Young(er) people in professional jobs/doing lots of overtime/two jobs still living at home or in cheap accomodation, saving for a house for instance, could save a thousand pounds a month, as could old(er) people who have paid off their mortgage by one way or another. Neither would be necessarily 'upper middle class'.
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Bletchleyite
Veteran Member
I doubt it. A thousand pounds a month net is a lot of money. And if anyone is in that position, it's quite right that they be encouraged to invest in growing business or to pay tax on the interest (which is still only a very small sum). I think this is a financial version of the RailUK Standard Minority (the theoretical person with all 8 protected characteristics) who we've not seen posted about for a while.
Why, again, do we persist in defending the interests of the well-off (anyone who can save £1K a month is by definition well off, like it or not) with strawmen against the real "little guy" - the person on minimum wage struggling to keep their head above the water who we should really be supporting? The present political climate and the support the likes of Reform are being able to bring to the rich from people who aren't rich is utterly, utterly bizarre. See also rich Boomer pensioners being seen by many as scraping together their last pennies.
If you put £8000 into a cash account paying 4.5% you get £360 interest annually on which the standard rate tax would be £72. That extra tax is unlikely to stall the housing market.
My criticism of this change is that it doesn't really matter. What matters is the ability for people to put aside £20k every year, sheltering very large amounts from tax. I would put a lifetime limit on contributions, say £100k.
I don't get too hung up on disparities in wealth (the rich will always be with us) but I object to measures which add to them.
My criticism of this change is that it doesn't really matter. What matters is the ability for people to put aside £20k every year, sheltering very large amounts from tax. I would put a lifetime limit on contributions, say £100k.
I don't get too hung up on disparities in wealth (the rich will always be with us) but I object to measures which add to them.
If you are earning £3000 a month net, living at home or have paid off your mortgage and/or are living with a partner also earning, you could quite easily save a thousand pounds a month net. And not be in any way 'upper middle class' , as I would consider it anyway. I am not sure your 'class' has got anything to do with it.
There are lots of people in this position who are not 'upper middle class'. If you worked on a second hussle every weekend for a while and have a partner living with you doing the same, pay off your mortgage, I expect you could get there too! It is for you to decide whether the sacrifice now is worth it for future wealth, but if not don't expect those who do to want to help you in the future because you didn't.
I am defending the interests of the well-off (in your definition) maybe because I am one of them in a small way - I've worked hard (sometimes lots of overtime, sometimes a second hussle, often with lots of responsibility) and I don't just want my money earned and saved to be taken from us just because 'I can afford it', to help the people any more than strictly necessary who won't /didn't. Within reason of course.
I don't want to be encouraged to invest in Stocks and Shares - I was burnt many years ago by a Stock Market crash (probaly engineered by big financial / government interests). No thank you. Nor do I have any issue with paying tax on any interest earned above inflation rate.
Bletchleyite
Veteran Member
A well functioning housing market is key to a prosperous economy, but in the UK the housing market is dysfunctional and one of the main barriers to economic growth.
In particular a liquid housing market is important for job mobility, one of the best ways for people to improve their productivity is to be able to move to new and better paid jobs.
You are right that this is all economic activity.
But the UK housing market has key impediments to liquidity. One is tax, with continuing occupation of the same property undertaxed (council tax) and moving overtaxed (stamp duty). Another is planning law, which for decades has restricted supply. Building new houses generates a lot more economic activity than existing houses changing hands.
A consequence of planning law restricting supply is that interventions on the demand side mainly affect prices not activity, where the economy gets a "sugar rush" as buyers respond to demand side interventions, but this quickly disappears when sellers raise prices.
It is a splendid coincidence that this is interwoven with a discussion about taxing sugary drinks.
It has been around for years and is called the TV Licence!
The speaker has told the government off for the level of speculation and that some ministers - including Reeves - may have broken the ministerial code.
Exactly. Loads of bodies have called this out now, from commerce lobbies to parliamentary groups, from think tanks to the OBR themselves. It's just a farce.
