Quote:
Originally Posted by tweedle
You don't pay the 40% rate on the £40'000 you pay it on anything over the 40% tax threshold. Anything you earn below the 40% threshold is taxed at the normal rate.
Very simple example,
You earn £20'000 the 40% tax rate is on earnings over £15'000 so you pay the lower rate on the first £15'000 then the final £5000 is taxed at 40%.
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I know how the tax system works, my point is that those middle income workers are the ones who suffer most ,paying more tax and receiving no state aid at all can leave them worse off than lower paid workers who pay no tax and receive tax credits .Just because part of someones earnings are taxed at 40% does not mean they are rich and can afford to pay more tax.In theory and practice they are the people contributing most to society so why should they be punished ?