There’s NO point earning over £50k?!

[ThisReallyDoesntAddUp]

Because of the £50k child benefit limit and 40% tax rate!

So I earn £78,000 pro rata overall now with my job following a mid year pay rise. This includes bonus and car allowance. I work 4 days a week (80% equivalent) which brings the overall pay this year down to just shy of £50k with a £9.6k bonus.

Out of the £9.6K bonus due in March, I’ve worked out 40% will go to the taxman, over £2K will need paying back for child benefit as I’m now over the £50k threshold, and a further £800ish will go towards my student loan. Deductions of just under £6k!!! This means I’ll only take home 30% of my bonus?!

I’m now on mat leave for baby number 3. AIBU to make sure when I go back I remain under the £50k mark by reducing hours even further?! I’d then have less to pay in childcare mitigating the difference in the pay I’d receive working an extra day each week.

Its an absolute joke, I was hoping to go back to work after my last baby and push on hard with my career but what is the actual point!! I may as well work less hours, keep the child benefit and pay less in childcare!

I should think the Uk is one of the few western countries that does not offer child benefit for all or a tax concession for raising children.

Yep, it should just be universal

I earn over 50k but reduced my hours slightly so I can still claim my child benefit as I would be worse off by taking that little bit extra and losing CB. I am a single parent, have a mortgage and bills to pay and 50k doesn't go as far as you think when you have to pay for everything on your own.

Maybe if the government hadn't created the cliff edges of marginal tax rates up at 60% people would be less inclined to put more in their pensions. Thread after thread on here about it.

Maybe if we didn't have such a big liability around unfunded public sector pensions which way outstrip the private ones then we'd have more in pot for other services.

Btw you can see this same narrative about "why should rich people get state pensions" etc coming along the same lines.

It is very effective because it amounts to "you pay in and get nothing, others pay nothing and get benefits". Because that is the financial reality.

What you want to do is incentivise higher rate taxpayers to be more productive. You want them to earn more to contribute to public services and the welfare state. If you drift towards an American system where public services are really only for the poorest then there is no buy in from those who earn the most. And you need them to pay up!

I have a few friends just the same. One of mine happily admits she had more money when she was single with two kids. She's married now, her husband makes £70k, she's also working pt. She said she had enough money to buy new clothes and go out drinking whenever she wanted, because every single thing was paid for. Also, her ex didn't have money, so she wasn't receiving anything great maintenance wise. There's definitely a reason so many make the choice to live of the tax payer. My mum was worse off from working full time for many years, but wanted me to be proud of her and see her working, I'm so happy she did xx

I don’t dispute that higher earners should pay more, what I dispute is that 50k is a high earner in this day and age. Maybe 18 months ago I would say we felt fine but now, nope.

With the cost of living, a mortgage increase of £400, huge bill increases,childcare/school meal costs etc we are by no means well off or rich. For context I drive a 2014 car with warning lights and live in a fixer upper house in the north I’ve never been able to afford to fix.

Get a better paid job is probably a good shout, loosing another outstanding teacher in the education system though.

I could send one of my children away but that’s more on the state then…

It's true that after tax and ni higher earners don't come out with as much as you'd expect but I'd still love 50k sadly me and dp only get 34k between us due to circumstances. I've never seen anybody on mumsnet on such a poor salary so it does make me think how people are not managing on salaries of 50k plus

@ThisReallyDoesntAddUp would job share be an option? That way you don’t have to take your foot off the gas career wise, but can still work the a 2.5-3 day week you’re looking for.

@Poniesandpigs@Tevion1213 Yup, more than 1/5 people - nearly 1/4 actually - earn over £50k so it's not really a "high" salary, thanks to rampant inflation.

Does anyone know how much you can earn and still get 100% CB. Is it £50k (gross minus pension)

Example = salary is £57k pension paid 4k. A further 3k salary needs to be paid into pension pot to be entitled to 100% CB.

If you work where you get a 'one off' bonus that would all need to go into pension too?

But that means 75-80% of people earn less than £50k!

The sentiment of a lot of people who don't earn what some consider a high wage buts it's not really

Thank you SO much for taking the time to write this, I really was panicking - you're right, I'd completely misunderstood, I stayed up until 1am googling it and still didn't find anything that explained it all as clearly as you just did. Seriously, thank you!

In my case I'll earn just above the threshold, which is annoying in terms of the child benefit but as you say I won't actually be worse off, which is what I was worrying about. I won't keep as much salary as I would have liked but in my particular case I'm just happy to have a steady income, so I'm not too upset - it's more than I would ever normally earn so it won't make a huge difference to my expectations that I can't keep it all.

