Child benefit should be removed from households with £60k income

[LowLevelGrumpMostly]

I don’t get why the government doesn’t allow a single parent on £60k to claim - isn’t allowed child benefit but a couple on £99.9k is, where the couple is likely to have lower childcare costs. So much money could be released for other stuff - if a single mum on £60k doesn’t need CB why should a couple on more get it?

In the examples of UBI I've seen all income gets taxed.
And the minute you start making any exemptions and give people more you add in a layer of complexity that means it costs as much as any other system.

@mumda well yes. That’s what I said.

This doesn't make sense to me because my husband suddenly started getting letters about having to pay it back when he started earning over £50k. He's never made a claim... it's me who was making the claim so HMRC must have known we were a "household"'somehow?

It's incredibly unfair. My DH earns near £60k and I haven't earned more than the tax threshold for tax in 7 years.

@mumda oh wait I see your confusion, the first paragraph was supposed to be a reply to someone suggesting per-child tax allowances but I forgot to tag them.

Yes, UBI to actually work should be flat (with the exception of disability). And earned income taxed at a flat rate with no allowances as the UBI itself effectively replaces all allowances and benefits.

Unfortunately the numbers don’t really work unless governments get serious about taxing corporations.

Cheapest way to implement this is to just give it for all children.

Any cap/threshold takes so much work to implement and maintain that you don't end up saving anything at all.

It was just a votes winner to appease people, didn't actually result in any benefit to the balance book at all.

Child benefit is linked to an individual parent (for very good historical reasons) which I don't think makes sense anyway when UC is household and so many children live in co-parenting arrangements with more than one household. It needs totally changing, but that's difficult, expensive and will be a vote loser most probably.

So many people have had a payrise in the last 2 years & are now earning over the threshold for the first time. The admin required to process all the additional tax returns and issue repayment plans will be huge - perfect time to review it but no

It was a bonkers change in the first place.

It’s really awful. I’m a single parent to 3 kids and don’t get it because I’m just above the limit. I get no help at all from my children’s dad. But, a couple on almost double what I earn will do🤷‍♀️

they manage to do household income for UC and other benfits

I don't know what benefits low income families have other tban CB but wouldn't it be better to scrap CB and increase benefits for those that need them?

No one earning well should have government benefits.

It would be unfortunate to scrap CB without putting in place another mechanism for NI credits for a parent/carer (until youngest DC is 11) and for the records of nigh on all the DC in the country from which their NI numbers are issued age 16.

Bang on the money. Totally agree.

There once was a time when the focus was on growth and improving everybody's lives.

During this process the poor might get 10% wealthier and the more affluent 20% wealthier. But rather than accepting this the left and the socialists start getting upset and say that is unfair.

So the focus moves away from growth and instead being on redistribution. I don't think the tax people at the govt will allow any policy through unless its redistributive. Been like this for years. If we have a Tory or Labour Govt it makes very little difference, after all there is a finite amount of money.

So what are we left with? Well no growth means we all get poorer.

Below is Margaret Thatchers last speech in the commons. If we had somebody with even 50% of her ability around these days things would be a lot better.

r

Growth is a good point.

The marginal tax rate between £50k and £60k can be so high that it disincentives taking on extra work. And a lot of people are now being pulled into this dilemma given the thresholds haven't risen with inflation.

I agree. It should be based on household income.

The marginal rate's at some steps in the tax system are awful.

A friend of mine years ago was on £50k-£60k and has 2 kids and worked out a rate something like 50 something percent. I think if he had 4 kids it would have been over 70%. As such people take salary sacrifices or ask to work 4 days a week to get them down below the threshold. As for somone around this level being promoted, why bother? You get all the extra hassle and stress for little money. This does the country no good at all.

In my friends case he got a lifetime membership for himself and family to the National Trust, it counted as a charitable donation and took him back below £50k.

I read the other day high earning English university graduates on £100k-£125k with student loan payback living in Scotland could face a marginal rate of tax of 84.5% or thereabouts.

When the britightest and the best we're taxed to death in the 1970's many left the country, never to return which made the country poorer.

Scotland in particular is the current poster boy of how "no to do it" but they appear hellbent on destroying everything.

https://www.spectator.co.uk/article/scotland-pioneers-the-84-5-per-cent-tax-rate/

We're in an era where there are labour shortages and a massive number of vacancies. But with the tax system setup as it is this comes as no surprise.

This is from 2015.

If a low earner as in this example was even taxed at a high marginal tax rate of 40% (which I believe is far too high) at least there would be some incentive to work, progress, and make a better life for themselves. Instead they are trapped. Millions are.

https://policyinpractice.co.uk/93-tax-effective-tax-rates-explained/