Tetchytyke
Veteran Member
£3,000 a month net is a salary of about £55K to £60K. Whilst that's not staggeringly high, it is pretty much double the average wage in the UK. People earning that much (myself included) are not staggeringly well off but we're not exactly paupers either.
As for the consequence of the change, anyone who put in £20K tax-free will now be taxed on the interest on an additional £8K. Assuming 4% interest and a higher-rate taxpayer that tax will be £144, so a little over a tenner a month. I'm sure they'll somehow cope.
== Doublepost prevention - post automatically merged: ==
It's a tough one.
If you don't float things in advance then, if the financial sector takes against your proposal, you can rapidly end up in a world of pain. Ask Liz Truss. A certain amount of pre-Budget sounding out absolutely makes sense and, sadly, these days you can't trust the trade bodies and similar organisations that you sound out to not leak things they disagree with.
But running everything up the flagpole and seeing what sticks just makes you look daft.
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Bletchleyite
Veteran Member
Another sop to rich Boomers. Are we ever going to consider our young? We need to be taking from the Boomers and giving to under 30s so they can e.g. have some hope of buying a house ever.
That's particularly bad because very, very few people who are retired have a grand a month spare to save, so it really is aimed at the super-rich.
I'm quite angry about this Budget, to be honest. Not because it'll cost me a few quid (it will, but I'm in favour of higher taxation for improved public services and always have been - I'd be in strong support, for instance, of a few pence on all rates of income tax), but because it will cost me a few quid in the wrong ways (e.g. taxing pension contributions rather than income/CGT) and once again is favouring a generation that is likely the richest, overall, that has ever lived. When is a party going to be willing to be honest and simply increase Income Tax as is necessary, and start looking at e.g. how profit gained from the use of artificial intelligence can be taxed?
One bit of good news is they aren't changing it until April 2027 so next year is unaffected
The other £8k can still be put in a Stocks and Shares ISA so there is still technically a £20k allowance - but will people be investing in UK stocks and shares I'm not so sure!
Lewisham2221
Established Member
"I'm alright, Jack"
Anyone peddling the narrative that people earning at/near minimum wage are lazy and need to try harder can go and throw their opinion in the nearest bin as far as I'm concerned. There's only so many jobs. If the vast majority of them are only paying minimum wage, or a little above it, what are people supposed to do? Sometimes I wish that everyone earning sub-30k would walk out and show everyone with such an attitude just how quickly the country would fall to pieces if they weren't doing what they do.
brad465
Veteran Member
Fuel duty going up by a staged increase while rail fares freeze seems to be the first nod away from the car lobby in a long time (if ever). Obviously pay per mile for electric cars will be seen as a problem, though personally I think this should have been applied to all vehicles to replace fuel duty.
Bletchleyite
Veteran Member
Personally I'd apply it on top of fuel duty to encourage switching to EVs and to provide a short term tax take spike which would then reduce back to the previous levels as ICE cars go out of fashion.
Kite159
Veteran Member
Good news that the taxpayer will pay for the l ladies who will be going back to popping out babies every year to claim lots of benefits...
Should have kept the 2 child limit, if anybody wants to have lots of kids they can pay for them themselves
Should have kept the 2 child limit, if anybody wants to have lots of kids they can pay for them themselves
Bletchleyite
Veteran Member
I don't think these people really exist, to be honest. Having a child is a lifelong commitment and not physically easy either!
class ep-09
Member
- Joined
- 5 Sep 2013
- Messages
- 641
Do you know how much child benefit is ?
A lady could pop out a child every year, as you say, but the benefit is still very little comparing to how much raising a child costs.
Also, either “our “ mums give birth to “our” children or they have to come from abroad just to keep economy and society afloat .
It’s not child’s fault it was born but it would be “our” problem if it has nothing to eat or lives in mould infested accommodation.
Not relevant, as that is not what the two child benefit limit is about.
