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I know it's common in lots of places, but what's the justification. Should renters be able to deduct rent from their income tax bill? Car loan payments? It just seems like a random bung to one segment of society.
The one I have more sympathy with is something like deducting the cost of childcare if you go back to work. You're paying someone's salary, which they are then paying tax on. At the moment you need to earn £50k gross to get a childminder £15k net or some stupid arithmetic like that.
NickCJ-
what's the justification. Should renters be able to deduct rent from their income tax bill? Car loan payments?
It encourages and accelerates homeownership so that people don’t need to rent. Take the Netherlands as an example, 65% homeownership rates and 30% social housing stock which is subsidised. Cars are pretty much taxed to death which they should be as they’re an unnecessary luxury.
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At the moment you need to earn
When our nursery hiked their fees before the parents kicked off, I worked out what the cost for our friends with 3 kids full time was grossed up.
Iirc you'd need to be earning >£86k to cover the bill.
jaw
hugo7
Owner occupied homes should have a tax rebate on interest repayments. Seems to work just fine in plenty of countries. e.g. £12,000 annual interest repayment is taken out of gross earnings and lowering your taxable income. If you’re living mortgage free than it incentives to upgrade your home or otherwise pay full taxes.