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Child Tax Credits To Be Slashed For Anyone Earning Over £30,000

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http://www.dailymail.co.uk/news/article-1287366/Child-tax-credits-slashed-earning-30-000.html

Millions of families are set to lose payouts of more than £500-a-year as the coalition takes the axe to child tax credits, Nick Clegg signalled today.

Next week's Budget will move to slash the payments for middle earners, the Deputy Prime Minister indicated.

Mr Clegg attacked the expansion of the handouts under Labour and insisted it was not 'unreasonable' to reduce them for better off families.

The payments are now received by nine out of 10 families and are going to many parents 'who don't really need it', he said.

It is understood the move will affect anyone earning more than £30,000 - meaning millions of families will lose out.

...............

The Conservatives had wanted to reduce child tax credits for families with an income over £50,000-a-year.

But he has been forced to go further in order to strike a compromise with the Liberal Democrats, who wanted them slashed for families on incomes as low as £25,000.

Mr Clegg said today: 'Surely, everyone agrees that having tax credits extended, which is basically a means-tested benefit, to nine out of 10 of every family in this country which has got children means you are giving a lot of money - taxpayers' money, other people's money - to people who don't really need it.

'We want to taper them away from those families who have much more money than others. I do not think that is an unreasonable way to go.

Obviously the country can't afford this but you are now entering a massive catch 22, the banks took these tax credits to work out "how much you could afford" in mortgage repayments. I can remember the last time we moved this mortgage adviser saying the banks took this as "income". At the time I didn't find this comfortable as my own view was this "income" could be taken away at any point in the future.

Now I wonder how many of millions who are receiving this benefit pushed the mortgage boat out and use it to get more leverage.

This is going to effect the incomes of many people, aggregate demand is going to take a huge hit.

A debt deflation spiral seems a certainty.

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How much is it possible to get in child tax credits? If it is possible to get say £200 a month then it will impact some. Hardly likely to be the straw that broke the camel's back though.

Thinking of not applying at all this year because we only got £90 last year, filling the form in was a ball ache and it's almost like they're trying to catch you out. Three years ago we inadvertently put an incorrect value on the form - only a few hundred quid out (we forgot to include some stat maternity pay) and made no difference to our payments. They initiated a formal investigation which went on for a few weeks then issued a written warning and threatened a £1000 fine. Not worth it.

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http://www.dailymail.co.uk/news/article-1287366/Child-tax-credits-slashed-earning-30-000.html

Obviously the country can't afford this but you are now entering a massive catch 22, the banks took these tax credits to work out "how much you could afford" in mortgage repayments. I can remember the last time we moved this mortgage adviser saying the banks took this as "income". At the time I didn't find this comfortable as my own view was this "income" could be taken away at any point in the future.

Now I wonder how many of millions who are receiving this benefit pushed the mortgage boat out and use it to get more leverage.

This is going to effect the incomes of many people, aggregate demand is going to take a huge hit.

A debt deflation spiral seems a certainty.

If this is true, it's about bloody time.

A benefits system that's giving money to familes with an income of over £30k is obviously flawed, no wonder the country's finances are in the state they are.

The sooner the benefits system is returned to a safety net for those in need the better.

if anyone on £30k or over is in need, they need to sort their budget out and live within their means.

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http://www.dailymail.co.uk/news/article-1287366/Child-tax-credits-slashed-earning-30-000.html

Obviously the country can't afford this but you are now entering a massive catch 22, the banks took these tax credits to work out "how much you could afford" in mortgage repayments. I can remember the last time we moved this mortgage adviser saying the banks took this as "income". At the time I didn't find this comfortable as my own view was this "income" could be taken away at any point in the future.

Now I wonder how many of millions who are receiving this benefit pushed the mortgage boat out and use it to get more leverage.

This is going to effect the incomes of many people, aggregate demand is going to take a huge hit.

A debt deflation spiral seems a certainty.

Most obvious one for the chop, 30K? If you can't keep your kids out of child poverty on 30K...then you probably live in a society that massively over pays it's public sector workers/waste and thus are probably allowing your children, despite you best working efforts to be "TAXED INTO POVERTY".

