CliveH Posted January 18, 2014 Posted January 18, 2014 Really? based upon your posts you come across a being an obsessive poor loser. Higher league? - Yeah - you keep telling youself that Frank! (lol) (lol) (lol) Higher league of being Dull maybe I quite like being obsessed over tho'
Guest Had Enough Posted January 18, 2014 Posted January 18, 2014 CliveH - 2014-01-18 5:55 PM Really? based upon your posts you come across a being an obsessive poor loser. Higher league? - Yeah - you keep telling youself that Frank! (lol) (lol) (lol) Higher league of being Dull maybe I quite like being obsessed over tho' But at least I was able to understand Dave's point, which you clearly were not! ;-) ;-) But really Clive, I thought that you'd have learned that starting all these personal insults just because you've lost the argument isn't a good policy with me. Perhaps you've forgotten what happened the last time? But if you want to open the door Clive go ahead and we'll trade career successes and lifestyles again. How is that 20 year old land Rover that you drive doing Clive? And have houses in Willow Avenue hit the million mark yet? (lol) (lol) Now be a good boy and address the question of how you weren't able to understand Dave225's theory. Do not try to divert by these rather nasty personal insults or you may end up being flattened again! ;-) Some people never learn! (lol) (lol)
CliveH Posted January 19, 2014 Posted January 19, 2014 Had Enough - 2014-01-18 6:45 PM CliveH - 2014-01-18 5:55 PM Really? based upon your posts you come across a being an obsessive poor loser. Higher league? - Yeah - you keep telling youself that Frank! (lol) (lol) (lol) Higher league of being Dull maybe I quite like being obsessed over tho' But at least I was able to understand Dave's point, which you clearly were not! ;-) ;-) But really Clive, I thought that you'd have learned that starting all these personal insults just because you've lost the argument isn't a good policy with me. Perhaps you've forgotten what happened the last time? But if you want to open the door Clive go ahead and we'll trade career successes and lifestyles again. How is that 20 year old land Rover that you drive doing Clive? And have houses in Willow Avenue hit the million mark yet? (lol) (lol) Now be a good boy and address the question of how you weren't able to understand Dave225's theory. Do not try to divert by these rather nasty personal insults or you may end up being flattened again! ;-) Some people never learn! (lol) (lol) Well it did not take long for your true colors to show through Frank It really does underline the degree to which you suffer with your problem that you think attacking the “player rather than the ball” is appropriate behavior. What happened before was that I stated that you did not behave or exhibit knowledge that I have found to be typical in a successful person. Your latest post does nothing to dissuade me of that opinion. Whatever success you have found in life – it has clearly not made you a happy or stable personality. Once again I find myself feeling really sorry for you if you have such an inferiority complex that you have to put in writing that you are somehow in a “higher league” - seriously – how sad is that! Now your obsession is such that you act like a stalker. Once again do you think it appropriate for you to have to revisit old perceived slights and perceived "wins" to somehow give your flagging ego a boost? Your obsession with me is flattering – I am truly overwhelmed that someone of your lofty status who by your own words sees themselves in a higher league than lowly little me – is prepared to give up their precious time to tell me where I am going wrong. I am almost moved to tears with the emotion of it all. I am so grateful I fear I am filling up here………………… Such tears of laughter! ;-)
Guest Had Enough Posted January 19, 2014 Posted January 19, 2014 CliveH - 2014-01-19 6:31 AM Had Enough - 2014-01-18 6:45 PM CliveH - 2014-01-18 5:55 PM Really? based upon your posts you come across a being an obsessive poor loser. Higher league? - Yeah - you keep telling youself that Frank! (lol) (lol) (lol) Higher league of being Dull maybe I quite like being obsessed over tho' But at least I was able to understand Dave's point, which you clearly were not! ;-) ;-) But really Clive, I thought that you'd have learned that starting all these personal insults just because you've lost the argument isn't a good policy with me. Perhaps you've forgotten what happened the last time? But if you want to open the door Clive go ahead and we'll trade career successes and lifestyles again. How is that 20 year old land Rover that you drive doing Clive? And have houses in Willow Avenue hit the million mark yet? (lol) (lol) Now be a good boy and address the question of how you weren't able to understand Dave225's theory. Do not try to divert by these rather nasty personal insults or you may end up being flattened again! ;-) Some people never learn! (lol) (lol) Well it did not take long for your true colors to show through Frank It really does underline the degree to which you suffer with your problem that you think attacking the “player rather than the ball” is appropriate behavior. What happened before was that I stated that you did not behave or exhibit knowledge that I have found to be typical in a successful person. Your latest post does nothing to dissuade me of that opinion. Whatever success you have found in life – it has clearly not made you a happy or stable personality. Once again I find myself feeling really sorry for you if you have such an inferiority complex that you have to put in writing that you are somehow in a “higher league” - seriously – how sad is that! Now your obsession is such that you act like a stalker. Once again do you think it appropriate for you to have to revisit old perceived slights and perceived "wins" to somehow give your flagging ego a boost? Your obsession with me is flattering – I am truly overwhelmed that someone of your lofty status who by your own words sees themselves in a higher league than lowly little me – is prepared to give up their precious time to tell me where I am going