To think the child benefit arrangements are unfair?

[MobLife]

Only just clocked this and I'm still not 100% sure I've got it right because it seems wrong...
So if 2 parents are both earning £49,999 and hence taking in almost £100k household income they can continue to claim full CB

But

2 parents where the household income is way under that (lets say for arguments sake £70k) and one parent is earning the greater proportion (between £50-60k) will either get a much reduced CB amount or potentially nothing at all?

How is that fair??!

Per the thread, it's not just an issue about CB being unfair. The unfairness extends across the whole system: tax-free allowances, the threshold for higher rate tax, the withdrawal of CB, the withdrawal of the free nursery hours/ tax free childcare, the withdrawal of the personal allowance, etc.

Surely everyone can accept it is insane for a single parent household to be taxed more than a dual parent household with the same income, who have two people to do work or childcare? Only someone utterly mad wouldn't support the policy change I've proposed, there is literally no argument against it that makes any sense at all. So why is it not being changed? Why are people not demanding that it is changed?

Personally I think it should be stopped anyway. It’s very outdated. For those who need, it should be added to other benefits but reading that some people just save it for 18 years is ridiculous. No wonder the country is in debt when it gives money to people who don’t need it. The winter fuel allowance too. I get that some people need it but I know a related couple on £80k a year between them and they get it! To be fair they give it to charity and fully accept they shouldn’t get it.

Retired

Per the thread, it's not just an issue about CB being unfair. The unfairness extends across the whole system: tax-free allowances, the threshold for higher rate tax, the withdrawal of CB, the withdrawal of the free nursery hours/ tax free childcare, the withdrawal of the personal allowance, etc.

Yes, now I think about it, scrapping the whole lot seems fairest. Thanks for the suggestion.

If you earn 50k, on a standard tax rate, and no other deductions
Take home is £ 37,662.16

If you earn 60k, on a standard tax rate, and no other deductions
Take home is £ 43,489.16

So that's about 6k difference

I dont know about the other options tax credits etc

What do you mean, "scrapping the whole lot"?

Scrapping all tax completely? Scrapping tax thresholds and the tax free allowance?

If this was an attempt to troll it was poorly phrased as it's not even clear what you mean.

I have no idea what the fair way is! Maybe make it universal again? Taking into account the entire household income doesn't seem fair either as lots of families have adult DC living there who work - this would form part of the household income, yet they are hardly helping to fund their younger siblings! Or perhaps older relatives live there who are receiving pensions.

A family with one high earner and one SAHM don't have to worry about paying for childcare, or have the costs of working for the 2nd parent so that does give them an advantage compared to a family with no working parents on a similar household income. But then a two parent working household get to take advantage of two lots of tax free income I guess? Meh, I have no idea what is fair!

As many have pointed out, single parent households are clearly the most adversely affected by this policy so something should definitely change for those households at least.

This is exasperating. If you don’t know about it, or seek to understand the issue then why comment! This is the same as earlier with that person who just kept saying ‘can’t be right’ and then messing up their own figures .

if people aren’t capable of understanding it, fine. but this family ends up with less net income on 50k than 60k. If you’re interested - read it again, if not don’t bother.

yes, you’re right - their income from the one job is as you say - but their household income - which is what counts is reduced for every £1 above 50k.

one more time I’ll spell it out

£1 earned

40p taken in income tax
3.25p take in Ni
33p Of child benefit taken away
41p of tax credits taken away

adds up to £1.1725 loss, on £1 earned.

@PrivateHall by entire household income people mean parents , not anybody else who lives at home .

Exactly. Nobody is saying people in a HMO should share tax thresholds. 😆 But surely the number of adults supporting themselves or also children in one family unit is relevant and the total income for that unit should be the basis of tax etc. As a PP said, is done in France. As is done with other UK systems, when it suits the Government to do so.

Scrap all benefits. That'll be as fair as you can get. No one gets anything.