One less barb on the benefit trap is good for the UK.

Anyone stupid enough to leverage or lend on benefit payouts ..... deserves everything that is coming to them!

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If this is true, it's about bloody time.

A benefits system that's giving money to familes with an income of over £30k is obviously flawed, no wonder the country's finances are in the state they are.

The sooner the benefits system is returned to a safety net for those in need the better.

if anyone on £30k or over is in need, they need to sort their budget out and live within their means.

Actually the OP has made a very good point. On £30k income, both parents earning £15k and working full time, 2 kids and paying £180 in childcare costs the payments are an unbelievable £6463 per year. Just been on the calculator on HMRC site.

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I dont think it will cause many mortgage problems - not if theyre in work anyway. Most i know geting CTCs who dont 'need' it just spend it on take aways, holidays, top SKY package etc. They'll economise on all that before they stop paying the mortgages.

These are middle class people after all, not the kind of hairdresser with a BTL empire who'll just dissapear off to Spain if paying the mortgage';s means less visits to the nail beauticians and no new Merc SLK every other year.

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http://www.dailymail...ing-30-000.html

Obviously the country can't afford this but you are now entering a massive catch 22, the banks took these tax credits to work out "how much you could afford" in mortgage repayments. I can remember the last time we moved this mortgage adviser saying the banks took this as "income". At the time I didn't find this comfortable as my own view was this "income" could be taken away at any point in the future.

Now I wonder how many of millions who are receiving this benefit pushed the mortgage boat out and use it to get more leverage.

This is going to effect the incomes of many people, aggregate demand is going to take a huge hit.

A debt deflation spiral seems a certainty.

Certainly does. tongue.giftongue.gif

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about time, dont think it willhavemuch impact on anyone really, but still all helps to save money, and not give it to people who do not need it

In the context of this thread perhaps the point is that people who shouldn't need it have become dependent on it.

Remember Clegg wanted to cut it for income over £25,000. 2 parents both working, 2 kids, £180 a week childcare = £8,028 a year.

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A benefits system that's giving money to familes with an income of over £30k is obviously flawed,

that depends on whether you think a falling population is good for the economy and healthy interest rates of the kind beloved by prudent savers.

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Most obvious one for the chop, 30K? If you can't keep your kids out of child poverty on 30K...then you probably live in a society that massively over pays it's public sector workers/waste and thus are probably allowing your children, despite you best working efforts to be "TAXED INTO POVERTY".

One less barb on the benefit trap is good for the UK.

Anyone stupid enough to leverage or lend on benefit payouts ..... deserves everything that is coming to them!

£30k doesn't get you anywhere especially if you live in the south east! If you are on £30k you are effectively classed as very poor.

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if anyone on £30k or over is in need, they need to sort their budget out and live within their means.

If it is household income, which it sounds like, then it really isn't a huge amount to be living on if you have two kids and a mortgage.

Will be interesting to watch how it pans out..

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I am generally of the opinion that inflation will win through in the end but the fact credit is contracting and there remains little appetite from the banks to lend, cuts in spending such as these CTC's etc and that there will be higher taxes should mean a reasonable period (perhaps a year, who knows) of very low inflation & maybe deflation. This will obviously leads to more QE though and perhaps another big drop in sterling.

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Worked with two people both were on 40% tax rate,

No1 . Married man non working wife 3 children got no tax credits.

No2. Divorced women 2 children got tax credits.

Number 1 earnt a slightly more than number 2 but number 2 ended up taking home more money due to tax credits.

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Actually the OP has made a very good point. On £30k income, both parents earning £15k and working full time, 2 kids and paying £180 in childcare costs the payments are an unbelievable £6463 per year. Just been on the calculator on HMRC site.

If you both earn 15K and can't afford a mortgage and want kids?

How about those poor people that earn avg wage and fancy starting a family? .... Simple Lib-dem answer would be to raise the tax code to 10K...Perhaps a good policy...and BONUS ditch another labour quango that causes stress,...Tax Credits. RESULT!