wrong. I am almost moved to tears with the emotion of it all. I am so grateful I fear I am filling up here………………… Such tears of laughter! ;-) Honestly Clive, you really are dim! But let's address one thing first. I haven't debated with you for weeks, hardly the action of a stalker! When I do decide that you need correcting and post a perfectly sensible response to your inability to understand Dave225's argument you immediately show your paranoia by making very nasty personal attacks on me, rather than addressing the point. You carry on in this vein from then on, so as I said, you opened the door, and if I feel obliged to point out that I'm a successful businessman whilst you're a not-very-successful IFA, it's on your own head! You're so conceited and arrogant that you couldn't conceive that Dave and I had a point and that you must be right, that you totally ignore Dave's main point, which is that he's referring to the money SHE put in and not the total pot! You just couldn't grasp that! But now, let's show everyone what a clever IFA you are! If a Mrs Dave, who earns a modest salary of say £20K, decides that she'd like a pension and asks her employer to put £1000 a year into a scheme, rather than take it in salary, these are the figures. The whole £1000 will go into her pension. It will cost her £700 as she would pay £200 tax and £!00 employee's NI if she took it in salary. I'm rounding NI to 10% for illustrative purposes and to make the sums easier for you. After 30 years there will be £30K in the pot (probably a lot more with fund growth but we'll ignore that to keep life simple). With most providers fund growth will certainly outweigh charges anyway. Are you with me so far? There is £30K in her pot but it's cost her £ 30 x £700 or £21K. So Mrs D retires and takes a tax free lump sum which I believe can be 25% so that's £7500 leaving a pension pot of £22.5K. This means that from the £21K she's paid in she is now owed £13.5K having already taken £7.5K of it. Her remaining pot of £22.5K now pays out 5% a year or £1,125. In twelve years she will have recouped her total investment in the pension! And of course Dave's other point about pensions, with which I totally agree, is that they can't be spent. Encourage people to save in ISAs and you just know what will happen when they near retirement age and fancy a new motorhome or earlier in life when the wife insists on a new kitchen like her sister's! But this is the difference between you and me Clive - Dave225 makes a valid point about how long it will take his wife to get her investment back and I think: "It's clear from this man's post that he knows what he's talking about, let me think about this a bit". You do just the opposite - I'm CliveH this forum's very clever IFA so I'm right and he must be wrong and in you go, guns blazing, and make a right idiot of yourself! So there you are Clive, he was right, 5% pays it back in 12 years, 6% even sooner! Finally, try for once to address the point instead of this cheap tactic that you use of just denigrating your opponent. That way I may not have to point out that you're really not that successful after all, despite all your posturing on here! But we all know that this is a diversion - you were wrong and rather than admit it (see your RM squirming) you'll divert and divert! Ps Methinks you've just been flattened again! (lol) (lol) (lol)
CliveH Posted January 19, 2014 Posted January 19, 2014 Oh dear! Methinks you protest too much Frank. "If a Mrs Dave, who earns a modest salary of say £20K, decides that she'd like a pension and asks her employer to put £1000 a year into a scheme, rather than take it in salary, these are the figures. " And then we have what the HMRC says 'Usually your employer takes the pension contributions from your pay before deducting tax (but not National Insurance contributions). You only pay tax on what's left. So whether you pay tax at basic, higher or additional rate you get the full relief straightaway.' http://www.hmrc.gov.uk/incometax/relief-pension.htm But you say:- The whole £1000 will go into her pension. It will cost her £700 as she would pay £200 tax and £!00 employee's NI if she took it in salary. I'm rounding NI to 10% for illustrative purposes and to make the sums easier for you. But the reality is the employer:- ".......takes the pension contributions from your pay before deducting tax (but not National Insurance contributions). As I say - oh dear! Take that 10% advantage that you think is there but isn't out of your calculations and you get back to the calculation that i originally stated !!! (lol) (lol) (lol) (lol) And here is another link to a site that shows you are wrong Frank! this is what it says:- "Your employer may take pension contributions from your pay before they deduct Income Tax. This is a ‘net pay arrangement’. You don’t pay Income Tax on your pension contributions but you pay National Insurance on your pension contributions. Ask your employer if a net pay arrangement applies to your workplace pension." http://www.nidirect.gov.uk/tax-relief-on-pension-contributions ........................................... What a plonker you are Frank The data is out there all over the place - and you STILL get it wrong! But you do throw up an interesting point. If Dave's wife had said to her employer that she wanted not to make the contribution in the normal way - but asks her employer to reduce her salary via "salary sacrifice" to £19,000 and then getting the employer to make an employers contribution then the employers NIC at 13.8% on that £1000 can be paid into the scheme. So if it is this that you have tried to research Frank - then nice try but you have part of the NIC 'kicker" at the wrong rate! - DOH!!!! We are doing a lot of these for people who earn too much to now be eligible for child benefit. It is a simple matter to do - BUT - it does involve the employer in a fair bit of "negotiation" with the Revenue - the scheme has to be registered and the employee has to have an audit trail of requesting such a tax avoidance scheme. They have to enter it on their tax return as such a scheme But keep trying Frank! You must be learning a lot!
