General Chat

18 to 65; in your dreams, Rollo! That's ageism, a terrible prejudice when you think that, with luck, people will all be above 65 one day.

The government of the day can continue to bribe me as much as it wants to. :-D

If government runs short of money to help its own citizens, the first thing it ought to do is to look at overseas grants and check which leaders and families have suddenly been able to live 'the life of Riley'. It would also be judicial to look at the overpaid and under-performing heads of hospitals and other bodies within its remit.

The vote should apply to people between 18 and 70 only.
Such a measure might bring back some sanity to public finances as the current large scale bribery of the over 65s would soon come to an end.

As it is most western govts will go the same way as Renzi's Italy.
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Who has got their £10 Christmas Bonus & what are you going to spend it on ? now be honest :-D

Allan ..

something similar probably happens here as the Feds make monetary transfers in the millions of dollars to the provinces, but it's often hard to work out where some of it is used!!

The previous Fed government (Conservative) brought in a law about 2 years ago to gradually change pension age to 67 or 68, starting in 2017 or 2018.

They were thrown out last year, and one of the first acts of the new Liberal government was to rescind that law :-)

Pension age has been 65 here since before we came in 1968.

65 was also mandatory retirement age for everyone up until about 10 years ago.

There are no asset tests for receiving Old Age Pension, everyone receives it but I think at a lower rate if you have not contributed it during your working life. Everyone who works has to contribute to the Canada Pension Plan to receive it on retirement.

This means that millionaires can get OAP ........ but it will probably be clawed back!

Sylvia,

The Australian system for Seniors and Council Concessions is a little more complicated than it first appears.

Yes each State/Territory funds the concessions via the local Councils, but the States, in turn, receive some funding from the Feds as a subsidy.

In WA the seniors cards are issued is gradually being increased to aged 65, although a few years ago they were issued when you turned 60. The increase in age was another way of saving costs. You also have to be working less than 25 hours oer week, but there are no checks in place to confirm this :-0

Property values, if you are an owner-occupier are excluded from the assets test for aged pensioners. There are two methods of assessing eligibility; one is the assets test, the other is the income test. Whichever test gives the lowest pension payment is the one that applies

OH and I are assessed using the assets test, but the Feds changed the goalposts a couple of budgets ago which is why we will be losing the aged pension

Allan .......

Most of the provinces have a similar programme of Seniors Grants, it is nothing to do with the Feds here. They are all income linked (judged from the provincial tax return), so that wealthy people don't get the grant.

Our problem in BC last year was that the Government decided that houses valued at more than $1.2 million was an expensive house

House prices had gone up 55-155%, so $1.2 million was actually a fixer upper.

House prices in BC, but especially in the Metro area have been crazy for about 5 years ............ overseas "investment", flipping, etc

Most of the "value" is actually in the land as the city cannot expand in any direction so the land available for further growth is only what is already within the city limits.

Our house was valued last year at $1.4 million, up from $1 million the year before, and $800,000 the year before, and around $500,000 2 years before that. However, the building itself was valued at $27,000 ............ which is exactly what we paid for it back in 1972!

Of course, one could say that we are sitting on a gold mine, like many of the people who bought even 20 years ago ........ but the converse is that we cannot afford to buy another home in the area, or even a condo, if we do sell. 2 bedroom condos are selling for more than we would get for the house. :-0

Barbra certainly opened a can of worms with this thread ;-) :-D :-D

Sylvia,

That's interesting about house prices being linked to Senior's Discounts.

In one of the recent Federal Budgets the Seniors Discount was capped so that the 50% discount would no linger apply. What we receive now is what applies no matter what the Council rates rise to.

To apply a rate to house prices would have all of Sydney and Melbourne up in arms
as the mean price would be about $1,000,000

The latest valuation of our property was in the vicinity of $450,000

Allan ................

all our pensions are taxed by BOTH Federal and Provincial governments if your total income is above a certain amount per year.

OH can now "share" his private pension with me, but until that came in OH's OAS pension was clawed back in total because his private pension put him into a much higher bracket.

Once he could share it with me, he got the OAS.

I just fall into the taxable bracket (no private pension of my own), OH is well above it. We both pay tax at source, then our financial manager files in March every year for the previous year.

I claim medical expenses over and above what the Extended Health Plan has paid against the tax paid, and as long as the total amounts to more than 3% of my net income, I get a refund

OH claims donations, memberships, travel to scientific meetings, etc, against tax paid, and also gets a refund back.

We used to get a Senior's discount on out property tax (which includes water, sewer etc), but last year the provincial government decided that all houses worth more than $1.3 million in the city would NOT get the Senior's discount (nor the previous Homeowner's Grant) ............... unfortunately, house prices increased so much in the city that a $2 million house is now a cheap house, so many more people were caught out. It made for one heck of a tax bill.

Hopefully they will change this before we have to pay the city taxes next year.

Sylvia,

That is the same as Australia. The Feds are really clamping down on welfare payments of any kind. I will certainly lose my aged pension next march when OH turns 65 and her super fund is taken into account along with mine.

We'll both receive the Seniors Health care card which still gives most of the benefits of the pension eg discounted prescriptions, concessional Council and water rates etc.