With unemployment at record high's... finding an stay at home mum, that's happy to look after your kids during the day while you go to work for £50 untaxed income a week, might seem like a good idea although... you would no longer need 5 well paid public servants to do a judge of character check.

Hell you could still give your neighbours kids a lift to football on Sunday's without getting your DNA /Criminal record checked.

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In the context of this thread perhaps the point is that people who shouldn't need it have become dependent on it.

Remember Clegg wanted to cut it for income over £25,000. 2 parents both working, 2 kids, £180 a week childcare = £8,028 a year.

I would agree that many will be dependent on this money, they shouldn't but our high cost economy has made parents dependent on state handouts.

As I've already stated this many has been taken into account for mortgages, it was rash stupidity of the banks to do so but greed got the better of them.

Rebalancing this going to be very difficult.

The gamble for the govt is if you start reducing the safety net people might take the decision not to work just at the point you need them to keep working to pay taxes.

Labour have screwed the new govt nicely on this.

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that depends on whether you think a falling population is good for the economy and healthy interest rates of the kind beloved by prudent savers.

I've been there and done it.

We couldn't afford children and a mortgage, we decided which was more important, so had kids and rented.

Over a period of time my earnings increased until we reached the point we could afford to buy, it took a long time.

No childrens tax credits then, I believe Labour introduced them circa 2003, and no assumed entitlement to own a house either.

Life can be tough, some are about to find that out, possibly for the first time.

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£30k doesn't get you anywhere especially if you live in the south east! If you are on £30k you are effectively classed as very poor.

That would be an inflation expectation! Avg UK wage 25K.

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If you cannot afford to look after kids then don't have any. It is about time child tax credits are cut, it should stop the chavs farming kids for money.

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I despise the benefits culture, but I can't help thinking the screws should really be being tightened on the people at the other end, the fat cats in the private and public sector that have gotten exponentially fatter as a results of the last government. After all, it's all these multiple home owning types that mean it is necessary to give those earning an average salary handouts, because social mobility suffered so badly over the last decade that government hand outs are the only solution.

Edited by the.ciscokid

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that depends on whether you think a falling population is good for the economy and healthy interest rates of the kind beloved by prudent savers.

There's nothing like a good bit of social engineering for Team Labour.

If people want or don't want kids, that's up to them. Ensuring kids aren't left in poverty is one thing, but bribing parents (with their kids' future taxes) to keep the ponzi scheme going is another.

Edited by Traktion

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Why can they not just get rid of it all together, and raise the income tax threshold at the bottom of the scale. Give people a reward for working, if you have children or not. Child benefit is like a citizens wage for those under 16 or 18 or whenever it lasts till, perhaps controversially raise this to say £30 per week for all under 16s. Roll housing benefit and income support/jobseekers allowance into one standardized payment of £150 per week for those working 0-10 hours a week, with £75 for all those who work 10-20 hours a week, nothing for those above 20 hours. Anyone earning over 10,000 gets nothing regardless of hours. I am sure this would save a lot of money

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that depends on whether you think a falling population is good for the economy and healthy interest rates of the kind beloved by prudent savers.

Keep it in your pants. What about the children who are not born to taxpaying couples because those couples have to compete for accomodation with the indolent and can't afford to start families? People who get on their bikes are just as lusty as your privileged couch potatoes.But it's all academic, ya? Shoot the economists. The birth rate will explode!

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I despise the benefits culture, but I can't help thinking the screws should really be being tightened on the people at the other end, the fat cats in the private and public sector that have gotten exponentially fatter as a results of the last government. After all, it's all these multiple home owning types that mean it is necessary to give those earning an average salary handouts, because social mobility suffered so badly over the last decade that government hand outs are the only solution.

+1 Screws should be tightened at both ends (CGT at effective PAYE would do the trick! But think the lobbiest will win over at the budget on the 22nd and a somewhat washed down from the Lb-Dem proposal)

The people in the middle carried the cost for way to long.

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  • 140 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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