CliveH Posted January 19, 2014 Posted January 19, 2014 I have just re done your calculation Frank but with the Employees NIC not wrongly included as you had mistakenly suggested and it looks like this The whole £1000 will go into her pension. It will cost her £800 as she would pay £200 tax but she would still have to pay £100 employee's NIC After 30 years there will be £30K in the pot (probably a lot more with fund growth but we'll ignore that to keep life simple - agreed). With most providers fund growth will certainly outweigh charges anyway – again, agreed. (But do remember that Dividend Growth within the pension is now taxed thanks to Gordon Browns first stealth tax - so the reality is not as good as this calculation would indicate here. - but this tax applies to Investment ISA's so there is a level playing field here so we can discount it for this calculation) There is £30K in her pot but it's cost her 30 x £800 or £24K. So Mrs D retires and takes a tax free lump sum which I believe can be 25% so that's £7500 leaving a pension pot of £22.5K. This means that from the £24K she's paid in she is now owed £16.5K having already taken £7.5K of it. And the figure comes out at 14.6 years.
Guest Had Enough Posted January 19, 2014 Posted January 19, 2014 CliveH - 2014-01-19 9:42 AM I have just re done your calculation Frank but with the Employees NIC not wrongly included as you had mistakenly suggested and it looks like this The whole £1000 will go into her pension. It will cost her £800 as she would pay £200 tax but she would still have to pay £100 employee's NIC After 30 years there will be £30K in the pot (probably a lot more with fund growth but we'll ignore that to keep life simple - agreed). With most providers fund growth will certainly outweigh charges anyway – again, agreed. (But do remember that Dividend Growth within the pension is now taxed thanks to Gordon Browns first stealth tax - so the reality is not as good as this calculation would indicate here. - but this tax applies to Investment ISA's so there is a level playing field here so we can discount it for this calculation) There is £30K in her pot but it's cost her 30 x £800 or £24K. So Mrs D retires and takes a tax free lump sum which I believe can be 25% so that's £7500 leaving a pension pot of £22.5K. This means that from the £24K she's paid in she is now owed £16.5K having already taken £7.5K of it. And the figure comes out at 14.6 years. So not twenty years then Clive eh? ;-) But why can't she ask her employer to set up a pension scheme in her name and just pay her £1000 less? That way she saves NI as well. It's not illegal and if it's not illegal that's what I'd do. I'd also give her an extra hundred quid or so into her pension as I'd be saving employer's NI of 13.8% Payback would then be about ten years! Anyway, I'm glad that you've learned something and now accept that it's nowhere near 20 years!
Tracker Posted January 19, 2014 Posted January 19, 2014 Had Enough - 2014-01-18 6:45 PM But if you want to open the door Clive go ahead and we'll trade career successes and lifestyles again. How is that 20 year old land Rover that you drive doing Clive? And have houses in W........ A......... hit the million mark yet? I fail to see how the above has anything to do with pensions? It is however symptomatic of your usual tactics of plunging the depths of history to throw something - anything - else into the argument to divert it into yet another personal slanging match rather than discuss the topic. The vehicles we choose to drive bear no relationship to income, wealth or perceived status, and to print such a broad clue to any members location is not what we expect from a responsible member and is surely worthy of censure by the moderators? It was an interesting subject under discussion with differing views being posted - until once again you tried to destroy it by personalising it. Your response will be the measure of what sort of a man you are.
Guest pelmetman Posted January 19, 2014 Posted January 19, 2014 Had Enough - 2014-01-18 6:45 PM But if you want to open the door Clive go ahead and we'll trade career successes and lifestyles again. How is that 20 year old land Rover that you drive doing Clive? And have houses in Willow Avenue hit the million mark yet? (lol) (lol) I wonder if Frank has an inkling of how his ego looks to other people when written down? :-S............I guess he assumes he's someone to be envied?.............and to some I don't doubt he is *-)........ But then fortunately we're not all like Frank B-)...........
