[News] Do you pay more than the basic rate of Income Tax?

[boik]

Used to, but don't earn enough to pay any tax at all since we retired. Loving it though. Who needs money.

 

[schmunk]

I earnt slightly more than bugger all running my own business, virtually nothing in income tax. . . but always paid my NI, as a matter of principal

tax dodging is bad but swerving NI contributions should see you left in the gutter.

Indeed - I'm not advocating it, just stating what the dodgy "contractors" do and why IR35 has been much more heavily policed recently.

 

[Questions]

I paid tax once and didn’t like it so I don’t bother now

 

[Beach Hut]

Not since retiring

 

[Hamilton]

No, not a Monopoly question, do you earn over the HMRC threshold for an increased rate of income tax?

https://www.bbc.co.uk/news/business-61996117

Higher rate taxpayers paying 40% earn £43,663 or over in Scotland and £50,271 in England, Northern Ireland and Wales. They do not pay tax on the first £12,570 of earnings covered by the personal allowance.

No. Because my money is all offshore in tax havens.


Sent from my iPhone using Tapatalk

 

[The Antikythera Mechanism]

If you are operating through a Personal Service Company, normally:

• you pay yourself a minimal wage as an employee (just enough to kiss the bottom of the NI threshold, but not actually pay any NI) - this is your £8k.
  
• The balance of company profit is subject to Corp Tax at 19%.
  
• Dividends can then be paid out to you from this taxed profit.
  
• You pay personal income tax, but not NI, on the distributed dividends. Anything over £2,000 needs to be reported on a tax return.

You’re absolutely right, but I’m not an accountant, so that’s why I pay him £3k a year in fees. When I was PAYE, I had a massively negative tax code, through having two company cars, Health cover and other benefits and also paid income tax at 50%. I’m now a part time consultant and take home the same nett income on half the full time income I used to earn.

 

[schmunk]

You’re absolutely right, but I’m not an accountant, so that’s why I pay him £3k a year in fees. When I was PAYE, I had a massively negative tax code, through having two company cars, Health cover and other benefits and also paid income tax at 50%. I’m now a part time consultant and take home the same nett income on half the full time income I used to earn.

Net cash, presumably?

Like-for-like you'd need to add back the cars, health care and other benefits, plus £3k.


(N.B. the 50% top tax rate ended in April 2013, but I get your point.)

 

[The Antikythera Mechanism]

Net cash, presumably?

Like-for-like you'd need to add back the cars, health care and other benefits, plus £3k.


(N.B. the 50% top tax rate ended in April 2013, but I get your point.)

That’s true, I now pay £4k a year for private healthcare plus my accountants fees. I still have the cars which cost me nothing, but now have to maintain. I sold my shares in my company in 2014, so may have benefited from a lower tax rate in the final year.

 

[LamieRobertson]

It's all cash in hand in your line of work, isn't it?

Lol….tbh no….I get very little cash now…cut down on work over the past year for various reasons and most now gets paid direct to bank account by MA’s

 

[Sorrel]

Our current tax system has plenty of annoying grab backs that end up with some people paying an even higher rate of tax than the 40% or 45%. Things like:
- Frozen thresholds (worse in Scotland)
- Child Benefit grab back between £50,000 to £60,000
- Personal allowance removal between £100,000 and £125,000
- Pension lifetime allowance reduction over the last ten years
- Tapered pension allowance, down to zero, for those over £200,000 (so tax is paid on pension contributions over £4,000 at least).

I would guess a lot of people don't care as they don't think they will affect them, but the first item - the frozen thresholds - is starting to affect more people each year and as inflation increases the above will be catching an increasing number of people.

 

[vegster]

Our current tax system has plenty of annoying grab backs that end up with some people paying an even higher rate of tax than the 40% or 45%. Things like:
- Frozen thresholds (worse in Scotland)
- Child Benefit grab back between £50,000 to £60,000
- Personal allowance removal between £100,000 and £125,000
- Pension lifetime allowance reduction over the last ten years
- Tapered pension allowance, down to zero, for those over £200,000 (so tax is paid on pension contributions over £4,000 at least).

I would guess a lot of people don't care as they don't think they will affect them, but the first item - the frozen thresholds - is starting to affect more people each year and as inflation increases the above will be catching an increasing number of people.

I'm fine, as I earn **** all I pay **** all...Sorted.

 

[Questions]

I'm fine, as I earn **** all I pay **** all...Sorted.

That’s because you do fu k all

 

[hampshirebrightonboy]

Our current tax system has plenty of annoying grab backs that end up with some people paying an even higher rate of tax than the 40% or 45%. Things like:
- Frozen thresholds (worse in Scotland)
- Child Benefit grab back between £50,000 to £60,000
- Personal allowance removal between £100,000 and £125,000
- Pension lifetime allowance reduction over the last ten years
- Tapered pension allowance, down to zero, for those over £200,000 (so tax is paid on pension contributions over £4,000 at least).

I would guess a lot of people don't care as they don't think they will affect them, but the first item - the frozen thresholds - is starting to affect more people each year and as inflation increases the above will be catching an increasing number of people.

Yes - The headline tax rate is becoming more and more irrelevant. We are moving to a high tax country.

 

[DavidinSouthampton]

As a pensioner I don’t. As a pensioner Mrs DiS does……. But she hasn’t voted.