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  • Section 24 HQ

    Earn £50K, 3 kids, 1 BTL mortgage = 87% tax



    Welcome to conservative Britain!

    Earn over £50k, have 3 kids and at least 1 buy to let mortgage then you get a marginal tax rate of 87%!

    Income tax 40%

    S24 tax 20%

    NI 2%

    Child benefit payback: 25%

    So much for aspirational Britain!

    At least I can divert a load to my pension instead - then retire early take 25% tax free and pay off mortgage.

    Then use draw down to only take exactly what I need and keep future tax bills to a minimum.

    Can't help thinking setting a reasonable tax rate would result in a larger long term tax take!

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    Thats why im not interested in earning more than 50k. Im on the borderline now so why bother working my ass off for any more when almost half of it will get taken by the goverment.

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    My only way round the increased tax is to earn less from my other businesses by adding my teenage kids to the books.  Spread the wealth.

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    Son received his National Insurance number yesterday, I with you on getting the kids onto payroll ?

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    That is fine if offspring are actually involved in the BTL business full time - but if they also have other full time jobs they then have eroded their own Personal Tax Allowance to potentially nil.

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    I have little issue in paying high tax provided we were getting value for money in services in return - if we compare our services to those of any country in Western Europe then we are more of a third world grade service.

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    Me too - it is doing my head in.

    I am in a job where doing some paid overtime is inevitable - I don't see anything for it as it all (along with bonus) goes into my pension.

    Not had an "effective" pay rise for a few years.

    Last few years have even seen me buying 5 weeks unpaid leave a year. 

    And then they wonder why I don't want promotion!

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    Is your wife/partner a lower tax payer? If so could you not transfer the btl property into her name so the income is taxed at a lower rate compared to yours?

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    It is split 90/10 in my wife's favour.


    With S24 it does not matter as £1 of interest in my name still means 87p of it goes back to the tax man.  So if split was 99/1 it would still be 87% tax.

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    But at least 90% of the income is paid at the lower tax rate rather than the whole lot paid at the higher tax rate.

    I also earn just over 50k, have 2 buy to let properties and a 6 month old daughter. I also get annoyed with the amount of tax I pay. I am still looking at buying more property as my end goal is to have property  income replace my salary.

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    The conservatives appear to not want anyone to earn over 50k

    Increase your portfolio but don't have any more kids!

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