Retirement...when, how old and how much??

[halfmist]

The problem with CGT is it incentives the wrong behaviours. PAYE employees and small business owners have the same rules around how much you can contribute into a pension tax free per year.

Any tax breaks need to come via a separate mechanism and they should always be focused towards the very early stages of a new business (everyone has to start somewhere) and encouraging growth of SMEs by taking on employees who are subject to PAYE, not maintaining established "one man band" business, with the wife, cat and budgie listed as directors. As in reality they add no more value to the overall economy than a PAYE employee.

This would obviously need rules to prevent people exploiting the system by setting up multiple businesses or recycling businesses (disolving and then reopening under a new business name) to maintain the tax break.

From a UK point of view, its not a problem of people not setting up businesses, its our inability to grow and nurture SMEs to become large national and multinational companies and preventing them being swallowed up by other multinationals due to lack of investment.

The danger is, taking on employees with all the rules and regulations plus minimum wage etc in a new business venture is a recipe for disaster.
As the vast majority of new businesses fail in the first two years my advice to clients was always keep your overheads to a minimum in the early years, if you can work from home do, if it’s in the same line of business as you did previously through PAYE, try and keep on good terms with your past employer.
With a good relationship they may possibly give you some part time work whilst you ease yourself in.

 

[oakiecokie]

National Trust have a similar rule, which is probably more pertinent to the FOC's on here ;)

At my age its more like the fucking National Truss.

 

[Kompany Car]

The danger is, taking on employees with all the rules and regulations plus minimum wage etc in a new business venture is a recipe for disaster.
As the vast majority of new businesses fail in the first two years my advice to clients was always keep your overheads to a minimum in the early years, if you can work from home do, if it’s in the same line of business as you did previously through PAYE, try and keep on good terms with your past employer.
With a good relationship they may possibly give you some part time work whilst you ease yourself in.

Im not advocating taking on employees in the very early stages but likewise tax breaks shouldn't be given to those who after 5yrs plus of doing business remain as one man bands. It should be given to those willing to take risk by expanding and increase employment.

 

[Citizen of Legoland]

Know how you feel.

I’ve been bumping my pension like mad these last few years. So much so that I nearly went over the £40k limit in one year. All because I stopped making payments between 1997 & 2005, bit stupid but I was just so skint at the time but it shows how quickly the fund can fall behind schedule. Plus when setting it all up, everyone puts state retirement age when really people should be planning to retire at 60 for personal pensions when they’re 25 or whatever, to give people flexibility later on. I’m lucky I made some gambles that paid off work wise, so I can boost it but I’ll still only be in the avg category for pension income when I take it.

If I get there.

 

[halfmist]

Im not advocating taking on employees in the very early stages but likewise tax breaks shouldn't be given to those who after 5yrs plus of doing business remain as one man bands. It should be given to those willing to take risk by expanding and increase employment.

Fair point but the risks associated with standing on your own two feet rather than relying on others to take the risk, doesn’t suddenly end after x years.
It stays with you for the whole time one is self employed, your only as good as your last job.

 

[Kompany Car]

Well that doesn't apply to me. I run a small buiness and employ people and all I've seen the last 20 years is progressively higher taxes and more red tape and paperwork and when it's just you dealing with all the issues that go with running a small business you wonder why you bother sometimes?

Especially when the biggest business's pay less tax proportionally and even then still don't pay their fair share as they have the ear of governments including ours.

Then it shows that the current system is not working. That said there must be a reason why you are still in business.
As regards tax and large multinational companies, it needs a serious review as does the ability of some large companies to operate in an almost monopolistic manner.

 

[Blue Maverick]

For those retiring older I wonder what they are going to do, even the fittest 67/68 old isn’t going to be sky diving etc, insurance premiums would be sky high, yes there are holidays but look at what at they cost these days, Brexit will have fucked up many wanting to live in the sun into old age as well. Unfortunately they want to work most of us to the grave.

 

[halfmist]

Then it shows that the current system is not working. That said there must be a reason why you are still in business.
As regards tax and large multinational companies, it needs a serious review as does the ability of some large companies to operate in an almost monopolistic manner.

I think the reason why he is still in business is probably because he needs to make a living.
The self employed unlike the employed cannot just up sticks, walk away from commitments, straight in to something else.
That is partly the reason why they are allowed to work under different tax arrangements.
it is also unrealistic to say the UK government can deal single handed with the tax treatment of multinationals, it just ain't going to happen.
they have tried to get other countries to agree to changes but it just falls on deaf ears.
Also just look what's happened as a direct result of the corporation tax hike.
Astra Zeneca are taking 2000 jobs destined for Macclesfield over to Ireland where the Corporation Tax rate is only 12.5%.
Monopolies are an essential part of life today, without them there would be no Microsoft, Apple, Google etc and no Blue Moon.!!!

 

[Churchlawtonblue]

Then it shows that the current system is not working. That said there must be a reason why you are still in business.
As regards tax and large multinational companies, it needs a serious review as does the ability of some large companies to operate in an almost monopolistic manner.

Well I'm still in business as clearly I earn a bit of money and still need to to support my family, I also have a responsibility to my employees and it's the only thing I know . But none of that doesn't mean it's not gotten an awful lot harder the past few years.

 

[skillman]

For those retiring older I wonder what they are going to do, even the fittest 67/68 old isn’t going to be sky diving etc, insurance premiums would be sky high, yes there are holidays but look at what at they cost these days, Brexit will have fucked up many wanting to live in the sun into old age as well. Unfortunately they want to work most of us to the grave.

Because of my job, I speak to people quite a bit about retirement plans and provisions for it and it's a common occurrence that people are scared shitless to touch their pension because they've spent years building it up.

It's a massive shame really that people feel the need to carry on working even when their pension and income in retirement is near-enough sorted. Seen it too many times where it's been left too late and had they (if they could) retired a couple of years earlier then they could've got so much more done.