Guest Had Enough Posted January 19, 2014 Posted January 19, 2014 Tracker - 2014-01-19 12:41 PM Had Enough - 2014-01-18 6:45 PM But if you want to open the door Clive go ahead and we'll trade career successes and lifestyles again. How is that 20 year old land Rover that you drive doing Clive? And have houses in W........ A......... hit the million mark yet? I fail to see how the above has anything to do with pensions? It is however symptomatic of your usual tactics of plunging the depths of history to throw something - anything - else into the argument to divert it into yet another personal slanging match rather than discuss the topic. The vehicles we choose to drive bear no relationship to income, wealth or perceived status, and to print such a broad clue to any members location is not what we expect from a responsible member and is surely worthy of censure by the moderators? It was an interesting subject under discussion with differing views being posted - until once again you tried to destroy it by personalising it. Your response will be the measure of what sort of a man you are. Well Richard, if you'd read properly you'd know why I take this stance. Every time I answer one of Clive's posts he accuses me of being obsessed, a stalker and having a mental problem. This time he also called by extremely dull as well. I have told him many times that if he continues this stance that I will also highlight the differences in our career successes as a way of proving that I'm far from dull! Despite being asked to desist in this rather bullying method of casting doubt on my sanity he continues. Please read this thread. I pointed out to him where I thought he'd made a big mistake in reading John225's point and his very first response to me was in just the vein I describe. And as for plunging the depths of history, that's just what he does when he accuses me of stalking him and being obsessed with him. This thread is the first time I've debated with him in many weeks - is that the action of a stalker or someone who is obsessed? Come on! And I'll tell you now Richard, the next time he accuses me of being ill and needing help, which he is always doing, I shall again point out that this person he accuses of being mentally unfit is more successful than he is, has a much bigger business than he has ever had and that he is what he really is, a not-too-successful small town IFA. The answer is in his hands - even you have never stooped to the depths that he does in describing me and you're not exactly my greatest fan. He has been warned, again and again and again! Edited to say: This is a typical comment from a post higher up this thread: 'Frank - when it comes to me - you would take the contrarian view simply out of spite. You do this - I think - because you have a problem. Sadly you do not seem to be any better ' I disagreed with Clive because I thought he was wrong in his rubbishing of Dave225's point about his wife's repayment period. And it turns out I was right, it is nowhere near twenty years as Clive has insisted! But it appears that in future, if ever I disagree with Clive about anything it will be spiteful and obsessive and stalking! And remember, this is the first time I've entered a debate with him in about two months! I don't think that I have a problem, I think he's a bit paranoid about me!
Tracker Posted January 19, 2014 Posted January 19, 2014 I see no reason to keep quoting previous postings in full as it gets repetitive and boring but below is your first entry on this thread in response to a posting from Clive that had no personal antagonism in it whatsoever. " Here's a clue Clive, read it carefully again. I can understand why it's 11 years (approximately) and I know nothing about pensions and investments, leaving that to my advisor, a very good one who recommended that I buy RM shares! " Followed of course by the obligatory exclamation mark so that we all know that is is a joke, but stated with the kind of barbed reference to a previous issue that seems irrelevant in this context. The inevitable consequence of a provocative - one might even call it snide - posting like that is that it gets the response it deserves and, as a result, here we go again - another useful thread devalued by tit for tat insults and point scoring. Please be aware that your constant referral to your own perceived success in an unrelated business does nothing to make your views on financial matters, which you state are not your field of expertise, any more credible to others and is, with respect, somewhat crass and very boring. Many on here have had successful lives and careers in many different ways but nobody else keeps banging on about their own perceived status and boring everyone else because it is irrelevant in the context of this forum. I see no evidence of Clive using past history on this topic until you elected to introduce it for your own ends, so with respect, you using that as a reason for your initial posting on this topic simply does not wash. Even in this polite, for which I thank you, response to me you are unable to reply without chucking more snide at Clive, and yet it is always you that accuses others of snide chucking, why is that Frank? I would not be so bold as to call you mentally ill but because, unlike yourself and a couple of others on here, I do not make any assertions about the character and personality traits of someone whom I do not know personally because the snapshot of a person one sees on here is nothing like the same as the real person in real life. That said however, with respect, you do seem to have one heck of an attitude and ego issue. You may not appreciate this but whilst, as you say, I am not your biggest fan, neither do I have any axe to grind and I do not raise any previous threads or spats or anything else derogatory other than in response to a snide, or inaccurately based on false presumptions, attack on me first. It has been said before, ad nauseam, but if we could all stick to responding to the message and not allow personal feelings about the messenger to cloud our response this forum would be a much more harmonious place. You do have a wealth of experience in many fields and there are times when you offer sound help to others and wouldn't it be better to have people posting a 'thank you Frank' rather than this continual 'mines bigger than yours' attitude? By all means disagree with Clive, with me, with everyone else if you wish, and let us debate the issue but without personalising it, and whilst I can't speak for anyone else I can assure you that I will continue not to attack you or anyone else without what I see as personal provocation aimed directly at me first.
