New NI tax. How are people meant to afford this?

[OnTheBrink1]

We bought our house just before covid, got a mortgage that pushed us quite a bit but worked it all out and it’s been doable since then. We needed to push the mortgage quite a bit because we were upsizing to get an extra bedroom for the kids and a downstairs loo and in our area and from what we had before it was a jump.
Been managing since then but no progression opportunities in DH job during the last 18 months due to covid it seems as recruitment was largely paused.
However, now we will now have to pay an extra almost £900 per year on this new tax. £73 I make it.
We don’t have any benefits of any kind.
It’s going to be quite a struggle to afford the mortgage and still maintain the car (which is old but we need for work and kids stuff) plus all the usual bills and food. Kids are between 8-12 and need bus passes, constant uniform and all manner of expenses of course.
I mean we will struggle by but it’s going to be tough to afford that extra £73 a month when we had all the mortgage planned.
Just don’t get how they can bring it in so soon when it’s such an increase. How are others in a more difficult position going to afford this? People will be loosing their houses surely?

@PersonaNonGarter

It’s absolutely outrageous to tax income.

They should have raised CGT or added Seller stamp duty.

That makes no sense, you would have to pay to buy and sell, so twice every time you moved house, that is utterly idiotic. If you raise CGT then the assets move abroad and you get a higher percentage of nothing, instead of 20% of something.

@Islamorada

Seller stamp duty. you really are creative. We bloody paid to buy. How much more can you screw people off.

You are aware that the price has risen since you bought right?

This level of entitlement is what is causing the unreasonable burden on working people. Of course sellers should pay stamp duty.

There is plenty to be said about the fairness of this method of raising money.
But honestly? There are more deserving cases for empathy than someone who pushed their household budget to the wire for an extra loo 🤷🏻‍♀️

@nanbread

The money needs to come from somewhere.

Yeah it does. How about the top 5% instead of those on 20k.

The top 5% of earners already pay half of all income tax and 96% of all CGT paid by private individuals. The top third of earners in the UK have the sixth highest effective rate of income taxation in the EU, the bottom two thirds have the lowest effective rate of income taxation in the EU. The problem is not high earners paying tax, it is everyone else.

@LegendaryReady

It really isn't right that the working poor are paying to protect other people's inheritance, but they know it's a vote winner among those most likely to vote.

How is my parents inheritance being protected by this? They still have to pay care home fees when they can't live independently anymore. In fact they will be worse off because fewer of their assets will be protected than before.

matilda you're right about tax but what grates with me is that in Scotland higher earners pay more NI than those elsewhere in the UK already.

Well I didn’t expect anything less from the Tory cunts 🤷‍♀️

Bit of a kick in the teeth

How did people think all this furlough money etc was going to be paid back? Surely everyone was saying at the time that itvwascsuch a huge debt that our grandchildren are still going to be paying this back.

@nanbread

The money needs to come from somewhere.

Yeah it does. How about the top 5% instead of those on 20k.

But if OP’s husband is the sole earner - it’s not clear, but it’s only his promotion prospects that are mentioned then he is pretty much in that top 5% that you suggest pays more.

www.google.co.uk/amp/s/amp.theguardian.com/politics/2019/nov/22/factcheck-earning-80000-or-more-top-5-of-uk-earners-labour

You’ve said yourself you needed to push your mortgage. I’ve never mortgaged to the max available and live a more comfortable life where sudden expenses don’t worry me so much

Tbf many people don't have a choice because house prices. Plus that hefty mortgage is often cheaper than rent.

@BeautyQueenIamNot

Well I didn’t expect anything less from the Tory cunts 🤷‍♀️

Bit of a kick in the teeth

So when you vote in Labour next time and income tax goes up by 3% you're fine with that then?

I think the problem though is living costs are very high as is childcare & income tax freezes mean despite having a on paper good salary you often don't have much left over.

I'm not going to hold my breath that this is going to improve social care one little bit.
I can forsee me being worse off each month, without any improvement to the care job I'm doing, because I suspect that providers will carry on exactly the way they are at the moment, and any extras they get going into keeping profit nice and healthy.
Covid has shown just how down to the wire companies can get their employees to go, how they can pile on more work, just how short staffed they can be, just how many corners can be cut, and now they're going to get more money, with no directive that it doesn't just go into profits but should go into actual care.
And we already have a shortage of care workers, can't see this making it any better. Still providers will be able to shrug their shoulders and whine that they aren't getting the applications, change nothing to attract the applications, and those of us left get to pick up the pieces. Yay!

We have a high income but live to our means. There isnt much we can cut back on that we haven't already as nearly all of our income is on school fees. We have two years left and we're done but it's tight right now.

