Child Benefit Scrapped For Higher Rate Tax Payers From 2013

Ignitionnet · 04-10-2010, 08:49

http://www.bbc.co.uk/news/uk-politics-11464300

Quote:

Child benefit is to be axed for higher rate taxpayers from 2013, Chancellor George Osborne has announced.

Parents earning over about Â£44,000 who pay 40% tax and above will be affected.

He confirmed the cut would hit homes with a single or two high earners. But families with two parents on modest incomes - which might add up to over Â£44,000 - will keep the benefit.

For the lazy: Households where there is a parent who earns over about Â£44,000 and is in the 40% tax bracket or higher will no longer receive child benefit from 2013. It will not affect homes where no-one pays the 40% regardless of combined income.

**Hugh** · 04-10-2010, 08:51

Sounds reasonable to me.

Ignitionnet · 04-10-2010, 08:54

Quote:

Originally Posted by Hugh

Sounds reasonable to me.

(btw, why "lazy households?).

Bah punctuation. Corrected

It was one of those 'Uncle Jack' phrases...

Agreed - obviously not ideal but in the current climate perfectly reasonable.

Nugget · 04-10-2010, 08:55

When I heard this on the radio this morning, there was no indication that it would be based on the 40% tax limit, so I wasn't overly impressed as 44k isn't that difficult to reach for a combined salary (although I don't think that myself and Mrs Nug are quite there, due to her working part-time).

Having actually read a little more of the detail, I don't particularly have a massive problem with it, although I am aware that this may be because I'm not affected

peanut · 04-10-2010, 08:56

I don't think the proposed idea is arguable. It's common sense more than anything and it is the right thing to do.

As for the rest of the benefit reform, I don't know enough yet to comment. I don't see how for the time being it'll work. There's going to be 2 systems, one for the old claimants and one for the new, the computer systems for this sounds like a nightmare and the hassle for the staff to implement it sounds crazy. Still, we'll have to wait and see really.

Wayfair · 04-10-2010, 08:58

So couples who earn just under the 40% are exempt even though they could have a joint income of Â£70,000?

chris9991 · 04-10-2010, 08:59

Just one point - how are they going to cope with people who change circumstance i.e. lose/change jobs, single parents getting married etc...

It could mean a lot of paperwork to keep tabs on the changes

peanut · 04-10-2010, 09:06

Quote:

Originally Posted by Wayfair

So couples who earn just under the 40% are exempt even though they could have a joint income of Â£70,000?

Yeah it seems that way, doesn't seem right/fair really does it. They should do it as a joint income at a proposed cap / means tested.

Ignitionnet · 04-10-2010, 09:09

Quote:

Originally Posted by peanut

Yeah it seems that way, doesn't seem right/fair really does it. They should do it as a joint income at a proposed cap / means tested.

Means testing would wipe the savings out making the entire exercise pointless. The whole point is not doing means testing.

peanut · 04-10-2010, 09:15

Quote:

Originally Posted by Ignitionnet

Means testing would wipe the savings out making the entire exercise pointless. The whole point is not doing means testing.

Yeah I can understand that, and I can understand that someone on 44k isn't going to miss this benefit at all anyway, so it is just nit picking I suppose. A couple with 75k+ income keeps the amount but someone on 45+ won't is going to be argued even though it doesn't mean much to the people claiming it. Just saying it looks a bit odd that's all.

Angua · 04-10-2010, 09:20

With both parents working and earning to that level, chances are they will have child care costs - effectively contributing to employing someone else. So not worth worrying about.

**Maggy** · 04-10-2010, 09:23

I would never have complained or thought it odd if any government had done this years ago..Always seemed crazy that higher earners got this benefit.

Though of course receiving it was one way that some stay at home mothers got their NI paid whilst they were full time carers for their children.

Acathla · 04-10-2010, 09:52

Best thing I have heard from a Government for some time.

and a promise that no one will be better off on benefits than in work will be hard to achieve but if they do it - I might just vote Tory for the first time ever.

Osem · 04-10-2010, 10:10

Not sure how it currently works or how they're planning to do this but might continuing to pay CB to all with appropriately aged children then clawing it back via the tax system (as they do with benefits in kind from employers) from higher rate tax payers be the easiest thing to do? The mechanisms for so doing are already there and fluctuations in earnings could be allowed for very efficiently.

roger skillin · 04-10-2010, 10:14

Personally i think if someone is earning more than 44k a year then they don't need to claim benefits as they're already earning enough, those of us that still work our ass off for just 18k need them because we're only on 18k, so anyone moaning that they wont get benefits and they on 45k, do you want to swap jobs with me?