CliveH Posted January 19, 2014 Posted January 19, 2014 Had Enough - 2014-01-19 12:30 PM CliveH - 2014-01-19 9:42 AM I have just re done your calculation Frank but with the Employees NIC not wrongly included as you had mistakenly suggested and it looks like this The whole £1000 will go into her pension. It will cost her £800 as she would pay £200 tax but she would still have to pay £100 employee's NIC After 30 years there will be £30K in the pot (probably a lot more with fund growth but we'll ignore that to keep life simple - agreed). With most providers fund growth will certainly outweigh charges anyway – again, agreed. (But do remember that Dividend Growth within the pension is now taxed thanks to Gordon Browns first stealth tax - so the reality is not as good as this calculation would indicate here. - but this tax applies to Investment ISA's so there is a level playing field here so we can discount it for this calculation) There is £30K in her pot but it's cost her 30 x £800 or £24K. So Mrs D retires and takes a tax free lump sum which I believe can be 25% so that's £7500 leaving a pension pot of £22.5K. This means that from the £24K she's paid in she is now owed £16.5K having already taken £7.5K of it. And the figure comes out at 14.6 years. So not twenty years then Clive eh? ;-) But why can't she ask her employer to set up a pension scheme in her name and just pay her £1000 less? That way she saves NI as well. It's not illegal and if it's not illegal that's what I'd do. I'd also give her an extra hundred quid or so into her pension as I'd be saving employer's NI of 13.8% Payback would then be about ten years! Anyway, I'm glad that you've learned something and now accept that it's nowhere near 20 years! I actually said 17 years and do not forget frank that whilst we are taking into account the tax relief on the contributions - the figure of 14.6 years is achieved by looking at the GROSS pension payments and comparing it to the NET contributions. And now you have just caught up with my Salary Sacrifice Post! - You clearly have not read - or not understood my previous post Please read this earlier post that outlines the way such schemes must be set up. Salary Sacrifice is indeed a possibility - but I would suggest it is not viable for someone on a salary as low as £20K. The Employer needs to alter the payroll system AND register the scheme with HMRC. Again - I repeat :- Try working out the payback period assuming Mrs Dave has to pay Tax on the £1125 that she receives If you do then the pay back period is far more than the 14.6 years I cited. In fact Frank - why don't you work it out for yourself? BRT on £1125 would be £225 and so the net income would be £900. I await your calculations with interest! Frank - I am trying to be kind to you in my citing the gross income and then comparing it to the net contributions - and even then the 11 years figure is untenable. If you have a 5% annuity then the pay back on the MONEY THAT GOES INTO THE ANNUITY is 100% divided by 5% = 20 years. If you have to pay tax on that income then you have a far longer payback period. If you factor in the Tax Free Cash it does equate back to the 17.7 r years I cited. Nice try Frank but once again your lack of knowledge of even the basics of business leads me to question your expertise in business. Sorry Frank but in 33 years and dealing with all types of business from the small shopkeeper to large Corporations - I have never met anyone in charge of or near the top of those business that consistently makes the mistakes you do. Like I said earlier - whatever success you have achieved - you seem to have achieved it with a level of genuine ignorance of the basics that I find very surprising indeed. In fact I would say that your genuine ignorance is only exceeded by your belligerence As for learning anything from you - I have certainly learnt how NOT to behave.
Guest Had Enough Posted January 19, 2014 Posted January 19, 2014 Make up you mind Clive, I thought you'd settled on 14.6 years payback time higher up! I doubt that she'll pay any tax retiring on such a small pension, even if you add the state pension to it. But you still can't get away with the fact that you simply hadn't understood Dave's point, that the time to repay that he quoted was based on what she'd paid in, not the entire pot. This was proven by your insistence on asking him which provider gave such large annuities - he's never said that! And I await with interest Dave's response as he seems to have a much more realist approach to finance than you. But to address your other insults, I pay people to advise me on pensions etc. I'm a retailer and am good at it as my record shows! You totally amazed me with your lack of knowledge on retail premises and rents when you castigated me for not buying my latest branch in Liverpool and putting it in a SIPP. You seemed totally unaware of the fact that such properties are not available for sale and that the cost would be impossible at well over a million. You clearly, despite your claim to have dealt with large corporations, have no experience of my level of retailing, giving the impression of only having dealt with small shopkeepers in secondary locations where you can buy properties at low prices. So you see Clive, the reason I'm successful is that I know about retailing. I know about where to site my shops, I know when renting is a far more sensible option than buying and I know about marketing and advertising. I know little about pensions and investments as I pay people to advise me on those. But I do have a brain, and when someone says 'To pay back the contributions SHE has made, I can work out what he meant, which you clearly didn't! But just think Clive, if I was as clever as you I wouldn't just have ten shops now, I'd have three hundred and be even richer than I am! :-) What I can't understand though is if you are so clever how is it that you never got beyond being a one-man band IFA? Bit of a mystery there for such a business genius eh? ;-)
CliveH Posted January 19, 2014 Posted January 19, 2014 Still the snide comments eh Frank And yet again you decline to answer my simple question that would underline just how wrong you are. Really - and MD of a successful company that has forgotten that NIC is applied on pension contributions. Come on frank - as i said - I was being kind! £24K NET contributions - minus the £7500 TFCon the fund of £30K = £16,500 If you look at the GROSS income of £1125 (5% on an annuity pot of £22,500) then pay back is indeed 14.66 years (£16,500 / £1125 = 14.66 years. But as you can see we are mixing NET and GROSS which is not the proper way of doing the calculation but to be honest - I felt 14.66 was more than enough to make the point. So tell me Frank - if we wanted to do the calculation properly and look at the NET to NET figures then what would be the number of years to return then Frank? (Let me give you a clue - it is £16,500 NET CONTRIBUTION after the tax free cash has been taken, divided by the NET income which is £1125 less 20% Income Tax = £900 So £16,500 / £900 = ???????? Hint - it is just over 18 years Frank 18.33 r years to be exact. 8-)
CliveH Posted January 19, 2014 Posted January 19, 2014 Tracker - 2014-01-19 4:19 PM Some things will never change! No sadly - it seems they won't. It is a shame tho - because when I was born God graciously provided me with an Ar$ehole - but it seems Frank wants to be a second one for me. It is nice of him but one is really enough. B-)
