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!

You do realise there is a two child cap?

The tax thresholds haven't kept up with inflation - and that affects people on min wage right up to people on six figures. The standard personal allowance needs to increase with a corresponding increase to higher and additional rate thresholds, and the threshold for child benefit/childcare.

Can you not ask for your pension to be paid in April if you earnings will be lower next year due to mat leaves.

WingsofRain

I’ve worked hard all my life and currently get £12k a year. I’ll swap for your £70k+ if you like.
Or even the £50k, actually. 👍🏻
My friend was on min wage for twenty years and then started working in a call centre company. Worked her way up and is now only two years on (high turnover as is a tough job) on a managers job of over 50k (euro). I have another friend who went back to college at night in his 40s and is working in IT and earning so much more. If there’s any chance of you moving up or upskilling then honestly consider it x

Exactly.

Unfortunately, much discussion on here gets bogged down by people who can't see past whether they sympathise with the people facing the particular bottleneck being discussed. Very short sighted.

Yeah you're right, it's a really shit thing for you to say.

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.

Taxes under the Tory government are far too high. Britain is broken. You could consider voting at the next election for a party who is promising to raise the income tax threshold to 20K (so that anyone on minimum wage pays no tax) and for a party which is promising that the higher tax rate would not start until your income exceeds 70k.

Been reading through this thread. I've been worried about possibly having to pay back child benefit as have just received a bonus which will take my total gross annual earnings to £52K. Reading with interest about pension. So am I understanding correctly that if I have already contributed a percentage of my salary each month into my work pension then the total amount I contributed would come off the £52K figure for the purpose of still being eligible for the full child benefit?

Not for this year I believe as by end of tax year I’ll be on 55 and I’ve now learnt I am prob close to 50k net adjusted . Next year yes not eligible if stay with same hours

This is part of the reason British productivity is so low. The system discourages people from working so they don’t cross the 50k or 100k barrier. It’s nuts!!

In many cases, earnings are directly linked to work ethic. There would have to be a heck of a lot of single mothers, people with disabilities and carers for them to be the rule rather than the exception. I am very open to reading any evidence that indicates otherwise.

I would hope that the single mother, person with a disability or carer would be grateful that those people who do work hard and earn a lot of money pay tax to support them. It makes absolutely no sense to tell the taxpayers supporting them that they should be grateful and are not entitled to complain about an unfair system.

And for every single mother, person with a disability or carer, there is someone who happily sits on their arse and does nothing to advance their careers.

Personally I find the suggestion that society owes you a debt of gratitude for being so wealthy rather disgusting, but we’re all different aren’t we.

You are absolutely right. Our bonkers tax and benefits system discourages work. It needs totally overhauling to make it simpler and just. It’s not as if the present system provides us with world class public services. We are in a mess.

So never worked full time then, v v young? if you're 23 or older, and currently working 35 hours a week, your annual salary must be at least £18,964

Where do you think the vast bulk of our taxes come from? It’s not the poor, or those on benefits.

I may not like Rishi Sunak or his politics but I would never suggest that he doesn’t work
hard. I doubt he gets more than a few hours of sleep a night and yet is paid less than some 24 year old trainee lawyers in the City. Not to begrudge the trainee lawyers their pay as they do work incredibly hard too but it seems crazy to me that the Prime Minister is paid comparatively so little.

Rishi Sunak obviously married well and has a lot of investments that he pays capital gains or corporation tax on. The proportion of tax is low when compared to income tax but the actual amount he pays in tax is likely more than you or I are will earn in a lifetime.

Can’t believe the comments on here about privilege.

Why should she work more time and spend more time away from her babies if there’s no financial incentive.

There woukd be non financial incentives to any business person or wealth person being PM - networking being just one.

People want everything for free- healthcare, education etc for three kids, but they never want to pay the taxes to pay for it.

I would hope that the single mother, person with a disability or carer would be grateful that those people who do work hard and earn a lot of money pay tax to support them

Many single parents, disabled people and carers still pay tax and/or paid tax before their circumstances changed.

Unpaid carers save the taxpayer far, far more than what is paid to them via Carer's Allowance.

Are you mad ? People with wealth have family trusts, companies, money overseas, assets at a “loss” and astute accountants working this all out. They are winning.

109% agree. Everyone should find ways to utilise the system to their advantage, and if I were OP I wouldn't be working more hours to pay extra into a system that is not going to reward me for it......who would?!

Why are you bashing OP for having a good career? You don’t know how many years of studies she put in to ensure she secured herself
a good job - I don’t think that’s for you to take that away from her?

😂😂

Right, so the fact that wealth inequality in this country has reached a point where the top 1% in the UK pay nearly a third of all income tax … is a reason for everyone else to bow and scrape in gratitude?!

Dear lord, no wonder this county is in a mess, the feudal mindset is alive and well.

I agree, the incentives to earn more start to reduce once you become a higher rate tax payer, and the cliff edges produce skewed incentives. Problem is that the welfare state (which includes child benefit) is getting ever larger and needs to be paid for somehow, and since neither of the main parties seems to have a clue how to grow the economy, they will have no choice but to continue to raise taxes or reduce public expenditure.