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AIBU?

... to be appalled by this point in today's 'mini budget'

107 replies

SafferUpNorth · 23/09/2022 12:14

Abolishing the upper income tax bracket of 45% which applies to incomes of £150,000+...

I mean WTF? WHY? Do these people need help? Why blow a hole in the country's tax revenue to help high earners??? I know the answer, of course... because it's the Tories. But goddammit, this is so blatantly favouring the wealthy at a time of crisis, it's absurd.

OP posts:
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Am I being unreasonable?

492 votes. Final results.

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You are NOT being unreasonable
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pompomdaisy · 24/09/2022 07:45

It's quite sickening actually. I drove through a fairly poor area of Leeds yesterday. I saw three families all with children that were underweight. The Tories may not see it. Truss is happy to turn her back on Leeds and her state education but it's there and it's real.

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TrufflesForBreakfast · 24/09/2022 07:48

Voting Tory is like buying a brand new car. You have to be either very rich or very stupid.

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flowerycurtain · 24/09/2022 07:48

Surely most people on £150k plus were doing all they could to minimise tax. I imagine most of them would sit on a salary of 149999 for a long time. Then they'd increase pension contributions. Then gift aid some charity donations. Not sure what else you can do as an employee.

As others have said this who run their own businesses have various different ways they can adjust.

I get the concept they think this will bring in more tax to spend but I'm not sure it will work.

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foxinatutu · 24/09/2022 07:51

YeOldeTrout · 23/09/2022 22:25

Don't people on £100k or £200k (not me) find ways to be very tax efficient, they set up pay arrangements that help to minimise their tax, trusts, making themselves into a partnership or limited company, things like that? And then claim lots of tax-reduction expenses. I'm sure there are tax-clever options that become available to someone on these high salaries.

I'd like to know among the MNers on £100k/annum if they are paying 43%+ of their total income in tax+NI. Instead, how many are actually piling ££££ into their pension, sharing their income within a partnership, or finding other tax breaks?

For those of you on £100k plus, how are you going to spend your tax breaks in 2022+ ?

Percentiles, I think £100k is top 2.2%, £150k is top 1.2% of personal incomes?

Those that are paid a salary by an employer don't have the option to reduce their taxes in the ways you mention so they are paying the full amount of tax due, even if they have an accountant doing their tax return (which everyone earning over £100k is required to submit).

Personal allowance starts to be reduced at £100k and is lost entirely at just over £125k www.gov.uk/income-tax-rates/income-over-100000 this means there is no tax free amount, everything is taxed.

Pension allowance is limited to £4k at some point over £200k (not sure of the exact point) so putting money into a pension doesn't attract tax benefits. Also, the lifetime limit is around £1 million. So, the tax incentives to pay into a pension are limited.

I'm not saying any of the above is bad or wrong, I just wasn't aware of any of this until recently and it does affect the amount of income someone is allowed to keep.

For some high earners the tax saving will be spread amongst their savings for a house deposit, investments for their future and spending. Just like many less high earners.

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sashh · 24/09/2022 08:17

ClocksGoingBackwards · 23/09/2022 16:57

I am aware of how it works, thank you. No violins needed for me, I’m on a low income, I’m just not jealous of those who aren’t.

So why did you post such a misleading message.?

OP

Please spend that extra money in local shops / businesses. Obviously it is your money to do with what you want but you could have a huge impact if people like you spend money in your local community.

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Newmumatlast · 24/09/2022 08:30

foxinatutu · 24/09/2022 07:51

Those that are paid a salary by an employer don't have the option to reduce their taxes in the ways you mention so they are paying the full amount of tax due, even if they have an accountant doing their tax return (which everyone earning over £100k is required to submit).

Personal allowance starts to be reduced at £100k and is lost entirely at just over £125k www.gov.uk/income-tax-rates/income-over-100000 this means there is no tax free amount, everything is taxed.

Pension allowance is limited to £4k at some point over £200k (not sure of the exact point) so putting money into a pension doesn't attract tax benefits. Also, the lifetime limit is around £1 million. So, the tax incentives to pay into a pension are limited.

I'm not saying any of the above is bad or wrong, I just wasn't aware of any of this until recently and it does affect the amount of income someone is allowed to keep.

For some high earners the tax saving will be spread amongst their savings for a house deposit, investments for their future and spending. Just like many less high earners.

Yes some PP who have posted critical comments about people not realising how the tax system works and then seeking to explain it have missed off this part in your post about the personal tax allowance

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ClocksGoingBackwards · 24/09/2022 10:08

@sashh I didn’t, I just posted my opinion. I’m not in control of the assumptions people make based on that.

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