Guest Had Enough Posted January 19, 2014 Posted January 19, 2014 CliveH - 2014-01-19 4:28 PM Still the snide comments eh Frank And yet again you decline to answer my simple question that would underline just how wrong you are. Really - and MD of a successful company that has forgotten that NIC is applied on pension contributions. Come on frank - as i said - I was being kind! £24K NET contributions - minus the £7500 TFCon the fund of £30K = £16,500 If you look at the GROSS income of £1125 (5% on an annuity pot of £22,500) then pay back is indeed 14.66 years (£16,500 / £1125 = 14.66 years. But as you can see we are mixing NET and GROSS which is not the proper way of doing the calculation but to be honest - I felt 14.66 was more than enough to make the point. So tell me Frank - if we wanted to do the calculation properly and look at the NET to NET figures then what would be the number of years to return then Frank? (Let me give you a clue - it is £16,500 NET CONTRIBUTION after the tax free cash has been taken, divided by the NET income which is £1125 less 20% Income Tax = £900 So £16,500 / £900 = ???????? Hint - it is just over 18 years Frank 18.33 r years to be exact. 8-) No, I'd forgotten, even if I ever knew, that NI is levied on pension contributions. Why should I know? If I have air conditioning fitted in a new shop I don't know whether it will need a three phase electricity supply either, why should I? Just as you don't know anything about prime retail units I don't know an awful lot about the details of pension schemes or electrical installations. I pay people to do all this trivia Clive. The secret of being good at business is to concentrate on your business and let others do the things you're not trained in. Perhaps if you'd taken this approach you'd have had a far bigger firm and a more successful career? But to get back to the subject matter - you still don't seem to want to admit that you failed to grasp Dave225's premise about getting back just what SHE paid in and not counting the government's tax contribution. I understood it, how come someone such as you, whose job it is, clearly didn't? And how do you know she will be a taxpayer? I would suggest that it's unlikely as we're talking here about small amounts of income which, even when added to a state pension, is unlikely to take her into income tax. Let's agree Clive that you know sod all about business and I know little about finance, but I had the brains to understand Dave's point, which you obviously didn't! It's been really fun getting you excited anyway! ;-)
Guest Had Enough Posted January 19, 2014 Posted January 19, 2014 CliveH - 2014-01-19 4:31 PM Tracker - 2014-01-19 4:19 PM Some things will never change! No sadly - it seems they won't. It is a shame tho - because when I was born God graciously provided me with an Ar$ehole - but it seems Frank wants to be a second one for me. It is nice of him but one is really enough. B-) What were you saying about me making snide remarks? (lol) (lol) (lol)
Tracker Posted January 19, 2014 Posted January 19, 2014 Had Enough - 2014-01-19 5:02 PM What were you saying about me making snide remarks? OK then - not only you!! That was a bit uncalled for Clive don't you think?
CliveH Posted January 20, 2014 Posted January 20, 2014 Tracker - 2014-01-19 5:09 PM Had Enough - 2014-01-19 5:02 PM What were you saying about me making snide remarks? OK then - not only you!! That was a bit uncalled for Clive don't you think? I do not see my opinion of Frank as snide - it is just my opinion but if someone acts like one, produced verbage that could come from one, then they take the risk of being called one. I have put up with enough $hit from Frank to realise where it comes from. What is factual is that Frank may be in his 70's but he acts like a 7 year old. He pops up saying I am wrong and that he can see where Dave gets the 11 years payback from and then when pushed only manages to get the calculation to 12 years by making a fundamental mistake. His reaction to this being pointed out to him is, sadly, typical and a classic example of exactly that behaviour of which he accuses others. The man is a fruit loop. He seems to be obsessed with me to an absurd degree. If anyone is offended by my referring to Frank as an Ar$ehole then I apologise to them. But my opinion of Frank remains the same. His last post is classic Frank - ...................................... "Let's agree Clive that you know sod all about business and I know little about finance, but I had the brains to understand Dave's point, which you obviously didn't!" ...................................... Frank - I think we should agree that you know less about business than you think you do. If you knew more I believe you would do things differently. You would probably be a more rounded and "nicer" person as well. I agree that you know little about things Financial - and as "things financial" are the basic building blocks of any business - this leads me to the above conclusion. And so I would CERTAINLY agree that you have the brains to understand Dave's point given the fundamental flaw in the premise.
Guest Had Enough Posted January 20, 2014 Posted January 20, 2014 All I have to say Clive is 'proof of the pudding'! Being a good businessman is knowing what to concentrate on and feeding the rest to the experts whilst you get on with building your business. You've seen my very strong balance sheet snapshot - I wonder how I got it like that eh? ;-) But let's get back to the main point, which you diverted froml. Start again - I have a company pension scheme in which we pay a fixed sum each month for our senior people. I set this up years ago and although I'm no longer involved in the day to day running I'm assuming it's not changed. So, once more, I say to a new employee "I can pay you £20 K a year or I can pay you £19K a year and I can enrol you in our pension scheme and pay the £1000 p.a. into that. Now we all know that if he takes it as salary he'll draw £700. So how much of the £1000 that we put into the scheme will go to his pension and will he pay any tax or N.I on that £1000 into his pension? Let's start from there and please, no long winded stuff about salary sacrifice etc, , we're not getting involved in that. Just a simple answer please and then we'll work out how long it will take him to get back the £1000 salary he's given up when he finally draws his pension. And as for Dave225 I can guess that he's done a well thought out analysis which takes into account the likely growth in the pension and that his 11 years will turn out to be pretty accurate. Here's something I find obvious - if you put salary into an ISA you're putting in 70p for every £1 of gross salary. Only the miniscule interest is untaxed of course. But if you have a company pension I believe that the entire £1 goes in, which is 43% more money to invest. Even with a salary sacrifice you're putting 25% more of your money into the scheme than you would into any other form of savings - isn't that right? So no more abuse about my business skills, I've proved them! Just put me right on the above propositions. I'm travelling today so may not be able to respond for a while.
