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?

Whatever shit happens in this country - the rich can always get away, the rest of us have to put up and shut up!

When I first started work the bottom income tax was 33%. The top was over 90%. It was cut to 75% in the 70s to stop high-earners leaving. Imagine Corbyn taxing high-earners at 75%! You don't know you're born.

It’s easy to preach when life is so fucking easy

are you talking to me?

my point - badly mad, yes- is that neither labour or cons do anything about inequality, they hardly touch the landed classes or bother with tax avoiders and evaders: taxing highly paid salaried workers is just picking low hanging fruit.

Well, since 2008, the highest earners have seen their wealth grow substantially, meanwhile, everyone else is, in real terms earning less than they did in '08.

Corbyn wants to put corporation tax back up to 2010 levels and rise higher rate tax by 5% wow!

Its pity people like the OP don't show the same concerns for nurses, physio's occupational therapists etc etc who will leave uni owing 50k and earn 24k, as they do for their own welfare.

I believe 50% of workers don't pay any income tax, which is actually quite shocking they earn so little.

My mother didn't receive child benefit.

Bollocks.

It’s all viral marketing in behalf of the Tories, and it’s outrageous.

@BertrandRussell have you been reading the new Ben Elton book too?

Not sure why you’re getting crucified, OP. I don’t believe anyone in your position would have done anything differently. Turning down the opportunity to save in order to provide for your family just so you could ‘give back to the country’ sure.

I would love to know where you moved to though as I’ll happily follow.

So you'll be happy with no doctors, GPs or dentists then, who are already reducing their hours to avoid punitive marginal 62% tax and penal pension fund taxes???

Ha ha - it's an absolute myth that people like British GPs and dentists are suddenly going to up sticks and move to Saudi Arabia because they have to pay a bit more tax in the UK. It's typical Mumsnet mentality of "just move" being the solution to any problem.

The vast majority of people want to stay in Britain, where their families are and their roots are. They don't want the disruption (and huge expense) of uprooting their kids, who may be in school, and finding employment in a country where they probably don't speak the language and where living standards may be considerably lower than what they're used to here.

I'm tired of this argument being trotted out regularly as an excuse not to raise taxes on those who can easily afford it.

You must understand that in order for you to enjoy the luxuries that come with your very privileged life, you will require the skills and services offered by people who don’t earn anywhere near as much as you. For example for you to go on a nice holiday, you rely on Border Control officers (salary £25k), cabin crew (salary £15k), etc. The privilege of not having to clean your own house requires somebody else to do that cleaning. To go for a nice meal requires chefs and waitresses and cleaners. The person that does your childcare earns £14k a year and without them you perhaps couldn’t do what you do. Basically everything that gives your life value is provided by people who probably earn a far lower wage, yet these people are all integral parts of our society. I know it can’t happen but if everyone decided to start a business and move abroad our society would literally collapse. Higher earners are expected to contribute more financially because they have more to contribute, but the things we get to enjoy as part and parcel of living in a society that provides things like healthcare, schooling, infrastructure etc is invaluable. It may be galling to see half your money being ‘taken’ (and it is for everyone btw not just high earners) but think about where that money is going. It’s creating a decent society for EVERYONE, including the people who can’t afford to contribute quite as much but who without we couldn’t function.

Obviously you are entitled to do as you please and you aren’t in the minority but I wish more people would stop thinking of tax as a punishment!

“@BertrandRussell have you been reading the new Ben Elton book too?”
I was way ahead of him!

So you'll be happy with no doctors, GPs or dentists then, who are already reducing their hours to avoid punitive marginal 62% tax and penal pension fund taxes

We've had TEN years of tory rule.

We ve few NHS dentists (none in Cornwall), can't get GP appointments for weeks and people with cancer waiting months for treatment.... and you worry about Labour ???

The Conservatives are not working!

Try and look at the big global taxation picture OP. Anywhere compared to the Middle East is probably going make you wince tax wise. Lots of people do a stint in those countries to get some money in the bank right? But try and take a good long look at the culture of the place you live in within your high-class compound ....zero welfare state, malnutrition amongst the poor, people practically left in the gutters to die and brutal police-run states operating a draconian law. I don't think it would be very nice as a wealthy person sitting in my little island of wealth surrounded by a picture of wide scale suffering.
On the other hand, you could head to a Nordic country and pay even more taxation than the UK and you and your growing family could enjoy state funded access to a great variety of social services from cradle to grave. Just depends on your personal outlook and values, your long-term or short term vision for yourself and your offspring I feel. The UK i think has a decent balance for most. We are a high income family with offspring working in the health service. We could have legged it overseas but we thought about our kids starting out for themselves....they have to make their own way, no depend on our handouts. The UK is a good place for people that try and work hard as long as they don't insist in living in the south east.

