I've just filled in my tax return. It takes three days to gather all the figures and about 20 minutes to actually write them down on the form. It has to be sent before September 30th if you want those nice people at the tax office in Cornwall (could my tax office be any farther from where I live?) to calculate the amount of money you need to send them by January 31st (great date that: you have hardly anything left after Christmas!).
My tax affairs are very simple: I earn peanuts (I only work six months of the year). Yet I have to fork out masses of dosh because the personal allowance is so incredibly low. (I’m particularly annoyed at the amount of Class 4 Insurance I have to pay. Don't ask: it’s really complicated – lots of long divisions). Everyone agrees that no one can live in London on my income before tax so how come I still have to pay tax on it? Doesn’t make sense to me.
I don’t resent paying tax as such – I’m a good citizen and the mediocre services we get have to paid for somehow; I just think there should be a lower rate for very small earners. What is one to do? Earn no more than the allowance (currently £4,745) and then go on benefit? It’s preposterous.
I'm quite frugal; I don't spend spend spend; I know the value of money, unlike some people… What was it Catherine Zeta Jones said in that courtroom? Something like (cue weird transatlantic-Welsh accent) “One million may seem like a lot of money to some people in this room, but to us it’s nothing.” Or, on a smaller scale, a little while ago, someone wrote about a range of outrageously priced make-up, “Soixante-dix euros de plus ou de moins ne rendront personne plus riche ou plus pauvre.” (No, I won’t translate it: you understand what it means.) Shades of bird-brained Marie-Antoinette and her “Let them eat cake!” I should have got myself a rich hubby.
Feeling depressed now. Too depressed to slap anyone – not even those two silly women above or Mr Brown.
Update: Sorry about all that kvetching. I’ve now had a good night’s sleep; I feel refreshed and strong enough to slap anyone: so I’m slapping Gordon Brown (and those two arrogant women).
I’d like to clarify a couple of points:
When I say, “I only work six months of the year”, I mean it’s not from choice: I was quite ill a few years ago and couldn’t carry on having deadlines every two or three days, so I had to let go of a big portion of my workload. There is nothing available for me to do to replace that lost income.
When I say, “I earn peanuts”, I mean I earn less than twice the personal allowance before tax (you’ve got the amount, you can work it out).
In France, there is a super-super high-rate tax, called “Impôt de Solidarité sur la Fortune”, which hits people earning over £500,000. In the UK, whether you earn over £500,000 or over £31,400 you're liable to the same tax rate. In France, Inheritance Tax starts around £25,000; here it’s £263,000. There's no mystery, is there? No wonder there's more money in the French kitty.
Tuesday, 27 September 2005
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It's true, a rich man is just as easy to love as a poor man.
ReplyDeleteI came back to the UK after many years away, mid-way through a tax year. The forms involved were staggering. This year I mentioned to a clerk at the tax office after my third regrading this year that I remembered when the tax office didn't rely upon so many untrained people having to fill in forms, even if you're on PAYE, and then jumping up and down on them for minor mistakes in the individual's favour, and looking the other way when the tax office benefitted. The snot nosed 12 year old (that's how old he seemed) came out with "people have always had to fill in these forms". If I could have reached down the 'phone to give him a slap, I would have. If you're too depressed to slap, let us do it - but you're more practiced. Not for taxes in general (it's right I should pay them, and used properly taxes can be a huge force for good), but the witless idiots who have allowed it to grow so complex, unfair and unthinking. Administering without improving, judgemental without a sense of justice, and being "job's worths" without realising the potential worth of their job. Go on; pull yourself together and slap them for us. Pretty please?
ReplyDeleteahh..taxes. A truly Canadian experience. Are we honestly the most taxed nation in the world? And I do believe we have the most corrupt politicians, who use our tax dollars to forward their own gains. We even pay taxes on taxes on taxes-federal taxes first, then provincial, then the HST of 15% added on top of both.
ReplyDeleteI cannot stand the tought of you not slapping them-put on some gorgeous French perfume, use lipliner and lipstick (can't face things like this without lipstick) and warm up your arm. We depend on you! You cannot let us down. ready...Steady...WHAM!
There is actually a question on this year's form which says 'Are you using any tax avoidance schemes? If so, what are they, please tick below.' I've never seen that before. It made me think how openly the whole scheme is weighted towards the rich having ways to save themselves money. Tax avoidance, tax evasion, there's a fine line, but those earning tens and tens of thousands pay accountants to jiggle and juggle and get them off the hook. For example: someone I know works as a managing director. He gets the company he works for to employ him on repeated short-term contracts. He goes in every day 9–5, uses the office equipment, etc. - i.e. he definitely doesn't act like a freelance, he is indistinguishable from a real MD. And he has set up a 'company' consisiting of just him and his stay-at-home wife as directors, and the 'company' is an agency that contracts out his services as this temp MD. His 'company' pays him a small salary and his wife a small salary, which is way less than what is paid for the services, i.e his 'company' takes its percentage - say for the sake of the example is salary is £30,000 for him and £12,000 for his wife for some admin she does, like sending his emails in the evening and proofreading his reports - she does just enough to justify the pay. So although he might get pay of, say, £140,000 for his work, which normally would be at 40 per cent, the result is that he pays basic rate tax on his small 'salary' and his wife pays basic rate tax on hers. The rest is taxed as corporation tax at, I believe, 10 per cent. And then the 'company' pays him and his wife annual 'dividends' from its profits, again taxed at 10 per cent. He and his wife, as directors, decide what those dividends will be. Then his wife employs a nanny using nearly all her salary, which also is partly tax-deductible, as are his car (a 'company car', you see?) and some other household expenses, because his 'company' is run from home. All perfectly legal. But those earning very little have no access to such schemes, and cannot afford the people to tell them about it. That's what makes it unfair.
