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Seems to me the hardest hit are people from 18-40k
In terms of disposable income + cost of living, yes, but in terms of tax? At around 100k the marginal rate is 60%+ (i.e. every extra £1 you earn you keep 40p). Not saying those people deserve sympathy as that is clearly still a good income, but i can’t see much of a reason for saying that below 40k are worse taxed. VAT is the only thing i guess, on the assumption lower paid spend more of income on expenditure which might have VAT on it?
andyfallsoff-
National insurance drops at 50k, those on the basic tax rate are getting far less benefit on this pension contributions or any other kind of salary sacrifice like childcare, VAT due to spending a larger percentage of take home on basic living etc.
In terms of marginal tax rate I think 50-60k is highest due to the drop in child benefit (assuming you're eligible)
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At around 100k the marginal rate is 60%+ (i.e. every extra £1 you earn you keep 40p)
Other way round, you keep 60p (50,721 to 150,000 is taxed at 40%).
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+1
Especially if you you have young kids in nursery and say one person in a couple earns >£100k. All the child benefits and tax free allowances drop away.
greentricky
jellybaby
hugo7
There’s definitely a bell curve of don’t earn enough to pay tax, earn so much can avoid paying tax with clever schemes and loop holes.
Seems to me the hardest hit are people from 18-40k