The Very Meh Humza Yousaf Thread.

[lichtgilphead]

1 hour ago, Left Back said:

Very Tory.

Resorting to insults now, are we?

You never answered my question - do you claim your tax allowances to minimise your tax exposure? If you do, does that make you "Very Tory" too?

[Left Back]

4 minutes ago, lichtgilphead said:

Resorting to insults now, are we?

You never answered my question - do you claim your tax allowances to minimise your tax exposure? If you do, does that make you "Very Tory" too?

I’m not the one proudly claiming I’ll be avoiding paying any additional tax so I’ll keep my financial affairs private thanks.

I’m also not the one claiming that any tax avoidance is OK as long as you can’t be prosecuted for it.

If you do the things right-wingers get castigated for you’ll be lumped in with them.

[Aufc]

Yeah don’t really understand why they froze council tax when it’s clear it’s increasing the deficit by a huge sum. Clearly just trying to win votes which sums up every political party 

[Left Back]

1 minute ago, Aufc said:

Yeah don’t really understand why they froze council tax when it’s clear it’s increasing the deficit by a huge sum. Clearly just trying to buy votes which sums up every political party 

FTFY

[Soapy FFC]

21 minutes ago, Left Back said:

I’m not the one proudly claiming I’ll be avoiding paying any additional tax so I’ll keep my financial affairs private thanks.

I’m also not the one claiming that any tax avoidance is OK as long as you can’t be prosecuted for it.

If you do the things right-wingers get castigated for you’ll be lumped in with them.

The thing about putting part of your salary onto a pension to ‘avoid tax’ is that you are deferring that part of your salary to sometime in the future, when you will ultimately pay any tax due, but the immediate effect is you have reduced your take home pay. For some people it might be 20 or 30 years before they get their hands on that deferred salary (and who knows what the tax regime will be then). It’s a bit different to someone who uses tax allowances/schemes/loopholes to avoid paying tax whilst still receiving an immediate income which will increase their take home pay, and is in my view is an absolute loss of money to the treasury.

[Left Back]

5 minutes ago, Soapy FFC said:

The thing about putting part of your salary onto a pension to ‘avoid tax’ is that you are deferring that part of your salary to sometime in the future, when you will ultimately pay any tax due, but the immediate effect is you have reduced your take home pay. For some people it might be 20 or 30 years before they get their hands on that deferred salary (and who knows what the tax regime will be then). It’s a bit different to someone who uses tax allowances/schemes/loopholes to avoid paying tax whilst still receiving an immediate income which will increase their take home pay, and is in my view is an absolute loss of money to the treasury.

Good theory.

You get to take 25% tax free and you also get your tax free allowance and will likely be paying tax at a lower rate when retired so you aren’t just handing over the same amount at a later date.

Even if you were handing over the same amount due to inflation it would be worth less in the future.

I agree about tax avoidance schemes/loopholes, legal or otherwise.  Some obviously don’t though.

[vikingTON]

10 minutes ago, Soapy FFC said:

The thing about putting part of your salary onto a pension to ‘avoid tax’ is that you are deferring that part of your salary to sometime in the future, when you will ultimately pay any tax due, 

You won't be paying even remotely the same rate of tax when you collect it in a pension. Pension savings are important but let's not pretend that it's a neutral trade-off in terms of tax. Governments do (and should) offer some financial incentives to save for retirement - whether those incentives match the wider needs of society is an open question.

[lichtgilphead]

33 minutes ago, Left Back said:

I’m not the one proudly claiming I’ll be avoiding paying any additional tax so I’ll keep my financial affairs private thanks.

I’m also not the one claiming that any tax avoidance is OK as long as you can’t be prosecuted for it.

If you do the things right-wingers get castigated for you’ll be lumped in with them.

Assuming that you work, you'll be paying into your employer's pension scheme?

You won't be taxed on these payments at this time. Accordingly, you avoid tax in exactly the same way that I do - by contributing to your retiral pension. The only difference is that I pay more than the statutory minimum.

You also seem to be forgetting that I will pay tax on the higher pension that I will receive when I retire. Effectively, all I am doing is postponing the tax on that money.

Finally, you should educate yourself regarding the difference between avoidance & evasion. 

 

[Left Back]

2 minutes ago, lichtgilphead said:

Assuming that you work, you'll be paying into your employer's pension scheme?

