IMPORTANT tax information for SAHMs and SAHDs or any couple with very different income levels

[fairertaxesnow]

Did you know that in most western countries, couples and families are given the option to be taxed on their COMBINED income, instead of being taxed individually? The reason for this is because it is MUCH FAIRER!

In the UK, taxes are relatively low for individuals, but they do not take into account how many people depend on that income. So a single man/woman with no dependants who spends all their money on themselves pays the same exact amount of taxes than a dad/mom with several children and a partner/spouse who stays at home because childcare is too expensive (or because it is best for young children, as research has demonstrated, or even if it's not their choice to stay at home but they can't find a job!)

Yes, there is (a pretty small) child benefit but this is capped/eliminated depending on the income level, and with only one parent earning money, the family will loose most of the benefit at relatively low income levels.

How is that fair!? This country needs to support families just like the rest of the western countries and not punish single earner families with a parent at home or working part time by placing the highest tax burden on them. Ultimately this affects the children, who are the future!

The child benefit charge is also very unfair, as many people have observed, because single earner families will start loosing their benefit at much lower household income (£50k) than double-earner families (they could earn up to £100k and have full benefits!)

Please sign the following petition to ask our government to modify the tax system to allow families to be taxed on their combined household income, just as most other countries have been doing for decades:

petition.parliament.uk/petitions/216429

Also, please share it with as many people as you can! The government will only respond if we reach 10,000 signatures!

More info:
www.telegraph.co.uk/women/mother-tongue/8365211/Britain-worst-place-for-tax-burden-on-single-earner-families.html
www.theguardian.com/commentisfree/2017/jul/11/single-income-families-inequality-workers-fathers-earnings

bump

Thank you to those who have signed already!

Good morning bump!

Why have you posted this twice under two different accounts??

What do you mean? I didn't post this under two different accounts, I posted a new thread under the same account when I saw that this one was not getting any views.

I don’t see why child free people should pay more tax purely because others have chosen to have children? If you earn your money, then it is yours to spend as you wish, whether that is on children or cats.

I do agree the child benefit should be based on household income, not the highest earner. I don’t think 50k is a “low income” for a family either.

Currently there is a benefit where you can transfer the lower earner’s tax allowance to the higher partner.

So i don’t quite get the point of your petition? Except that is sounds very much like “we have children therefore they should take money off people who don’t to pay for the kids we chose to have”...

Thanks for your reply. Our society needs children. Children are the future and in twenty years, they will be the ones paying the taxes that will keep the NHS, pension and benefits system and the country in general running.

Therefore, even individuals who choose not to have chidren benefit enormously from other peoples children.

The aging population is a well known problem and it is therefore very short sighted to place the highest tax burden on families and make it unaffordable to have children.

In London, £50k is a low income for a family. You can barely pay rent and food with that.

Regarding transfering the tax allowance, you cannot transfer the full allowance, only a meager £1000 which doesn't have a significant impact.

Women fought for years for separate taxation
I am not in favour of family taxation although there have been times when it would have been financially beneficial for us

I feel women were completely conned by the government when the tax system was revised. It went from women being mandatorily included in their husbands tax return, which is clearly wrong, to completely independent taxing in which many women actually lost out.

What they should have done is the same as the US, Spain and others, where couples are given the option of being taxed individially OR as a couple. The system is made very fair by having a different tax allowance and tax brackets for the combined income versus individual incomes. For example, the tax free allowance for a couple is not double that of an individual, but about one and a half. Families are more protected and nobody loses out because you can choose how you want to be taxed. Single people don't complain in those countries that families are given too many tax breaks

It is weird that we’re (I think) the only country in the G20 where your tax allowance doesn’t increase for your number of dependants. In the past child benefit made up for that to some extent but now that’s restricted at the top end.

The answer to all of this is for everyone to do a tax return. To have a system where you opt for one system of taxation or another, you would have to have a form. Think about it logistically. How would it work. Who consents to combined taxation? Both individuals? How do they opt out again? What about if a woman wants to leave her husband? Another form to separate their finances. What if he doesn't agree? What if they separate mid tax year? Will they have to do two tax returns each that year on top of official forms to separate?

If you want to do this, by all means make everyone over 18 do an annual tax return. Make every benefit means tested so the system is 'fairest.' Not fair as it will never be fair. But no government would ever do that. Many people struggle to understand really basic forms and couldn't do their own tax return. So as usual any system like that would disadvantage the poorest and least educated who wouldn't understand the various options. While its a good idea in principle you would need a generation of people educated in schools to this before you started it.

The only people who would benefit significantly out of this would be solicitors and accountants. And they have plenty enough business already.

The OP’s suggestion wouldn’t require everyone to fill in tax returns spring. You’d default to individual taxation and tax on that assumption. People who want to be taxed as a couple would opt in to that method and they would have to fill in tax returns. Similar to the existing married tax allowance.