CliveH Posted January 20, 2014 Posted January 20, 2014 Frank - I covered this earlier. CliveH - 2014-01-19 9:19 AM But you do throw up an interesting point. If Dave's wife had said to her employer that she wanted not to make the contribution in the normal way - but asks her employer to reduce her salary via "salary sacrifice" to £19,000 and then getting the employer to make an employers contribution then the employers NIC at 13.8% on that £1000 can be paid into the scheme. So if it is this that you have tried to research Frank - then nice try but you have part of the NIC 'kicker" at the wrong rate! - DOH!!!! We are doing a lot of these for people who earn too much to now be eligible for child benefit. It is a simple matter to do - BUT - it does involve the employer in a fair bit of "negotiation" with the Revenue - the scheme has to be registered and the employee has to have an audit trail of requesting such a tax avoidance scheme. They have to enter it on their tax return as such a scheme But keep trying Frank! You must be learning a lot! Nice to see that you are indeed learning more about business Well done BUT there are some caveats that you should outline to your employee if you as the employer decide to go down that route. Yes - you as the employer would save 13.8% NIC and yes the employee would save their employees NIC as well which is a remarkably attractive proposition such that if you rebate the 13.8% employer NIC into the pension scheme as well the employee can end up having the same Take Home Pay, but a considerable increase in pension contributions. One huge benefit and one that is quite topical at the moment is that individuals who earn too much to receive child benefit can, by using salary sacrifice, carry on receiving this benefit AND pay more into their pension. This has raised the profile of Salary Sacrifice and we are setting up a number of schemes on the back of this. That is the "pro's" of such a scheme. The "con's" are that the revenue do classify such schemes as potential tax avoidance schemes and so you as the employer have to gain approval from the revenue and certain letters from the employee have to be in place requesting that they be allowed to do this. You can see why the revenue is so careful as the tax avoidance possibilities are considerable. The Employer also has to have a payroll system that can run a salary sacrifice scheme - not usually a big problem but it can lead to extra expense for the employer. For the employee, one huge disadvantage is that they now have a salary of a lower level. So if the Death in Service Benefit is, say 4 times salary then it will now be 4 times £19K not 4 times £20K. Similarly, if the employee wants a mortgage then the lending calculation will be a multiple of £19K not £20K - so salary sacrifice can have a negative effect on the individuals ability to borrow to buy their house. Also - certain State Benefits are salary related and so these are also reduced. One of these of course is S2P - the Second State Pension. This would now be based upon the individuals reduced NIC contribution rate.
CliveH Posted January 20, 2014 Posted January 20, 2014 Frank ISA's - both you and Dave make the mistake of only referring to Cash ISA's An Investment ISA enables the individual to access exactly the same funds as they can in a pension. And so when you refer to "minuscule interest rates" you are talking about the current poor return from money on deposit. You could put your pension pot in the providers Cash fund and get exactly the same "minuscule interest rate" within the Pension as you would get in an ISA. Or you could take advice and select a portfolio for your Investment ISA exactly the same as that for your pension! This should be suitable to your attitude to risk and that would include a range of investments - Equities, Fixed Interest, Property and indeed - Cash - tho cash funds are VERY poor performers currently. But the point is, that the investment opportunities and options within an Investment ISA is exactly the same as for a pension. Again I have previously provided a couple of links that offer a good comparison. I repeat them here:- http://citywire.co.uk/money/are-pensions-finished-yes-because-isas-are-better/a660834 http://www.thisismoney.co.uk/money/pensions/article-1699680/Pension-vs-Isa-The-big-debate.html May I sugest you read them.