You won't be taxed on these payments at this time. Accordingly, you avoid tax in exactly the same way that I do - by contributing to your retiral pension. The only difference is that I pay more than the statutory minimum.

You also seem to be forgetting that I will pay tax on the higher pension that I will receive when I retire. Effectively, all I am doing is postponing the tax on that money.

Finally, you should educate yourself regarding the difference between avoidance & evasion. 

 

Oops.  You should have read my last post before diving in two footed again.

I don’t think I need to take advice on education from someone who doesn’t have the faintest idea what they’re on about either.

[lichtgilphead]

39 minutes ago, Left Back said:

Oops.  You should have read my last post before diving in two footed again.

I don’t think I need to take advice on education from someone who doesn’t have the faintest idea what they’re on about either.

Are you suggesting that the additional pension I receive from my AVC payments will be tax free? You're deluded. I'll pay tax on my whole pension at whatever rate (and allowances) are in force at the time. 

Can I borrow your crystal ball to find out what that rate will be?

[vikingTON]

3 minutes ago, lichtgilphead said:

Are you suggesting that the additional pension I receive from my AVC payments will be tax free? You're deluded. I'll pay tax on my whole pension at whatever rate (and allowances) are in force at the time. 

Can I borrow your crystal ball to find out what that rate will be?

Do you seriously expect the taxable rate on your pension to be even remotely equivalent to the taxable rate on your working income? 

[Left Back]

2 minutes ago, lichtgilphead said:

Are you suggesting that the additional pension I receive from my AVC payments will be tax free? You're deluded. I'll pay tax on my whole pension at whatever rate (and allowances) are in force at the time. 

Can I borrow your crystal ball to find out what that rate will be?

Try going back and reading my post, and the one after it.  Then have a look at how pensions work in case you still don’t get it.

You’re having a nightmare here.

[Soapy FFC]

1 hour ago, Left Back said:

Good theory.

You get to take 25% tax free and you also get your tax free allowance and will likely be paying tax at a lower rate when retired so you aren’t just handing over the same amount at a later date.

Even if you were handing over the same amount due to inflation it would be worth less in the future.

I agree about tax avoidance schemes/loopholes, legal or otherwise.  Some obviously don’t though.

I would like to think that when I came to withdraw from my pension, it will be worth a lot more than the contributions I put in, so I may well be paying more tax than I would have paid on the original contributions. But that's just me guessing/hoping, in the same way you are guessing I will pay less tax.

The problem I see is I pay income tax. Surely income is the money that you get that can be used to buy or pay for things. If you defer your pay by putting it in a pension, that money is not accessible to you to be spent, so it is not income. It only becomes income when it becomes available to use when you retire and after you withdraw it, so currently that is when you pay the tax.

People are objecting to others 'avoiding tax' by putting money into a pension scheme. The 'problem' probably isn't that you don't pay tax on your contributions, but how the pension itself is taxed. Maybe there shouldn't be a 25% tax free, maybe there should, but that is part of the taxation rules for how money is TAKEN out of the scheme, in other words how you draw your income from the pension.

If you tax what goes in, then don't tax what goes out, or treat what goes out in the same way as capital gains, since after all most of the value of a pension will not be the actual contributions, but the gain in value of the investments in the pension.

The only time that someone can realistically use payments to pensions to avoid paying tax, is if they are only a year or two away from retirement, in which case they can put money into pension and withdraw it very quickly to make use of the 25% tax free.

[lichtgilphead]

2 minutes ago, virginton said:

Do you seriously expect the taxable rate on your pension to be even remotely equivalent to the taxable rate on your working income? 

Not having a crystal ball, I don't know what the tax rate will be on my pension.

At today's rates, however, I would expect the tax rates to be based on the following figures after taking into account any allowances I'm entitled to. I would expect to pay a top rate of 21%

Taxable income	Band	Tax rate
Over £14,733 to £25,688	Scottish basic rate	20%
Over £25,689 to £43,662	Intermediate rate	21%
Over £43,663 to £125,140	Higher rate	42%
Above £125,140	Top rate	47%

8 minutes ago, Left Back said:

Try going back and reading my post, and the one after it.  Then have a look at how pensions work in case you still don’t get it.

You’re having a nightmare here.

Please explain what you consider to be incorrect in my previous postings. You were wrong about me being a Tory, so your success rate isn't really that great.

[Left Back]

9 minutes ago, lichtgilphead said:

Not having a crystal ball, I don't know what the tax rate will be on my pension.

