Rishi pays tax at 22% and NI.

[GPTec1]

This really, £5m in earnings, tax 1m, rate at 22% and no National insurance.

Not bad is it? yet all we get from the 'right is "the wealthy pay enough already"

Do they?

I bet all those on/or have been striking in NHS, education, rail would love an overall rate of 22%.

Should we all pay tax at 22% ? regardless of earnings?

Another point of view, how much tax are all the reporters paying on their earnings and investments? Many will be in the top 10% or 5% of earners in this country and will be using tax efficient methods to reduce their tax %. Yet they are the ones portraying this as a big deal.

So they shouldn't report on our regressive tax system and how our PM benefits from it while increase the tax burden on middle and lower income people both by direct tax rises and freezing thresholds, just because they themselves benefit from the same system?

And yet it's more than most people will pay in tax in their lifetime.

I don’t really understand how people can have an opinion on this when they clearly don’t know the difference between dividends and capital gains or what PAYE is for.

The additional rate is payable on dividends at 39.35%. It is lower than the 45% income tax rate on salary because dividends are paid out after corporation tax whereas salary reduces profits for corporation tax in the company. The rates have therefore effectively been equalised.

Rishi probably can’t take a salary instead of dividends anyway as he likely isn’t an employee in all of the companies he receives investment income from.

Capital gains arise on the disposal of capital assets and are taxed at lower rates.

He is adhering to all of the rules, and as the income tax rules have changed very little over the past few years you can hardly accuse him of fiddling the system.

personally I think dividends ought to be taxed at the same rate as income tax - this would instantly remove a lot of IR35 / personal service company shenanigans.

I’d also drop the VAT registration threshold to £10k as there are a lot of companies claiming to have a turnover of £84,999 currently either through taking on less work in order not to have to register or just plain tax avoidance.

This ‘outrage’ reminds me of when David Cameron was ‘caught’ earning income from BVI or Panama or somewhere. It was all over the papers until a Chartered Tax Advisor on TV pointed out the income was all fully declared on his UK return and the tax due paid in full.

The sorry ought to be ‘Man earns income, declares it on his return, pays in full’.

Oh, I'm sure "the rich" can take it...😂

@Eleganz they should report it giving context such as explaining the tax system and why % tax overall is lower. For example someone on £60k doesn’t have an tax rate of 40% their overall % is?

@Eleganz National Insurance contributions do not reduce taxable income. Whoever told you that is wrong. National Insurance is just another tax and should be regarded as such.

Fair point, NI is a tax. I was thinking about deductions that reduce taxable pay e.g. pension contributions. However, my calculations did not deduct NI so are roughly correct.

He still paid more tax in one year than most of us would pay in 5 or even 10 years or more! I really cannot be pissed off about this.

I'm not a Sunak supporter. I'm not a Tory supporter.

Sunak disclosed his tax payment and they are all legal. He pays the legal amount of tax. The fact that it's stupidly low for the rich is neither here nor there (I do think dividends and the like should be taxed more); everything is above board.

Exactly. I also think someone who has managed to become wealthy may be a good person to run the country.

Sunak disclosed his tax payment and they are all legal. He pays the legal amount of tax. The fact that it's stupidly low for the rich is neither here nor there

I think it being stupidly low for the rich is exactly the point here - it all sounds legal but it's hard to argue it is fair. And as PM and former chancellor he's not just responsible for paying his own tax, he is also responsible for designing the system.

He also paid tax in the US on this income: BBC website states:
The document says "some of the income of the US-based investment fund is also subject to tax in other jurisdictions (including the USA)".
I would rather have some one who has made is own money and has good investments as PM than someone who has no idea about managing money

It's not fair, no. I completely agree that the system is shit for everyone except the rich and Sunak had a hand in designing said shit sustem. But Sunak hasn't done anything wrong in this regard, which is what the disclosure proves.

People who start threads like these rarely understand the detail behind whatever they are ferociously typing about.

Unsurprisingly most complaining don’t understand a whole lot about either taxes, or what he is paid dividends for ( companies he is not an employee of ) and I suspect most won’t have ever started or invested in a single company, large or small, in their life so do not understand why there are ‘benefits or advantages’ like those mentioned. Go start a business, create some wealth for the country and then understand just what is involved in terms of your obligations- VAT returns cost money for businesses to complete and are essentially collecting money for the government ( and you all ).

The additional rate is payable on dividends at 39.35%. It is lower than the 45% income tax rate on salary because dividends are paid out after corporation tax whereas salary reduces profits for corporation tax in the company. The rates have therefore effectively been equalised.

Where did i say he NOT paid exactly what he owes? or acted in anyway improperly? no i didn't, so put your claws away and answer the point.

Anyone trying to justify his 22% tax rate on earnings of £5m, might want to equally justify why a nurse is paying 33% on earnings of 33k.

& Yes "its within the rules" we all know that.

He hasn't started a business, he has invested monies in the USA.... hence investment income and CGT

So stop with the diversion on to ltd companies, directorships and dividends.

He hasn't started a business, he has invested monies in the USA.... hence investment income and CGT

So stop with the diversion on to ltd companies, directorships and dividends.

🙄I didn’t say he had started a business but the discussion isn’t just about this one person but the laws in general around companies and dividends, Vat etc so my comment isn’t a ‘diversion’ it’s in relation to comments on this thread. Now, don’t you selectively take apart my comment which said clearly ‘ started OR invested’. Please don’t tell me to stop commenting how I wish to, that’s rude.

The prime minister paid £325,826 in capital gains tax and £120,604 in UK income tax on a total of £1.9m in the last tax year.

Of that £1.9m, £156,163 came from his parliamentary salary, £173,398 come from investment and savings income and about £1.641m from capital gains - profit made on the sale of assets. (From https://news.sky.com/story/rishi-sunak-releases-his-tax-return-after-bowing-to-pressure-12840264)

Such a non story, he has paid the right amount of tax.

It is a good idea when you are a politician wading into an argument about wealth to make sure that your own finances do not provide a hostage to fortune...
The Labour leader, it turns out, is the beneficiary of secondary legislation that exempts him, and only him, from the cap on tax-free pension savings that he wants to reimpose on the country if he becomes prime minister. This bespoke law, Pensions Increase (Pension Scheme for Keir Starmer QC).

https://www.thetimes.co.uk/article/the-times-view-on-starmers-pension-glass-house-lq2qj3jk9

I think “bashing the rich” isn’t helpful because it distracts from legitimate concerns about tax rates and inequality in this country.

Rishi Sunak is taking advantage of the UK’s tax laws - we all would if we could. Hell, he even voted for one change that benefitted him.

But we need a serious conversation about the impact of inequality (having massive wealth at one end does not benefit the economy as we can see) and the redistributive power of tax. And we need to challenge the flawed assumptions around tax and investment. When we’ve had the lowest levels of corporation tax, it did not result in higher business investment.

By concentrating only on Rishi Sunak, it is not helpful.

And that is why we need a proper conversation about inequality.

Equalised for the company, not the individual in receipt of said dividends in the case of Rishi Sunak.

not sure I get your point on VAT and how do you think companies “create wealth”, without tax funded infrastructure?

@Believeitornot if you want a wider debate about inequality you should start a new thread.