Thanks for pointing that out @EventNotInData.
I'd also add that many governments require all individuals (with income) to do their tax return every year! Spain, the US and Austria for a fact! It can be pretty straightforward. In Austria I believe they have an online system that you sign into, and it has a prefilled tax return with the information they already have. You just need to check that it is correct or add any missing information, and you can then make choices if there are any and it's all very straightforward so most people never need an accountant or tax adviser.

People who want to be taxed as a couple would opt in to that method and they would have to fill in tax returns.

What if one spouse wants joint taxation and the other doesn't? What if one spouse doesn't want the other to know about their income etc?

I remember the old system very well, as I am old enough to have been working preparing tax returns and giving tax advice before the changes so understand the old system of joint and the option for independent taxation. For many, it was fine, for some, it was a logistical nightmare, and it added to costs as we were forever doing "what if" calculations on both bases. Given tax is now infinitely more complicated due to all the faffing around over the past 20 years, doing comparisons for everyone would be ridiculously time consuming and expensive for taxpayers.

What we need is a far simpler tax system for everyone, not even more complexity.

I'd also add that many governments require all individuals (with income) to do their tax return every year!

They have simpler tax systems and a "fit for purpose" tax administration. We've the most complicated tax system in the world and HMRC is home to incompetent baffoons who couldn't run a piss up in a brewery.

"What if one spouse wants joint taxation and the other doesn't? What if one spouse doesn't want the other to know about their income etc?"

I'm sorry, but how is this relevant?? In a healthy normal relationship, people don't hide income and they come to an agreement on their finances. If they are hiding income from each other or cannot agree on such matters, then they probably shouldn't be together!

It is not the government's task to design the taxes so that couples don't have any options just in case they would disagree over them!!

I'm sorry, but how is this relevant?? In a healthy normal relationship, people don't hide income and they come to an agreement on their finances. If they are hiding income from each other or cannot agree on such matters, then they probably shouldn't be together!

So you're the "relationship police" now are you? It's not for others to dictate what goes on in a marriage. There are already problems with the child benefit withdrawal rules where the two parents won't tell each other their income so neither knows if they're the higher earner hence liable to repay it through their tax return. There are so many people this affects that HMRC have come up with a "fudge" where each partner can ask HMRC whether they're the higher earner. Married couples have had separate finances for decades and will continue to do so for decades more. There's nothing in marriage laws requiring each spouse to tell each other everything. The whole ethos of separate taxation, which huge amounts of married women wanted and campaigned for, was so that they didn't have to tell their husbands everything.

"So you're the "relationship police" now are you? "
Watch your patronizing tone there. I am just repeating what relationship psychologists advise. I don't care what goes on on people's marriages if they are happy that way but again, it is not the government's job to avoid giving people options just in case they disagree over them. And having the option of separate taxation should have never lead to unfair taxing of families. The option to be taxed on the combined income should have remained. In my opinion women were conned when the tax system was revised. Yes, they got separate taxation, but at the cost of paying much higher taxes in many circumstances, including when one spouse has to stay home or when one earns more than the other

By the way thank you so much for those who have signed!

I agree with household taxation as a fairer system. I don't believe it is only for SAHP but for any household where one earns a lot less or wants to/needs to stay at home.

My DH earns much, much less than I do, so we would benefit from joint taxation. However, I don't support that system because I think it encourages women to stay at home and many of them then get trapped.

As a feminist, I'm very much in favour of individual taxation and women maintaining their financial independence. I don't think joint taxation supports that at all.

Thanks @AHobbyaweek.

And also thanks for your opinion @Brokenbiscuit, I am trying very hard to understand this idea that compulsory separate taxation is good for women but I am afraid that I still don't see it. Having the option of joint taxation wouldn't encourage women to stay home! It would just not punish it as it does now. And by the way this would apply if the husband stays instead, it would be completely equal for both sexes.

And to me it is misguided feminism to demand compulsory individual taxation because the effect has been to hurt the family finances and discourage having children.

Unless women stop having children, feminism shouldn't mean treat men and women the exact same way no matter what, but treat men and women in a way that is fair and supports the differences that they do have (because biologically speaking we are different and men cannot have children)

So this is all about the children ?

Can separated or divorced parents use it? After all many of the same rationale will apply...

And can you provide links to your rather inflammatory statement around the impact of childcare?

But no. I'll not be signing your petition. Independent taxation is right and indeed fair.
I couldn't give a shiny shit what other countries do.

Having the option of joint taxation wouldn't encourage women to stay home!

In some cases, it might well put pressure on women to stay at home, and I could not support that personally.

Separate taxation was hard fought for
and only the supremely arrogant would want it removed

read the history, not some petition