Quote:
Originally Posted by dude69
hmm, thought occurs to me that when he says threshold, he means that he has actually cut the band by TWELVE hundred pounds.
That would indeed mean you start paying higher rate tax that much sooner.
It's a politician's use of language. The higher-rate is a 'band'. NICs use the word 'threshold'. Threshold means the income level at which you start paying it i.e. PA + Higher Rate Band.
So the band has actually been shrunk to £34,800 from £36,000.
What does this mean for us?
It's a tax increase. We will pay tax on our dividends £600 sooner.
So we actually end up paying £135 MORE tax per year.
Thieving Liemour b@stards
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I agree, what you says sounds right about the threshold.
But it is surely £135-£120 saving from higher PA = £15 tax rise.
Assuming your salary is > (new) PA.