Now I understand the system properly I actually am not convinced that the system is so unfair - it doesn't seem to be true that there's no point earning over 50k, you still have more money, it's just that you have to work harder or more hours for less extra on top. But having an entire take home salary of 80% (excluding loan repayments) up to 50k doesn't seem that bad.

I think the poster you were quoting is misplacing their anger. But you're bang out of order to suggest that earnings are directly linked to work ethic. You think that Rishi Sunak or Boris fucking Johnson work harder than a single mother with two SEND kids who can't be in two places at once and has lost her career? Or someone with a disability that has impacted their earnings potential? Or someone with caring responsibilities? Or any number of other circumstances that mean people are stuck in low wage jobs.

God, will people stop this?

I am a lone parent. I am disabled. I have two disabled children. I earn over £100k and get hammered by this tax cliff-edge. And no, it won't go away when they're older because they can't do holiday clubs or group childcare so I have to pay private nannies and will continue to have to do so at least until they finish primary school, meaning a childcare bill as high as most people have for children in nursery. Housing costs where I need to live for work are £2,500 per month for a modest family home. Therefore, we are broke after housing and childcare. And yet if I increase my earnings to fund what they need, I will be taxed 91% on it (60% income tax, 2% NI, 9% student loan, 20% loss of "tax free" childcare).

A single parent with two children has to earn over £150k to be left with the same net income as a couple both earning the average UK salary of £37k, after tax and childcare.

It should be obvious this is ridiculously discriminatory and unfair to individuals, but also that it is damaging to the economy. And clearly I'm not going to sacrifice even more time ans energy and health on working more/ taking on more stressful roles and getting even less time with my children to keep 9% of the extra money I earn.

And as for this deterministic nonsense, I can't even...

My childhood was appalling and abusive. My school was one of the worst in the country.

Always these excuses from people to justifiy their hatred of people who have studied and worked extremely long hours to establish well-paid careers, many of whom are from equally hard or even harder circumstances than them. Instead it is bite the hand that feeds you, you should be bloody grateful to work for 9% of what you earn! And no gratitude whatsoever to the people who are funding everything for everyone else, over 50% of whom don't even cover their own costs to society in services.

And people wonder why UK productivity is so low.

But that means 75-80% of people earn less than £50k!

Well, we know that. In many cases it's because they are pensioners, or students. But in many cases it's because they choose to work part time and let the rest of us "top them up". Or not work at all, but still expect to be able to access all services paid for by taxpayers. Then have a go at the people funding them when they object to marginal tax rates of 70- over 100%.

No wonder more higher earners are leaving the UK every year.

And this!! I agree, it's pathetic. 🙄

Yes, it does sound frustrating and if your motivation for working is the extra money then it's natural not to feel motivated when you're not seeing higher returns for the additional hours.

However, the comments (not the OP) pretending people with lower pay don't work as hard (or harder in some cases) or couldn't manage to do the same job are offensive and unacceptable. Yes — some well-paid jobs involve astrophysics phds, but many are civil service or managerial or a multitude of other jobs that most of us could do given the circumstances, opportunities and experience, so, even if the OP's job is highly skilled and difficult, it's not ok to generalise.

No, the benefits poor people receive are often paid for out of the NIC they paid in- many benefits are contribution based on what you have paid in.

Business and employers pay in NIC as well which funds out of work or furlough or low pay benefits as well for poor people.

In addition, poor people also pay taxes that then fund their benefits when they fall below the threshold.

Most of what high earners pay in taxes goes toward public services which they benefit from as much as any poor person- pensions for the elderly, NHS, police, fire service, roads/infrastructure, schools, utilities, transport, etc.

So many economically illiterate posts on here. Over 50% of the population don't pay anything close to covering their own costs. The asset wealthy pay very little as a percentage and higher earners on PAYE/ in the professions are being taxed to obliteration with some of the highest marginal tax rates in the world, which in many countries would be illegal because those with higher incomes pay less as a percentage.

These people have been subsidising everyone else for years and have been milked to the extent that they are cutting their hours and declining promotions. Economic studies have demonstrated this. This makes everyone poorer and means lower overall tax revenues. And meanwhile they are being excluded from accessing what should be universal services like childcare, despite them funding it for everyone else.

If you want the decent public services as you see in many countries e.g. elsewhere in Europe, the difference is that their low and middle income earners pay far higher tax rates. There is no other way to fund it: it's mathematically impossible.