Now from Hansard: https://hansard.parliament.uk/commo...4B7AABFB798/FinancialStatementAndBudgetReport
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Topological
Established Member
I would like a simple world where the only tax was PAYE, either at the point of salary or at the point of profit distribution. The problem with that is you end up with a much much smaller HMRC.
Bletchleyite
Veteran Member
I think there are too many indirect taxes, but I do think some are needed, e.g. health related ones to fund the cost to the NHS of given vices (which would in a commercial system be handled by higher insurance premiums for those making poor health choices) and car related ones to fund the cost of roads.
Class73Electro
Member
Does anyone know what exactly the Landlord tax is?
From BBC:
From BBC:
Hoping my rent is going to go up too much!
Bletchleyite
Veteran Member
An increase to income tax as levied on the income from rents of a couple of percentage points.
Budget 2025: Landlord income tax rates to rise
Landlords will pay increased rates of income tax under plans announced by Chancellor Rachel Reeves today. Rates of income tax from property income will increase by two percentage points from April 2027, a move which the Office for Budget Responsibility (OBR) has recognised will hit landlords in...
www.nrla.org.uk
I don't totally understand the rationale behind this - her speech said "we want to move towards taxing all income the same" (paraphrased) then she introduced a change that, er, makes rental income taxed at 2p/£ higher than other income. It might have been as a proxy to applying national insurance to rental incomes as that is 2% above a certain cap?
brad465
Veteran Member
They said "burden", so it won't be one specific tax. If I had to guess the enhanced council tax for £2m+ homes will be an increased burden on any landlord renting out a property of that value, plus the savings-related tax band increases and ISA allowance, if that's where the rent they're paid goes.
Topological
Established Member
Maybe we can keep some point of sale stuff
Roads is a difficult one, but it is only domestic electricity for charging EVs that does not have a point of sale. The answer is in the services where charges can be added as point of sale.
I appreciate that what I am saying leaves huge room for the cash economy, for small business and for any organisation that does not need to file accounts. However, the whole point there is to encourage people to do more "side hussles", instead of the current HMRC campaign which explains how you should register these for tax.
Topological
Established Member
Politics with this one.An increase to income tax as levied on the income from rents of a couple of percentage points.
Budget 2025: Landlord income tax rates to rise
Landlords will pay increased rates of income tax under plans announced by Chancellor Rachel Reeves today. Rates of income tax from property income will increase by two percentage points from April 2027, a move which the Office for Budget Responsibility (OBR) has recognised will hit landlords in...
I don't totally understand the rationale behind this - her speech said "we want to move towards taxing all income the same" (paraphrased) then she introduced a change that, er, makes rental income taxed at 2p/£ higher than other income. It might have been as a proxy to applying national insurance to rental incomes as that is 2% above a certain cap?
Any landlord who could has already moved their property to a limited company when the mortgage relief ended. Cannot imagine how anyone could make money renting out as a private individual now.
If the tax was arranged in that way then I would be quite happy! But it is not.Then accept this change and pay the tax!
That would result in a much larger black employment market, trying to avoid PAYE. HMRC wouldn't get any smaller - employment there would shift towards catching those working but not doing PAYE. It also encourages people not to work at all. Perhaps it would be better to have all tax on VAT, to encourage everyone to work and earn money to be able to afford to buy things.....
Class73Electro
Member
An increase to income tax as levied on the income from rents of a couple of percentage points.
Budget 2025: Landlord income tax rates to rise
Landlords will pay increased rates of income tax under plans announced by Chancellor Rachel Reeves today. Rates of income tax from property income will increase by two percentage points from April 2027, a move which the Office for Budget Responsibility (OBR) has recognised will hit landlords in...
I don't totally understand the rationale behind this - her speech said "we want to move towards taxing all income the same" (paraphrased) then she introduced a change that, er, makes rental income taxed at 2p/£ higher than other income. It might have been as a proxy to applying national insurance to rental incomes as that is 2% above a certain cap?
Thanks guys