Guest Had Enough Posted January 20, 2014 Posted January 20, 2014 CliveH - 2014-01-20 8:24 AM Frank - I covered this earlier. CliveH - 2014-01-19 9:19 AM But you do throw up an interesting point. If Dave's wife had said to her employer that she wanted not to make the contribution in the normal way - but asks her employer to reduce her salary via "salary sacrifice" to £19,000 and then getting the employer to make an employers contribution then the employers NIC at 13.8% on that £1000 can be paid into the scheme. So if it is this that you have tried to research Frank - then nice try but you have part of the NIC 'kicker" at the wrong rate! - DOH!!!! We are doing a lot of these for people who earn too much to now be eligible for child benefit. It is a simple matter to do - BUT - it does involve the employer in a fair bit of "negotiation" with the Revenue - the scheme has to be registered and the employee has to have an audit trail of requesting such a tax avoidance scheme. They have to enter it on their tax return as such a scheme But keep trying Frank! You must be learning a lot! Nice to see that you are indeed learning more about business Well done BUT there are some caveats that you should outline to your employee if you as the employer decide to go down that route. Yes - you as the employer would save 13.8% NIC and yes the employee would save their employees NIC as well which is a remarkably attractive proposition such that if you rebate the 13.8% employer NIC into the pension scheme as well the employee can end up having the same Take Home Pay, but a considerable increase in pension contributions. One huge benefit and one that is quite topical at the moment is that individuals who earn too much to receive child benefit can, by using salary sacrifice, carry on receiving this benefit AND pay more into their pension. This has raised the profile of Salary Sacrifice and we are setting up a number of schemes on the back of this. That is the "pro's" of such a scheme. The "con's" are that the revenue do classify such schemes as potential tax avoidance schemes and so you as the employer have to gain approval from the revenue and certain letters from the employee have to be in place requesting that they be allowed to do this. You can see why the revenue is so careful as the tax avoidance possibilities are considerable. The Employer also has to have a payroll system that can run a salary sacrifice scheme - not usually a big problem but it can lead to extra expense for the employer. For the employee, one huge disadvantage is that they now have a salary of a lower level. So if the Death in Service Benefit is, say 4 times salary then it will now be 4 times £19K not 4 times £20K. Similarly, if the employee wants a mortgage then the lending calculation will be a multiple of £19K not £20K - so salary sacrifice can have a negative effect on the individuals ability to borrow to buy their house. Also - certain State Benefits are salary related and so these are also reduced. One of these of course is S2P - the Second State Pension. This would now be based upon the individuals reduced NIC contribution rate. It's pity that you couldn't resist the snide little remark about me learning about business, but there you are. I haven't learnt this today Clive. I told you that I'd set up this pension scheme years ago and I know exactly the pros and cons of it! But this gets me back to my original post where I gave you the figures. If my staff member lets me put £1000 p.a. into our pension scheme instead of taking it in salary it will only cost him £700 p.a. and if he takes the 25% lump sum he will get back everything he's paid in 12 years. accept he'll get it back gross and may have to pay tax on it - BUT WE DON'T KNOW THAT! So, having settled that, can you now tell me if we put £1000 p.a. into his pension for thirty years, how much do you expect the fund to grow? Presumably the pension funds will be invested in the same markets as your ISAs, so we can expect similar growth? If you can now tell me roughly how much a typical provider can grow the fund we will then be able to work out how much bigger the pension payments will be and how that will reduce the period to get back the £21,000 that it has cost him. Dave's 11 years is may actually be looking pessimistic for someone in a non-contributory scheme. Ps Where did I get the NIC rate wrong? I've only mentioned employee's NIC as far as I remember which I put at 10% but stressed that this was for ease of calculation. I'm aware that it's not exactly right. I'm also well aware of the employer's rate thank you as until recently I still did our P11ds and we have to pay employer's NIC on car benefits for instance and my spreadsheet was programmed at 13.8%. Please show me where I stated a specific NIC rate.
Guest Had Enough Posted January 20, 2014 Posted January 20, 2014 CliveH - 2014-01-20 8:59 AM Frank ISA's - both you and Dave make the mistake of only referring to Cash ISA's An Investment ISA enables the individual to access exactly the same funds as they can in a pension. And so when you refer to "minuscule interest rates" you are talking about the current poor return from money on deposit. You could put your pension pot in the providers Cash fund and get exactly the same "minuscule interest rate" within the Pension as you would get in an ISA. Or you could take advice and select a portfolio for your Investment ISA exactly the same as that for your pension! This should be suitable to your attitude to risk and that would include a range of investments - Equities, Fixed Interest, Property and indeed - Cash - tho cash funds are VERY poor performers currently. But the point is, that the investment opportunities and options within an Investment ISA is exactly the same as for a pension. Again I have previously provided a couple of links that offer a good comparison. I repeat them here:- http://citywire.co.uk/money/are-pensions-finished-yes-because-isas-are-better/a660834 http://www.thisismoney.co.uk/money/pensions/article-1699680/Pension-vs-Isa-The-big-debate.html May I sugest you read them. I have read them and it's as I knew! That the jury is out with varying opinions and recommendations but the bottom line seems to be that having both is the best. An employer can't pay into an ISA for you but he can pay into a pension for you with huge tax benefits. But the one thing that shines out from everyone of the experts is the same comment that 'ISAs are easily accessible if you need money'. And this is exactly the point that Dave made and with which I concur. People are silly sometimes and you just know that many of them taking the ISA route will succumb to temptation and spend it, guaranteeing a much poorer retirement. Sometimes you have to think beyond pounds, shillings and pence and look at things from a different viewpoint. I'm not having a go here but you rubbished my policy of providing cars for my managers. I think, as does my accountant that my way of doing it is very cost effective. But once more, as someone who has employed a number of people for many years I understand that there's more to life than the bottom line. Yes I could give them salary in lieu, but they don't want it as running a company car protects them from the shocks of high bills but, more importantly, giving them a car ties them to me and makes them think very deeply about leaving as they know that their next employer may not provide a car and they'll have to buy one. It's understanding issues such as this that make someone a good businessman and a good man-manager! It's not all pounds, shillings and pence.
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