To think this epitomises the squeezed middle - HMRC shitiness

[lurchersforever]

So the weekend before Christmas I have received the joyous news that I have not paid enough tax this year so my personal allowance for the rest of the tax year will be adjusted so I can pay it. This will wipe out the pay rise I have just received (it was the teachers' 5.5% and the first 3 months were pretty much wiped out anyway as they were received in a lump sum in November so taxed more, so that what I received for 3 months was the same as I what I got for one month this month). Next month I'l get nothing as a result of the unpaid tax. I am due another pay rise next month as will start a promoted role so I'll see what that brings but it won't be much as not a huge step up this time.

Next month my mortgage will go up £100 as I've had to renew for the first time since the rates rose (it could be worse) and I also have to pay back pretty much all my child benefit from last year which, as a single parent with an ex who pays nothing (I am with CMS - he's low income but owns a house outright and has money for stuff he wants) stings a lot.

I did exam marking in November, which nearly killed me in terms of workload, and got £630, which is £100 less than the tax I owe so is essentially wiped out by that.

I'm so fed up. I earn a salary that I never thought I would and would have thought if I did it would be great, but disposable income isn't that different from what it was pre-Covid as a result of col etc, but, worse than that, every time I do get a bit extra it's taken away. Enormous increases in workload and stress for next to nothing in the end. What is actually the point in working yourself into the ground for it just to be taken?

I doubt it.

They do only pay 2% NI though.

Two much paid out in benefits which aren't taxed. That's the problem IMHO. How come you can get £2k a month plus in benefits but no tax. But if you actually earn that amount you are taxed fairly heavily. The system is skewed.

Some benefits are taxable.

https://www.litrg.org.uk/tax-nic/how-tax-collected/tax-state-benefits

Agree it's fucking shit op.

Charity worker here and honestly my mate who is a head of dept in a large London comp (so comparable level) earns £12k more than me a year and gets 3x the holiday.

On the higher part of the income, yes. That’s still almost half going on taxes, plus the loss of child benefit, personal allowance etc. For example, they have to earn over £4K gross to make up for no child benefit on 2 children.

I know several single mum's who know it is not worth working because their part time salary would stop childcare and benefits but not be more than benefits alone... It's forcing a lot of women out of work for a decade.

But the majority won’t get ‘taken’. If the extra amount you earn takes you into the higher tax bracket, you’ll pay 40% income tax on that amount. You can offset some of that by increasing the amount you pay into your pension - it means that you may not see an immediate benefit in your pay packet but will benefit when you retire.

Charities are well known not to pay well. You could change sector.

Sympathies.

i work in the NHS. We’ve just had our pay rise from April. It’s pushed me up to the next pension bracket which wipes most of it out. My genes aren’t great, there’s a good chance I won’t get to retirement age yet I’m not brave enough to opt out!! DH and the kids will benefit though….

You would be better off cleaning for cash or tutoring

So how long have you been teaching? NMW full time salary after deductions works out at around £1500 a month. I teach for 2 days a week on M6 and my net salary is over £1000 a month.

If the amount you owe is around £700 then for your whole 5.5% increase to be used up in a year you’d only be earning 14k?

You can ask that the repayments are extended over more than one year to reduce the financial impact.

Yep…the middle squeezed to Ill health by the last government and being squeezed to death by the lying toads that are Labour and Starmer who all lied through their teeth to get elected

Don't worry, the WASPI crowd will come along in a moment and tell you how hard done by they are.

I think a tax allowance for each child would be helpful. And for married people it could be shared between them.

I know several single mum's who know it is not worth working because their part time salary would stop childcare and benefits but not be more than benefits alone... It's forcing a lot of women out of work for a decade.

Nonsense, they’ll get 85% of childcare covered by Universal Credit and their benefits taper once they earn more than the AET which is around £800 per assessment period at a rate of 55p in the pound. They’d need to be earning a reasonably good salary part time to loose all benefits.

Back in the dark ages there was. My son was born in March and we got the entire year’s tax allowance back to the previous April - which was before he was conceived. There was no child benefit for the first child, though, so I guess one cancelled out the other.

If you’re a 40% tax payer then you get to keep 60% of any extra you earn.

Thats very different to nothing. If it’s come in lumps then that might not happen payment to payment but that’s the net effect for the year.

How long ago was that? They bought in tax credits mark 1 when my child was quite young, but I never got a post office book for child benefit, it was directly paid.

If we gave parents the possibility to earn an extra £5000 (finger in the wind guesstimate) per child then the tax allowance for a family of 2 would be
2x12,570 + 10000

£35,140 tax free.

It would be more than child benefit is worth - but that's given rather than allowing you to earn more (Of course CB currently stops for people over a certain amount)

Would it work if you said there wasn't a limit on the number of children ... it'd mean the bigger your family was the more you could earn without paying tax.

I think working parents is a good thing. But it's so horribly expensive we need to work out how to make it make sense for people.
I don't know what the full financial consequences are as I'm not sat with any stats or models of behaviour that might be encouraged by the change.

How long ago was that?

1975, but it was nowhere near as much as an additional personal allowance. We did get a useful tax rebate though.

That's a bit mean. This WASPI is fully aware that many young families are struggling financially (many of us do have children and grandchildren) and totally accept that it would be ridiculous to pay compensation across the board. It's very disheartening to read threads like this one and to realise how difficult and miserable life is for so many parents.

I realise it was meant spirited of me, I think the bitterness of a life of non stop working and seeing pay rises eaten up in tax while costs are rising is overriding any sense of reason at the moment.

pay rise I have just received (it was the teachers' 5.5% and the first 3 months were pretty much wiped out anyway as they were received in a lump sum in November so taxed more, so that what I received for 3 months was the same as I what I got for one month this month
got £630, which is £100 less than the tax I owe so is essentially wiped out by that
You've double counted the tax here, but you only paid one time. Appreciate you paid extra tax, but now you're in the relaxed portion where you earn more.
I'm self employed, so I like to prepay tax and hate always seeing yet more money due next July / January. Unfortunately, government has chosen inflation alongside stifling employment growth, so whatever the income we will all feel the reduction alongside the next few years. Your 5.5% aim is rebalancing salaries across industries by creating inflation (it wouldn't for just teachers but obviously every union has requested an increase at once); from macroeconomic theory this approach would never be expected to lead to you feeling an increase, it's more of a tidying exercise. Really you need to look to promotions and the extra work like exam marking to feel any benefit.

Support staff in our school was offered the option to take their payrise over 3 paycheques so as not to screw up any additional benefits they are receiving. Should have offered teachers the same option.

it’s unlikely a teacher will be receiving benefits though, spreading the payment won’t impact tax.