Salary sacrifice to be taxed

[SomethingInTheAirToday]

https://x.com/politlcsuk/status/1986914552093745592?s=46

not only are my generation not going to have a state pension or private healthcare, but we also can’t save into our own pensions because we need to fund the current generation.

this makes me so angry

I know. I didn't make any comment about that.

It's tax free either way actually.

You can divide it up and use it as part of your income using flexible drawdown in a number of smaller payments. It's called Uncrystallised Funds Pension Lump Sum (UFPLS).

Where does this "classification" come from?

The Government re advice on it
and
Accountants that deal with and advice on that

Again in English?

Maybe a link?

My accountant sorted out mum's inheritance tax, she never once referred to it as "double taxation".

No, that is two different taxes being applied to the same money as it passes through different transactions.

That’s normal and obviously happens multiple times throughout the economy as money circulates.

Double taxation is where the same money has the same tax applied to it twice. E.g. if they were to remove/ restrict income tax relief from pension contributions AND tax that money with income tax again when it is withdrawn from the pension. That would be totally unacceptable and the equivalent of deciding the apply a new income tax to money withdrawn from ISAs even though income tax was already paid on that money before it was put in the ISA.

Yes: mathematics.

Exactly.

It’s very simple not sure why its confusing
Whilst IHT is on a persons estate it’s double taxation
If it’s swapped to a tax on the beneficiary it wouldnt be

Too much info to bother rifling through it for anyone here when I already understand it myself.

If anyone’s interested just Google.

That’s nonsense.

Who is paying inheritance tax twice on the same money?

Two different taxes being levied on the same money isn’t double taxation. If it was then paying VAT on anything you bought with money that had already been subject to income tax would be double taxation, or paying insurance premium tax on a policy you bought with money already subjected to income tax would be double taxation, or paying dividend tax or interest tax on money you had invested which had already been subjected to income tax when you earned the money would be double taxation.

These are different taxes being applied to separate transactions.

Inheritance tax is a bad tax for many reasons: it raises comparatively little, it creates perverse economic incentives, it is applied very unevenly with the largest estates paying next to nothing, there are good moral arguments against it also, and the method of implementation means that it causes a lot of unnecessary stress to inheritors in certain circumstances. However, it is not “double taxation”.

You said it was "classified as double taxation" - I'm just asking where that classification comes from. I don't need you to justify your opinion on it, I was hoping you were going to show me some credible source for your assertion.

Instead, I get word salad that doesn't make sense.

Clearly, you were just making stuff up.

It's worth noting this does NOT just affect the private sector. The University USS pensions also use salary sacrifice and this is going to have a very negative effect on our pensions. Honestly, if this goes through I will never vote labour again. Its appalling.

Agreed, it’s a shit policy entirely. OTOH, returns on money paid into db schemes are much higher, so it’ll impact the pension pot for those in the private sector dc schemes more severely.

Why the retirement wealth gap is about to get wider

www.thetimes.com/article/b9f6c9bd-5c53-4497-b749-0bc27c3c2745?shareToken=68ba40f1cc8872b04edc261d16d0fe93

Most USS pensions do not use salary sacrifice

Why do you think the labour party are for you?

Labour is for criminals, immigrants and benefits people.

Yes they do - which one doesn’t?

Any uni that doesn’t salary sacrifice its pensions, whether they’re USS or any other, needs a new CFO frankly. Who’d volunteer to pay more NI.

Thatcher made everyone selfish gits.

Yes!

I remember all that selling off uk assets and some people in my workplace all excited for their shares they were going to make loadsamoney from. All that tell Sid stuff.

Doesnt England have the only fully privatised water industry in the world? That went well.

We have marvellous public transport don’t we?

Public housing sold off cheap and not replaced (blame all successive governments for not having the foresight where that would end up and fix it). Even as a young person then I knew it was wrong. Both my parents grew up in council housing. But I suppose a few people make money from ridiculously high rents so it’s all good. Funded by taxpayers in housing benefit components.

Thatcher may have had conviction and strength, but her legacy gets worse as time goes on. And looking back, the first Blair government could have done something about the council housing policy but didn’t.

I’ve thought that for a long time. The evidence of Thatcher’s children is everywhere now. And the repercussions of her premiership keep echoing.

Whilst I agree, Labour came in 1997 and they didn't make any changes to the big policies that Thatcher made - they for example didn't stop "right to buy" which would have had large implications to the housing market and New Labour being voted in for another 2 terms

So whilst yes Thatcher made some.big changes which still affect us now, other governments haven't changed this for their own selfish gain.

I agree. I was very disappointed that the Blair/Brown governments didn’t get rid of right to buy and quite honestly I don’t see what was in it for them by keeping it because most Labour voters have always hated it. No incoming government could have corrected the worst of the damage because it was irreparable - deindustrialisation, pit closures, privatisation - there was no reversing those.

I wonder which Labour voters you knew? Know several Labour voters in south London who made life changing sums out of right to buy - Blair didn’t change it because it was a way of getting some people who’d never have had a chance on the property ladder.

rather than stop it, what they should’ve done is build more social housing - the story of house prices is all related to rising population and not sufficient stock.

and we’ve got a depressed construction industry and missing building targets…

Perhaps it wasn’t a popular policy amongst owner occupier Labour voters in North London etc but saying it wasn’t popular amongst Labour voters…

It wasn’t popular with the majority of Labour voters. There’s not much point in increasing the amount of social housing if it’s going to be sold off at a knock down price a few years down the line.

May have to agree to disagree on that one - it is certainly true with hindsight it’s unpopular given population increase driving housing shortages and private rental issues.