ReplyDeleteWhat, Stef - you mean the tax office don't tell you when you make a mistake in their favour?????
Too depressed to slap? Oh, J, this is a sad day indeed. Of all things, mindless bureaucracy is in dire need of slapping. I love Stef the Engineer's way of putting it - "administering without improving, judgemental without a sense of justice" - exactly what we get from our IRS over here. The average US citizen works about 1/3 of the year just to cover the taxes owed for that year. So you would think our government would appreciate our diligent labor - but no. When it comes time to file our taxes, we face a welter of confusing forms, instructions that refer back to each other (liking using a word to define itself), and contradictory responses when we contact the help-line. The whole system seems set up to enrich tax accountants and those who can afford to employ them - average citizens just get screwed.
ReplyDeleteC'mon, then. Lift at the elbow...draw back...SLAP!
LOL!, SL. :-)
ReplyDeleteStef, I’ve always had to fill in tax returns: in France, everyone does, whether they’re employees or freelancers (at least that was the case when I lived there), and I’ve been freelance here for 18 years. A long time ago, I remember going to my tax office (when it was in Notting Hill Gate, not in Cornwall, LOL!) and explaining something to one of the clerks, who then turned to his colleague and said in a tone of utter astonishment, “She understands tax!” The people in Cornwall are lovely, actually, and so are the ones answering the phone on the helpline (the whole BT network was stuck on Sunday, when I tried to phone to find out a detail that should have been mentioned in a prominent place, but was in fact hidden on the last page of the calculating guide, in tiny tiny print).
A few years ago, I noticed I’d made a small mistake: it was a question of a few pence in their favour, but I thought, “Why should I let them have it?” so I rang up Cornwall: the clerk agreed there was a mistake and added that a lot of people had made it, so it occurred to me that several million pence still added up to a few million pounds and said so to the clerk, who laughed and said, “Yep!” They refunded me straightaway. It felt very good.
The French pay a lot of taxes too, Anon, but they get an awful lot for their money. You do too, don't you? I wouldn’t mind forking out all that money if we had an efficient NHS, etc., but all the public services are in an appalling state at the moment. The question is always: what do I get for my money? I’m a canny shopper; I don’t like getting conned.
OMG, L, I never even saw that question. LOL! The only tax avoidance scheme small earners have is to not work at all. ;-)
D, at least I’m lucky that I can fill in the forms easily since my affairs are so straightforward. I would have to use an accountant otherwise.
Oh my, how utterly horrible to have taxes due right after Christmas. April (in the US) is quite bad enough, but at least you have some time to recover after the holidays.
ReplyDeleteAaargh, Red-Queen, what a horrifying way of putting it - working a third of the year just to pay taxes!!! I guess that's nearly the same here too, with 22 per cent basic rate tax and 8 per cent 'national insurance'. And you don't even have free healthcare for all! I'm going to forget you said that! Plus our sales tax (that's what HST is, isn't it?) is 17.5 per cent.
ReplyDeleteI do so agree with Bela and Stef, that it's really how it's spent that counts. You only start resenting it when you get nothing much for it. Waiting lists of 18 months to see a physio, for example, and 3 years for a first consultation with an ENT specialist. Privatised transport that kills people (yes, truly - recent rail crashes have been proven to be the private company not maintaining tracks). Privatised water companies letting pipes leak so much water that it is equivalent to every household in London flushing their toilet 90 more times daily, then paying huge bonuses to the directors and sending us letters about saving our bath water to water the garden. (Sorry, getting off topic in my rage!) I do look longingly at the Scandinavian countries, who are still doing proper cradle-to-grave care. Would be happy to pay more there.
I'm with Robin - the timing sounds like it sucks as well. Yikes. What a busy crazy time of the year anyhow, and then that on top of it all?? Yeesh.
ReplyDeletei'm all for a more redistributive tax system (larger personal allowances and a higher rate of tax for high earners) but even new labour don't like to say the 'R' word...
ReplyDeleteHmm..., D & L, I don't want to think of tax in that way either. Too scary.
ReplyDeleteK, I'm not sure there's a right time for paying one's taxes (I make sure I fill in the return by the end of September so, at least, I don't have to bother with that part in January).
UC, I wonder why New Labour's not keen on it. LOL! How many millionaires (I think it looks wrong with only one 'n' in English) did they say there were in the UK now? Perhaps CZJ was right: a million pounds isn't that much these days.