in doesn't have any of this

And yet you still won't name this paradise.

Such bad faith.

What about the benefits you’ve received such as a decent police force, a road system, a stable country etc etc?

I actually went down that road but it got a bit lengthy, and the point was the same.

My road tax goes some way to contribute to the roads, obviously, and I believe council tax pays for the local police?

I was just doing a simplified income tax = education and healthcare.
Of course its more complicated than that - but then that's why I mentioned council tax and NI.

I didn't mention VAT which of course also goes into the tax pot, nor my employers NI etc etc.

@echt Honestly at this stage anyone with an ounce of sense and access to Google could have figured it out by now.

No need to be rude. You started the thread.

While you as an individual may well have paid in more than you got out, at the moment, at any time in your life it could have been so much different.

And that’s part of what paying taxes is about. You never know when it all might go tits up.

classic MN.

Throw a load of accusations at the OP. OP responds sensibly and shuts them all down.

MN: no need to be so rude
and/or a few whataboutisms.

Also

OP spouts a lot of factually incorrect nonsense
MN corrects it
OP ignores it

@DoctorAllcome Technically you do get penalised somewhat the more you earn - if you earned 250K you wouldn’t be entitled to your tax free personal allowance of £11,850 anymore etc. So not exactly as straight forward as everyone getting that, and then the basic rate of tax etc etc.

I still don't understand what you actually wanted/expected to get out of this thread, OP.

I'm a high earner, seriously thinking about leaving the UK if boris Johnson and co get in. I just don't like the sort of hard cruel and selfish country this is becoming.

A good book to take a look at is 'The Spirit Level'. It shows the benefits to everyone in society of a more equal spread of wealth.

Health, Mental health, happiness and stress levels are better for everyone in more equal societies.

MN: no need to be so rude hmm and/or a few whataboutisms

The OP was rude. Her advice about googling the country she has chosen to live in was directed at me, with the words anyone with an ounce of sense, implying I'm the problem while she has given zip info about it despite being asked by many posters. So yep, rude. Not surprising as the OP must be rummaging madly in her bag of things to say when the overwhelming MN response has been that she is conscienceless.

I don’t really think of taxes as what I personally get from them, on an individual level they paid for my schooling, my NHS appointments and treatment, my use of the roads, my enjoyment of the parks etc, but I don’t think of it as a bean counting system where I track my contribution and the things I don’t personally use. For example I’m happy they help out vulnerable people and help sick people get treatment other than me and my loved ones, I don’t have kids yet but I don’t resent them going to childcare or to community centre youth programs. Yes there are things I wish my local/central government didn’t use them for but overall I don’t resent the system. I was out of work for a time and signed on, I’ve been working again since for years and have paid back what I took out but I’m grateful that it was there when I needed it as you never know what is around the corner.

There’s also things you can’t really track per person, for example builders and tradespeople lean their profession with the help of tax funding, and we all benefit from buildings and trade. They pay to train nurses and teachers who educate/treat us and our children, or even if you go private for those things then they are still helping those around you.

Council Tax and rates have never covered the full cost of council services. The Conservatives want councils to be self supporting from receipts and business taxes but central government still supply a chunk of their money from taxation. So yes, your tax does support things like bin collection, road signs, youth groups, housing benefit, planning and licensing.

Great idea OP! Nobody should pay tax at all, there should be no benefits or NHS, and if your parents were on the breadline you should have been allowed to starve, or die from untreated medical conditions like people in third world countries do. Sounds great 👍

YANBU OP. DH is a middle earner - 60k as I am I (Self employed so varies). We also have a rental property. On holiday in Norway recently we realised that we are paying 15% more tax on the rental income than in Norway! Norway has also abolished inheritance tax.

What I notice about other European countries is that the tax is not that much higher, once you take other taxes such as council tax into account. But you get more for it. Particularly in terms of transport infrastructure which benefits everyone, rather than a welfare state that benefits the 37% of all adults of working age who do not pay tax in the UK.

Cars and car use seems to be more heavily taxed elsewhere, but if the transport infrastructure is better then that benefits all because you have less crowded roads. I'd rather do something else with my time than sit in a traffic jam breathing in fumes.

I think we will leave the UK and move abroad because of this. If there are tax cuts for higher rate taxpayers, we might reconsider but tbh I'm sick of being punished by paying a higher proportion of tax the harder I work and I'm also sick of the constant aggressive socialist rhetoric in this country, demonising normal hard working people.

(Six figure income, DH also self employed high earner and we both happily pay our tax with no attempt to shirk it)

What a heart-warming rags to riches story, OP. It's almost like a fairy-tale.

Of course, I would have cost more than just the sum of my education, medical and benefits - but this will give a general idea.

Not really, I mean off the top of my head, you've not included any of your use of roads, bridges, pavements, utilities, internet/phone lines, lighting, government services (central and local), public transport and so on.

But who cares, you're ok now, you've paid your dues so fuck everyone else.

QualCheckBot interesting you find that - we live in Canada, and taxes are similar but services far fewer. You pay out of pocket for prescription charges (unless you have private insurance), social services provides far less. So I’d be surprised if European countries managed significantly better services for the same money. Perhaps their costs are lower, or perhaps the scope of what they provide is more limited.

YABU

You benefited from the state by way of free healthcare, free schooling etc. and now it's your turn to put money back in the pot but you don't want to

Low income earners spend more of their income by proportion on tax as tax is not limited to income tax, but VAT, council tax, fuel duty etc., leading to them spending more than half their income on tax but as they are poor they don't get to run away to a different country.

The pinch you are describing you will feel is what normal people are experiencing every day in this country.

The nerve! Very selfish, you got what you wanted by being supported by the state but subsequent generations must be denied the privileges you were afforded.

I used to live abroad. Cost of living was higher but tax lower (Singapore). When I returned to the UK I took a similarly paid job but because of taxation hadn't realised how much I would struggle. It's taken a decade to get a post tax salary that was on a par. I've been unemployed for some of this time.

But. As lovely as SG is. There isn't social care in the same way. I was fine (healthy) but a friend got a 15k bill for his child's broken leg and it crippled them. I had more disposable income but not that much more! My partner had health insurance through his job but I didn't.

So I don't know if YABU or not. Do what is right for your family (I can't criticise you for that) but social care is there for when you'd be screwed otherwise. Taxation is how that's funded.

You said it yourself though your business is in the Middle East. Many of the people threatening to leave are here as they sell their items to us. If they want to leave let them. There is obviously a market here as that is why they were here, plenty of people to take their space.