Trolling or world-travelled ? Your call.

So how do you decide who is included in household income then? Posters have said that they moved in partners who are not the parent of the DC/ they did not share finances with, but this still impacted on their ability to claim CB. There really is no easy way to make this 'fair'.

I think it’s fair to say the people included would be the one or two adults in the house acting as parents , the fact that people move in together and keep separate finances is their choice , they are still seen as a unit to the tax man .

We are currently living in a country where two people, working full time can qualify for benefits.

now - I absolutely agree that scrapping state aid for such families should be the right thing to do .
but, then you think about it a bit. How come they get benefits in the first place?

and then you realise we have a country that has been bought and paid for by landlords and big business - inflated rents, limited social housing and shit wages that don’t cover the cost of living.

meanwhile - the rentiers and shareholders make bank on public funds - because they are the end recepients of the state aid.

so scrap it indeed - but then we need genuine living wages and non inflated housing costs.

If you decide to move in with a partner you by definition become a joint household. So yes, partners unrelated to kids would be included. Housemates or elderley parents or adult children obviously not. Other tax systems manage this, it's not rocket science, and pretending it is, is disingenuous. You make a declaration like with TFC or whatever. Very simple, and UK Govt already uses these methods already when it suits them to do so.

Exactly. People on tax credits have had to file an annual household income statement for knocking two decades. But for child benefit?

‘Way too complicated’.

What a crock.

Scrap all benefits. That'll be as fair as you can get. No one gets anything.

Trolling or world-travelled ? Your call.

You're not the only one who has travelled the world. I've worked in orphanages in countries with no welfare systems. Most of those children weren't orphans. Their parents just couldn't afford to keep them. So they gave them up to live in institutions riddled with lice and scabies and worse with hardly any food and no love. No education.

And those are the lucky kids of poor families that were "given up" rather than sold.

If that's your vision for a better country I'd suggest your travel has been rather limited to nice resorts and beaches.

I honestly think single parents should get their personal allowance doubled, as well as this.

the whole tax system is nonsensical. No one should be paying any tax until their basic needs are covered out of their income.

Instead we get this ludicrous dance where you pay tax first and then get it back through a state benefits, which is demoralising, a trap and woefully inefficient.

And before anyone says ‘we all have different basic needs’ - the government has implicitly worked those levels out via the benefits system already.

If they say ‘on a net income of X, you get Y in benefits’, where X+ Y equals to or exceeds the family units gross income, what was the point of taxing them in the first place?!

Agree completely.

Scrap all benefits. That'll be as fair as you can get. No one gets anything

sure. When I first qualified as a teacher - and I am a shortage subject teacher - I earned £1.2k a month. My childcare costs were £1010, or thereabouts, a month. The CSA/CMS have not got a penny out of my ex in 13 years. So, how would I have managed if I hadn’t received tax credits, child benefit and a disability premium for one of my children?

I’d scrap child benefit to be honest. The people I know who are closest to abject poverty are single without kids, who work just enough to be entitled to nothing, but are paying for wealthier families to be able to accrue 18 years of savings. I was on the verge of homelessness a decade ago but wasn’t entitled to anything because I had no dependants. It’s bonkers.

It’s also not a popular view but the answer to ageing population isn’t more children, it’s voluntary euthanasia. That way we don’t have to keep throwing more and more money at people for making a choice that they want to make but justifying it as being important for society.

Yes, all of this. As a widowed single parent, I do have some vested interest in the first part - for the sake of my blood pressure, I have to try not to think about how much less tax my partnered colleagues pay (either individually if they have a non-working partner who has transferred over their tax allowance, or overall as a household). Until this thread I hadn’t realised they of course also get double the tax free saving limit.

I agree that 50k probably is a reasonable CB threshold, but for a household not an individual.

What I've advocated - taxing on a household basis - would benefit childless single people, too. It would be mucj fairer for everyone.