At today's rates, however, I would expect the tax rates to be based on the following figures after taking into account any allowances I'm entitled to. I would expect to pay a top rate of 21%

Taxable income	Band	Tax rate
Over £14,733 to £25,688	Scottish basic rate	20%
Over £25,689 to £43,662	Intermediate rate	21%
Over £43,663 to £125,140	Higher rate	42%
Above £125,140	Top rate	47%

Please explain what you consider to be incorrect in my previous postings. You were wrong about me being a Tory, so your success rate isn't really that great.

So you’re avoiding paying tax at 42% to defer the tax liability to be paid on that money at 21%, after inflation.

I real terms that’s less than half.

You’re also conveniently avoiding the fact that you can withdraw 25% tax free.

Were you a financial adviser to Liz Truss?

Edited December 15, 2023 by Left Back

[Soapy FFC]

2 minutes ago, Left Back said:

So you’re avoiding paying tax at 42% to defer the tax liability to be paid on that money at 21%, after inflation.

I real terms that’s less than half.

You’re also conveniently avouding the fact that you can withdraw 25% tax free.

Were you a financial adviser to Liz Truss?

He's also 'avoiding' some of his income at present, so taking home less money. As I've said previously, if you don't take it as income, how can you pay income tax on it?

[Left Back]

1 minute ago, Soapy FFC said:

He's also 'avoiding' some of his income at present, so taking home less money. As I've said previously, if you don't take it as income, how can you pay income tax on it?

That’s the point.  The tax isn’t being paid and because of the deferral the tax that will be paid on the salary that is earned now will be lower in both actual, and real terms.

People claim they want good public services but behaviour such as this removes money from the public purse to put it into private hands.

He (assuming gender there) started the conversation by saying they were upping their pension contributions to avoid tax.

[Soapy FFC]

6 minutes ago, Left Back said:

That’s the point.  The tax isn’t being paid and because of the deferral the tax that will be paid on the salary that is earned now will be lower in both actual, and real terms.

People claim they want good public services but behaviour such as this removes money from the public purse to put it into private hands.

He (assuming gender there) started the conversation by saying they were upping their pension contributions to avoid tax.

Do you have a crystal ball and know how much investments will return in the next 10, 20, 30 years? Do you know how old the person making the contribution is and how long the contribution will be invested before it's taxed? Most pension investments aim to have a return of inflation+x%, so I don't really follow your lower in real real terms tax paid.

[lichtgilphead]

2 minutes ago, Left Back said:

So you’re avoiding paying tax at 42% to defer the tax liability to be paid on that money at 21%, after inflation.

I real terms that’s less than half.

You’re also conveniently avoiding the fact that you can withdraw 25% tax free.

Were you a financial adviser to Liz Truss?

Under the current UK tax sysyem, I'm entitled to defer my salary. I'll pay taxes at the relevant rates every year of my working life, and will continue to pay tax at whatever rate is in force when I retire.

You seem to have some sort of problem with these facts,

I note that you've not taken up my invitation to explain why you think that the facts I've posted are incorrect, but have instead again resorted to abuse. Is that all you have?

1 minute ago, Left Back said:

That’s the point.  The tax isn’t being paid and because of the deferral the tax that will be paid on the salary that is earned now will be lower in both actual, and real terms.

People claim they want good public services but behaviour such as this removes money from the public purse to put it into private hands.

He (assuming gender there) started the conversation by saying they were upping their pension contributions to avoid tax.

1) The tax will be paid when I receive the income. That's how income tax works.

2) Do Labour plan to change this? Do you consider Keir Starmer to be a Tory because he has special additional  tax privileges in addition to those available to the public? See the Pensions Increase (Pension Scheme for Keir Starmer QC) Regulations 2013

3) No. I started the conversation by showing that I paid a similat amount of tax to someone based in England on the same salary with the same AVC payments, thus showing the assertion that Scottish taxpayers on £50,000 paid £1500 more than their Englash equivalents to be incorrect

[strichener]

5 minutes ago, Soapy FFC said:

Do you have a crystal ball and know how much investments will return in the next 10, 20, 30 years? Do you know how old the person making the contribution is and how long the contribution will be invested before it's taxed? Most pension investments aim to have a return of inflation+x%, so I don't really follow your lower in real real terms tax paid.

You are assuming that this the poster in question is not on a defined benefit pension.  I am guessing that he is.