Very worried about the NI raise. Due to everything else except our salaries going up, including dh who's actually went down last year we are really stuffed now. I'm shocked the government want to do this now.
I did have to hand notice into our school last year and it really upset our dc but then dh managed to find a new job but lower paid and we managed to keep the dc in school but after selling everything we had, so I just don't want to have to go through it all again and schools in our area have waiting lists so it isn't even as simple as pull them out come what may. Really down about it. I think I'll be taking on a weekend job worst case to make up the short fall.

@longue

You’ve said yourself you needed to push your mortgage. I’ve never mortgaged to the max available and live a more comfortable life where sudden expenses don’t worry me so much

Tbf many people don't have a choice because house prices. Plus that hefty mortgage is often cheaper than rent.

@longue agree many don’t have a choice. But the extra loo comment doesn’t suggest that OP is in that position!

I fucking hate the Tories.

I fucking hate how they’ve destroyed the NHS.

But - they didn’t make Covid.

This was always going to have to be paid for. I’ll have a similar NI impact, and I’m not happy. But… I’m glad it’s £70+ a month for me, and only £5+ a month for my low earning sister. Because it’s already taxing the better off.

@Baystard

matilda you're right about tax but what grates with me is that in Scotland higher earners pay more NI than those elsewhere in the UK already.

To counteract that though, Scottish people don't have to pay Uni fees, or prescriptions. It's really only the healthy childless Scottish that are affected.

The problem is not high earners paying tax, it is everyone else.

I would argue against that as the real higher earners ie not those on 100k often pay a lot less tax.

"Using anonymised data from personal tax returns, we show that in 2015-16 the average rate of tax paid by people who received one million pounds in taxable income and gains was just 35 per cent: the same as someone earning £100,000. But one in four of these paid 45 per cent – close to the top rate – whilst another quarter paid less than 30 per cent overall. One in ten paid just 11 per cent—the same as someone earning £15,000. The rich, it seems, are not all in it together."

@Maverickess I think that’s one of my biggest issues! I don’t mind (well, I mind but see the need) to pay more - if it was going to fix or even improve things. I have no faith that it will go into anything other than a Tory crony’s pocket in consulting fees.

@SeasonFinale
So when you vote in Labour next time and income tax goes up by 3% you're fine with that then?
It usually depends where you are on the scale. Labour will almost certainly only put taxes up on high earners. As usual with most people they say that they want taxes to rise, but what they actually mean is that they want other people's taxes to rise, not their own.

I am prepared to pay more tax for a better society, but from the tantrums on here it seems only a tiny fraction of mumsnetters are.

@Cocomarine I agree that those lower down the scale are disproportionately impacted & actually if this does improve things it's worth it. I have little faith the money will go to where it's needed & that we will see more tax grabs.

Some industries didn't get furlough, and haven't had payrises for a decade, salaries are already low for the responsibility held and this is the thanks

Hardly "middle earners" RVN123 if they are paying higher rate tax. You have a skewed idea of what the population as a whole, earns.

If you are going to be paying another £900 pa that means you have a household income of around £100k pa. If you are in a situation where your household income is £100k pa, but a cost increase of £75 pcm is devastating there is something seriously wrong with your finances.

If this calculation is correct, then I agree with this poster. When you are earning massive amounts, then you should be able to absorb £73pm without it worrying you. What are you going to do when interest rates start to rise again ?

Is anyone able to link to a table, indicating how much more people in different income brackets will be paying, please?

What I do begrudge is when i'm eligible free prescriptions won't exist or free tfl & my state pension will move out again i'm sure.

When you are earning massive amounts, then you should be able to absorb £73pm without it worrying you

2 earners on 50k each are not earning massive amounts. The issue is many or the actual 1% aren't on PAYE.

[quote Cocomarine]@Maverickess I think that’s one of my biggest issues! I don’t mind (well, I mind but see the need) to pay more - if it was going to fix or even improve things. I have no faith that it will go into anything other than a Tory crony’s pocket in consulting fees.[/quote]
There has never been ringfenced tax rises in the UK. This is just the line by design so that people don't complain. In practice, it all goes to the Treasury, and they allocate it.

Come the next election the Government won't even have to say this - it can just drop this line and it will. Money reallocated to... wherever they feel like it.

And this tax applies to the low waged by design. It has to. It won't stop houses being sold.

And btw, if you tolerate this, this new lower earner tax take will come again and again. Because its too good a lever not to pull; so its a test.

Still, if you vote Tory, you can either benefit from their policies or pay to aspire to their values.

Anyone who thinks they will reform the housing market or "level up" after this is on glue. Mind you, you would have had to be a bit dim to believe that given all that they have ever done. The clue is in the name.