Why is my family taxed so heavily compared to others?

Posted in: Viewpoints

From a mother:


Why are we taxed so heavily compared to other families on the same household income?

My husband is a fantastic father to our children,  hard-working, decent earner (it took time to get there), supportive, loving, and fully committed to supporting our family through paid employment and in other ways.  We support one another in fact.   It’s called inter-dependence, in not just financial ways,  but emotionally and practically.  We also have older relatives who rely on us.   We know other families who are, for the most part, also ‘one-main-income’ couples like us   (or one and a half jobs quite often) –    and sometimes it’s mum in work and the dad is at home taking care of stuff with the children.   Whatever works well for them is the right thing.

Generally most families do the best in their own unique circumstances, given the opportunity to divide paid work and care without hindrance,  with family well-being and stability top on the list of our priorities.  

It’s pretty clear there’s  no ‘perfect’  or ‘modern’  way to ”do family”  or ” to be a family”  that is superior to other ways.   It’s surely up to the family how they manage work and care  – they should be free to make decisions that suit their family lives as long as they are responsible, work and earn an income,  provide for and care properly for their children etc.      So why does HMRC tax our family more than others?

Clearly the govt doesn’t like the way we run our family –  and I’m  not sure why that is.  I can only think they want me  – as mum – to be in even more paid work and the children into Ofsted inspected childcare.   The squeeze in taxation means we often struggle to make ends meet.  My husband works hard but we’re not allowed to keep as much of those earnings as others are allowed to keep. 

It’s a puzzle to me that my husband is treated so incredibly punitively in our tax regime in the UK.   To be clear  – he currently pays almost double the tax that other families on similar joint household incomes pay.   In fact he also pays as much tax as an old colleague/friend who to date has no extra responsibilities for children whatsoever –  someone who just has himself to take care  of.  The point is that we are practically the only country to not factor into income tax, the level of responsibilities someone has for dependents.   No wonder families struggle in the UK when they’ve got extra little people to feed, clothe and put a roof over their heads.  

Some couples on about the same income we’re on and who have no children to care for actually pay LESS tax than we pay as a family.  That’s incredible.   This wouldn’t happen if we had a genuinely pro-family friendly system,  like they seem to have elsewhere. 

I recently lost my child benefit,  despite the fact that I work in very low paid work,  which is nevertheless rewarding work – and despite the fact that I don’t cost the govt anything in taxpayer funded childcare subsidies.  Other people I work with have kept their child benefit despite earning a lot more ( management level) and despite having overall higher family income and despite claiming help with their childcare expenses – how can that be right?  Why pick on my children’s father for more tax?  Why ignore the work I do caring for our children, saving the state quite a bit of money.

My husband was recently expected to pay a higher income tax charge –  something which I should be paying back (I feel)  as child benefit was payable to me – but I used it for the children.  After all it was universal.   And although some people say we don’t ‘need it’  on more than £50/60k in fact it’s interesting that the govt  will be offering tax relief on childcare on joint incomes of up to £300,000 –  so that argument doesn’t really hold. 

We are told that we are assessed as individuals but then, strangely,  they look at the couple situation to take more money away from our family  –  whilst other much higher income parents are offered extra single person’s non taxable allowances,  they pay overall far less tax, retain their child benefit on higher family incomes and are offered more and more childcare assistance too.   

If HMRC wants to tax independently then why is my husband faced with tax bills and tax charges for my child benefit?  Why has he received a letter to return money that was payable to me?

Who is going to deal with this strange system and does any other country have this kind of mess where the govt can’t decide whether or not they really back the idea of ‘family life’ and whether or not they feel families bringing up children need some degree of support for the considerable costs involved,  without being taxed to high heaven!!

Why direct so much more money at childcare,  whilst not allowing families to offset the enormous costs of ‘home-care’  against earnings?   The second parent who puts aside his/her entire income in order to provide care at home has considerable ‘costs’,   so the last thing the family needs is a punitive taxation regime that ignores not only the needs of dependents but also the contribution made by the ‘hard-working’  caregiving parent.  Not to mention the fact that the main earner is supporting not only children,  but also the children’s main adult carer.

It’s a sad thing to say – but I shall be encouraging my children not to buy into the current system and suggest they keep well away from forming partnerships that will be held against them in tax just because they live with their children’s other parent as a ‘family’.   

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