This is exactly why we should all do our best to buy local. If it comes from the internet, there's every chance somebody isn't paying their way in society.
Selfishness is the fashion now, but I'd rather pay more for a product than deal with Amazon etc., and I shunned tax avoidance scheme s when they were relevant to me. I'm lucky that I can afford this, and because I can, the decision becomes about self-respect.
I'd like to see higher property taxes for non-dom owners (people or corporations).

my point - badly mad, yes- is that neither labour or cons do anything about inequality, they hardly touch the landed classes or bother with tax avoiders and evaders: taxing highly paid salaried workers is just picking low hanging fruit

They can - and labour are offering more than just taxing higher paid workers.

At the end of the day, our economy and how you earn money is changing and the tax system needs to catch up with that.

Not sure why you’re getting crucified, OP.

Just highlight the OP's posts and you'll see that quite apart from being a self-serving ligger, she knows fuck-all about tax, while claiming that's why she want to be outside the UK.

I'm a low earner and always have been. One thing I've noticed is that the richer people get, the greedier they get.

I'd happily pay half my earnings in tax if I was earning 6 figures, it would still be 10x what I'm earning now. I'm not greedy, I don't need thousands and thousands squirreled away in the bank and multiple properties. If I had enough to live comfortably on with no money worries then I'd love to be in a position to be able to help others in some way.

I don't blame you, I'd do the same.

I’m not sure what you want to hear?

as an excuse not to raise taxes on those who can easily afford it.

see, that is exactly the problem. People who believe it's ok to penalise and punish anyone who earns more than them.

Ok, so I've done a rough calculation of how much I cost tax payers whilst I was living in the UK.

I have calculated my cost on the NHS using this tool here: www.gocompare.com/health-insurance/the-bill-of-health
It comes to £4500 (and I massively overestimated how many GP appointments I've had)
My state education cost £16,000 apparently (link)

So my education and medical costs = £20,500

My salary from age 18 to 30 was £26,000 per year on average (I added up my annual salary every year, then divided it by 12).
My income tax (not National Insurance) per year would be £2700 on this.
So I have paid £32,400 over the last 12 years in income tax.
I know that income tax doesn't just pay for education and the NHS - but this is the thing that people keep bringing up.

Neither me nor my mother have claimed benefits - but benefits come out of NI payments...
I also have paid £25,020 over these 12 years in National Insurance.
I also have paid, on average, £110 per month in council tax = £15,840.

Those of you saying that I have taken from the system and not paid it back, are deliberately ignoring the above facts.

Up to the point where I left the country, I had actually paid MORE into the system than I'd taken out - and that was as an average earner.

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

I remember Max Bygraves being interviewed and saying every time he saw a tank he said "I paid for that!"!

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

The op has a valid point. Because, she is a case in point, whether you like it or not.

She earned a lot herself, making personal sacrifices (100hr week end risk taking) and the state wants far too much of her money. So she goes abroad.

Many, many people have done or will do the same. It’s like the time when they taxed people on 100k (?) at a huge rate and so GPs cut their hours to avoid falling into the huge tax rate trap.

We all lose out when the govt think that high earners can pay and pay and pay with no consequences.

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.

People will go part time to cut their salary, retire early, go abroad etc. It’s just stupid to think otherwise.

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. They buy loads of stuff as well. So we lose that as well.

People who believe it's ok to penalise and punish anyone who earns more than them

This doesn’t happen in reality though, does it.

We don’t have low earners in government. They aren’t represented in the room when discussions about tax or salaries are held.

So what actually happens is that those who can afford plenty are driving the decisions.

Then, in a faux outrage, bleat that they’re being fleeced by those who dare to be poorer etc etc. When they’re the ones who decide the tax rates.

zero welfare state, malnutrition amongst the poor, people practically left in the gutters to die and brutal police-run states operating a draconian law.

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

The government here is actually very wealthy - based on taxing businesses (mostly banks), property purchases and in exports. And no, they don't make much money from oil.