little bit of fun...tax calculator

[breadandbutterfly]

Much discussion on here often seems to stem from those on the right objecting to paying through their taxes to support those earning less, whilst those on the left argue that the rich should contribute more.

Interesting calculator here:

www.bbc.co.uk/news/uk-politics-13633966

which shows on average what someone of your family size and earnings pays in taxes but also how much of that you get back in benefits of one kind or another (eg paying for school-aged kids' cost of schooling etc).

Much to my surprise, as a leftie, I discovered that we actually get back over 5 grand less than we contribute - can't say this changes my politics one little bit, as I'm happy that my 5 grand plus goes to contribute to society as a whole and those who really need it (though slightly messing up the theories of those who believe that only those who benefit from redistributive taxation could possibly favour it :) ).

Interested to see if any right-wingers on here would like to try it - wonder how they will cope if they discover they're actually being net supported by other taxpayers, rather than the reverse!

Go on - have a go - quite fun. :)

Interesting. Doesn't really work for us as it assumes you claim benefits if you are on a low income but we don't. We fell where I thought though. Paying in less than we get out.

I don't think the calculator is accurate. Entering the details including one school-age child it calculated that my entire annual income-tax payment gets me nothing in return. If I removed my school-age child it calculated that I was contributing double!!! i.e. everything I pay in tax, NI and still some more on top. Can't be right.

Is it including the cost of educating your child, maybe?

It doesn't tell me anything I didn't know; we pay in quite a lot more than we get back (at least directly). I have no problem with this.

Yes, I assumed it included the cost of educating your child too.

It's only accounting for your current situation, though. We are paying in quite a lot less :( But hopefully that will change over the next few years. I'm jobhunting at the moment and it's nuts - I literally can't afford to take a Christmas temp job because none of them are offering 16 hour + contracts. So we end up worse off than we are now. Apparently they think you have some magical free childcare if you work less than 16 hours

Well according to that we are £27k+ per year down! Good job I wasn't looking to be cheered up!

Suspect there might be a glitch in it or I am an idiot who can't fill in forms

Well, it's just a fairly simple system that assigns you to an income decile based on your household income, and which seems to factor how many children you have into the calculation. it doesn't claim to be anything but vaguely indicative.

If you're in the 9th decile (second richest) you pay in c. £12.5k more than you get if you have kids, but that rises to c. £27k if you have no kids.

I clearly need more kids!

Or at least, that's what the calculator says. It's not taking into account anything much at all.

I just checked again and the £27k figure arises because it shifts you onto the 10th decile if you have a household income of c. £75k and no kids. You go into the 9th decile with the same income and kids.

However, that makes little sense, as you wouldn't be paying any more tax and you certainly don't get £15k a year in child benefit.

Ah, wait. The £15k is the extra services (healthcare, education, etc) that you'd get with kids on average.

Hmm, we'd get pushed into the 4th decile though if I was to find a part time job, which is encouraging. And the 5th if I was working full time.

It's interesting that only the top 30% are paying in more than they are getting out. I wonder how that relates to the Rowntree cycles of poverty thing.

If you give a £75k household 4 children, then they go into the 8th decile and only contribute c. £5k. With 6 children they go down to the 7th decile and with 8 children they're in the 6th decile and net gainers (to the tune of c.£2.5k). With 18 kids they're presumably down in the 1st decile.

Actually, they'd need 22 children all in FT education to make the first Centile on that income.

I did this earlier. Apparently we are net contributors, which didn't surprise me. Fine by me, as some people will always have to pay in more than they take out, or else the whole system would implode. At the moment, we can happily afford to put money into the pot, but we have the peace of mind of knowing that the safety net will be there for us if we ever need it.

Slightly amused, though, by the fact that I know a number of people in the benefit-bashing brigade who are almost certainly net beneficiaries if this calculator is correct - you know, the people who bang on about "our" tax money being handed out to feckless scroungers. I would like them to try this calculator!

I should think anyone with 22 children might have more to worry about than which decile they are in!

timidviper - how many kids do you have?! How can you be 27.5k down, unless you're earning a negative amount?

"the people who bang on about "our" tax money being handed out to feckless scroungers."

I think even those who benefit from the system e.g. taxpayers on lower than average pay, are still entitled to be disgruntled that there are some who appear to do nothing at all, contribute nothing at all and can enjoy what appears to be a similar standard of living to theirs. Whatever the truth may be, the perceived unfairness is real enough.

Very approx definitely, I have 2 in state & one in private education, I don't think the calculator is set up for that.
Also it has me down as paying 0 in NI -- that's not true, I am doing voluntary NI contribs.
I don't care, really, have no agenda either way.

Timid viper can be £27k down because she's in the 10th decile and people in that decile are, on average, net contributors to the tune of £27k.

The tenth decile is the one that's probably most likely to be way out though, as the top 10% of householders by income is likely to have far more variation than any of the other deciles. It would include a couple without children each earning under the HRT threshold (say £38k each) alongside household where one person earns multiple times what they do together. A single person on £1 million a year will be contributing far, far more in tax than the couple would be. Most of the people in the top decile will be contributing less than the £27k because those with very high incomes really pull the average upwards.

We become net contributors to the tune of £12.5k - however, this assumes that the services which are provided by the government are as cost effective as the services we would choose were we paying with our own money. I find this very difficult to believe, therefore, our (and everyone else's) contributions will be even greater.