DH and I going part time to deliberately reduce wages

[Bucketheadbucketbum]

Just working out the free childcare hours and actually DH and I will be muxh better off if we both dropped to 3- 4 day week to deliberately reduce our incomes. Would obviously be nice way to live too! Anyone else doing same? Seems mental but we've looked at it 100 times over and it's true!

@Jonei it certainly is and none of them ever come back to confirm what they are paying in!

You think NI credit of a few hundred pounds, in order for a (usually mother) parent to be entitled to full state pension on retirement is equivalent to full time free childcare for someone on £100k who will have a massive pension regardless? No wonder the country's finances are on its knees.

Wrong end of the stick there @Mycatsgoldtooth. I think it's wrong for a SAHP to have their NI contributions met if THEY are earning £100k. Any SAHP with no earnings should have their min conts met so they retain state pension entitlement. Nobody should have their conts met (or receive CB, or UC, or free childcare) if THEY are earning £100k. HTH.

Obviously don't disagree that the govt should help out single parents at the lower end of the pay spectrum. But if you're earning enough to care for yourself and your kids, then living on your own without sharing the house is a lifestyle choice imo!

What? I should just move a random person into my two traumatised, autistic children's come to save money? I haven't asked for any "support" from the Government. Just for them to stop penalising me by taxing me MORE than other households with the same income.

A system based on household income would be impossible to administer.

That's funny. I wonder how France, Denmark and a large number of other developed countries have managed the impossible. Perhaps we should ask them.

I'm absolutely aghast at the sheer number of people who think it's okay and even right and proper for one of the wealthiest earning families which falls in the 1% of top earners in the UK (apparently two earners on over £100k each) to minimise their income so they can claim free stuff from the government. I though we were against rich people dodging taxes, or is that only if they are overt Conservative voters? Bloody unreal.

You've phrased that better than me @StatisticallyChallenged

I just don't get some of the responses to this. What we know and presumably all agree on is that bottlenecks exist across a wide income spectrum, some people will feel their circumstances are better if they take action to stay under them and that because of inflation and fiscal drag the number of people for whom this is a relevant decision will increase. These things are all completely uncontroversial and not affected by anyone's feelings. You don't have to be concerned about any of them to understand that.

I'm not even saying that people have to agree this is a problem. One take is that it's better in the long run if more people increase pension contributions, so incentives to do that are a good thing. That's not my view but it would at least show that some thought had gone into it. But airy dismissal of the issue because you don't have any sympathy with some of the people concerned is plain silly.

You might want to consider what proportion of the total tax take those people are funding for everyone else.

Talk about biting the hand that feeds you.

This is exactly why we will never have higher funded public services, because the ultra high earners and wealthiest in society don't want to pay for them, want more free stuff and then complain that services aren't good enough. You're right, the system is broken but that doesn't mean you have to use it to your advantage.

They're not "claiming free stuff". They are using the services that they fund for themselves and everyone else.

I do hope nobody is daft enough to think it's only higher earners who ever make this kind of calculation. As I said upthread, my parents were applying the same principle to tax credit awards 20 years ago.

This was in response to OP saying they both were over the threshold and both would have to work less - if only one of them is above, then the other doesn’t need to reduce their hours.

Part of the reason the system is broken is because of these perverse disincentives to earn more.

I don't think you can reasonably expect people to work more hours in order to be worse off. Most humans are not that altruistic that they will choose to work an extra day every week in order to have less.

We run a small business and have part time staff who do exactly this calculation. We have someone being promoted and simultaneously asking to reduce hours slightly to stay under a threshold.

These are systematic issues. Blaming individuals doesn't solve anything (unless you're blaming politicians of course!)

It’s not after tax, it’s taxable income (net adjusted income).

Ignore that, I misread your post

It’s not feeding me. I was a higher rate tax payer for most of my working life and my “taking” years were well before that. In any event the “feeding hands” are those earning over £150k, they pay 12% of income tax.

Free stuff? They pay the majority of it to allow others to have the 'free stuff'.

I am so delighted to pay 40%/45% of everything I earn. I do so with a smile on my face.

But I'm not going to work for free. I have absolutely no moral imperative to work for free. Nobody does.

Can I ask where that stat is from, as it doesn't match the HMRC numbers I have - but I know what they're like for putting out conflicting data!

I think your stat is actually too low. Data I have suggests that (rounded for laziness)

100-150k income bracket pays 13% of total income tax liability
150-200 - 7%
200-500 - 13%
500-1m - 6%
1-2m -4%
2m+ - 7%

Total of 49% roughly comes from people earning over 100k

Nearly 25% is from those between 50 and 100k

Means that nearly 3/4 of income tax revenue come from those earning 50k+, which is about 19% of tax payers

Nearly half comes from 100k+ - about 5% of tax payers

(Thats from hmrc income tax stats btw)

Thank you. I’m wrong as according to your figures, those earning over £150k appear to pay more like 37% of all income tax.

Crazy isn't it. Doesn't make the 100-150 not valuable contributors though - but income tax receipts are hugely dominated by higher earners so I don't understand the demonisation (generally, not by you!)

Question is whether 100k+ would actually be paying even more in total if the system was better. Just how many people are choosing to effectively stall just under that threshold - whether due to childcare or just the tax hump.

Respectfully, if you're paying 45% tax you're not "working for nothing". 🙄

She is for 45 percent of it. She could do less work, pay less tax and spend quality time with her family instead.

I agree. It's madness this government introduces free child care for people who don't work. Wtf are thry up to?

Honestly am sick to death of funding laziness.

OP you ate yoyr DH like many other lazy people are OOO.