Meanwhile the wealthy (clue: these people mostly aren't employees as they do not have to work for money - although some exceptions like our Prime Minister choose to do so on a short-term basis as a stepping stone to further his network and business opportunities) also should pay a lot more. But that won't fix the problem because even if they did, due to their numbers it wouldn't raise enough.

Perhaps study some economics and maths and look at the data before making such foolish and demonstrably false comments in future.

But as I've pointed out, many have achieved such things from difficult circumstances. Why do these bitter people not go and seek the opportunities and do the hard work to get the experience if they believe they are sufficiently skilled to do it? Or, if they do not have the skills or are too lazy to do it then they should be grateful to those that do and therefore subsidise their lives through tax, or at least shut the hell up with their "tiny violin" sarcastic bullshit, or their woe is me excuses.

I'm sure all such comments really make the higher earners here even more inclined to sacrifice yet more time with their children to go out and work harder so they can hand over the vast majority of their additional earnings from this extra work to fund such people even more.

I have been considering for some time cutting my hours as the marginal benefit in net income decreases the more hours I work. I had sat on the fence about this for many reasons (including that I've happily paid a lot more in tax than I ever used in services, as I think that is reasonable on a higher income).

However, with the ever rising taxes, the enormous discrimination in the tax system against single parents (almost all women, so what a surprise), and then finding that the services I was supposedly paying for do not exist when my disabled children need them: state education is a joke and has treated them appallingly due to their disabilities, absolutely vile behaviour from their school. The NHS may as well not exist and I've had to fund all of their treatments and operations privately, etc. I have had enough. I am not a cow and will no longer be milked.

Then I've been reading this thread and the disgustingly ungrateful comments about people like me, who worked 80-90 hour weeks all through our 20s and early 30s before having children, took exams that most posters here wouldn't have a hope in hell of passing, then are told we are "privileged" and "lucky" to pay 91% taxes and anyone could do what I have done. And I did all this while disabled myself. You know what? Fuck them.

This thread has tipped the balance for me, when I'd been trying to make a decision for a while. I shall be cutting to part time, so goodbye to another chunk of the tax revenue funding all of these ungrateful people outraged at the people who fund what they take for granted. I shall hugely decrease the extent to which I do so now and will spend some more time with my children instead.

And this is happening across the economy. Carry on with the bile though, and enjoy getting increasingly poorer as a result. 😘

I think that to some extent you can argue this both ways.

If we take out people who are really unable to work for whatever reason, if we notionally took away all state benefits and tax advantages from working people, what we'd see is a situation in which employers would have to pay the real value of people's work in order to get workers.

Would that be better for workers? I don't know, but I think in some way it creates a more honest set of choices about things like, should I work more, or spend more time caring for kids when they are young. In reality whatever benefits the state gives to encourage both parents in o work, that choice will still present itself at some point, like the OPs case. And maybe its's better to leave it to the parents to make that calculation which will be about not just the money but also the kids and quality if life for the family, rather than having the state try and push what it thinks is best which will always be about the money.

More importantly I think it's much better if employers are on the hook for the real costs of workers.

I di think some kinds of benefits are probably worthwhile - the idea that it is logical for society as a whole to contribute to caring for kids is perhaps a good example of that kind of thing.

But I'm just not sure that creating solidarity by having the state administer universal monetary benefits to the population at large is ever going to get away from creating weird artificiality. And in any case at a certain income level people must realize that while they may be receiving the benefit but they are also paying for it, for themselves and others as well.

Yeah right.

Where are you paying 60% tax @FreeZor? It’s not in the UK where the top rate’s 45%. I’d also query how it can possibly be that a family with three people with disabilities could pay more in tax than they take out. There are numerous non means tested benefits available to people with disabilities, why aren’t you claiming them?

Then there’s this

But that means 75-80% of people earn less than £50k!

Well, we know that. In many cases it's because they are pensioners, or students.

You do know that only working people are included in those stats? No statistician, no matter how amateur, is going to skew their results by including the non working population. And you have the bare faced audacity to call others economically illiterate.

@TempestTost - I don't disagree that subsidy of wages has to end. The current arrangements are mad. Part time work being subsidized by government policy also has to end. These are policies we can't afford long term.

I am all for certain laws being reviewed like anti union provisions, zero hours and policies like EMA being reintroduced.

But the idea the UK government should be subsidizing wages and facilitating part time working arrangements is mad. It shouldn't. Socialism for employers. A hot mess. And very expensive, and discentivizes work.