One thing that we don't know is whether the Government will back-track on a measure introduced ten years ago and that is that all private superannuation payments received as monthly 'pension' are tax free.

For the boring life-style that OH and myself lead, the loss of the aged pension will not be too great a burden :-0

"A quote from a House of Commons Briefing Paper 12 months ago

'The National Insurance Fund is used exclusively to pay for contributory benefits, and operates on a ‘pay as you go’ basis: broadly speaking, this year’s contributions pay for this year’s benefits."

That statement destroys the whole notion of there being a "Fund".
In accounting principle there can only be a "Fund" if a reserve is built up from past contributions to pay present benefits.

'The National Insurance Fund is used exclusively to pay for contributory benefits, and operates on a ‘pay as you go’ basis: broadly speaking, this year’s contributions pay for this year’s benefits.

That is no different to general taxation.

Brian ........

Surely your pension plan for Seniors is separate from the money (welfare) provided to young people who are unemployed or unable to live without getting benefits?

Ours certainly is.

The Old Age Pension and Canada Pension Plan here work on the same principle as yours ............. the workers of today are contributing the money for the pensions paid to people over the age of 65.

Problems are arising of course as the number of pensioners becomes larger than the working population .......... due to the Baby Boomers.

Benefits paid to young folk are paid from Government money set aside by both the Federal and Provincial government to fund "welfare" and benefits.


BTW, benefits paid to young folk and people under 65 are like the pensions and benefits paid to Seniors ............... the UK has by far the richest plans that I know about.

That, to my mind, is a large part of your problem ......... there is too much money being paid out to people who don't need it but are taking advantage of the system. That's to the detriment of those people, young or old, who do need help.

Here, for example, young single mothers receive help until the youngest child reaches 5 and then they are cut off benefits, given help to find jobs, and HAVE to find work.

We simply do not have a culture of large numbers of people thinking of benefits as being a normal way of life ........... most people who are able to work want to get off benefits as soon as possible.

What is the point of having a "Contributory principle" unless it is universally applied.
But that would lead to "no contributions = no benefits" and "less than full contributions = reduced benefits".
So a young person who lost their job, even with a family to support, would receive virtually nothing. Ditto a teenage unmarried mother.
As I postulated previously, the "contributory principle" is a nonsense because the young person example above will receive income support, housing benefit and so on regardless of their contribution record.

To expand another point, if all benefits were taxable rather than some being tax free,e.g. the winter fuel allowance and Over 75 TV Licence then those with an income above the personal allowance would automatically repay at least part of the benefit.

For BrianW and IGP regarding the NI Fund

A quote from a House of Commons Briefing Paper 12 months ago

'The National Insurance Fund is used exclusively to pay for contributory benefits, and operates on a ‘pay as you go’ basis: broadly speaking, this year’s contributions pay for this year’s benefits.

This note gives an introduction to National Insurance system: the base and rate structure of NICs, the operation of the NI Fund, and the connection between a person’s contributions into the Fund with their entitlement to receive benefits paid out of the Fund – the ‘contributory principle’ as it is known.

Some commentators have argued that despite these characteristics, NICs is no different in kind to other national taxes, and that integrating it with income tax would be fairer, simpler and more efficient. Although there have been a number of reforms to bring NICs and income tax into closer alignment, there remain considerable difficulties to a merger'.

You will see from the first bit of the quote that the NI Fund is 'ring fenced' and can't be borrowed or allocated elsewhere.

If your employer goes bust and hasn't paid the NIC he deducted from your wages, where do you think the money comes from to credit your NI account so there isn't a gap in your NI record for pension and benefits ? Yes, it's the NI Fund!

Whatever is thought as to the fairness and efficiency of integrating tax and NIC , I am very concerned about it. For example pensioners don't pay NI currently but would do if the two are merged?

Sometimes you have to be careful what you wish for or you get more than you bargained for.

Malcolm, unless you are paying more than one tax bill you can't just quote one income source. As Joy says all taxable income will be added together and the tax taken for all of it from one source.

Malcolm, is that not because your State Pension is not taxed at source so ALL tax due will be automatically deducted from your private pension?

That's what happens to my OH and me.

Over half of my £100 a month private pension is taken away in tax. IS DAYLIGHT ROBBERY.

“For unto every one that hath shall be given, and he shall have abundance: but from him that hath not shall be taken away even that which he hath.”

Matthew 25:29

Okay, food is VAT free - but we all pay council tax.

Strange that you query the adding up of different taxes, when that is what was done when Denmark was considered the 'happiest' place to live with people paying 55.5% to 65% tax - but received free education, including University education, free childcare, free health service.
Using a similar formula, we pay nearly the same but receive much less.

Obviously, according to you, everyone else was (yet again) wrong!!

Edit: VAT may not be 20% of my income, but it's still a tax - an extra 20% on what I buy - an extra tax paid out of money that has already been taxed!
Leaking water isn't water that I use, but I'm still charged for it.

https://en.wikipedia.org/wiki/Taxation_in_Denmark

"There are a few other things exempt or set at 0%: children's wear, cycle helmets, Aircraft repair etc, but not things I would buy or use every day!!

you don't often buy food then ?
it is zero rated and a sig part of most people's spending

KenSE comments on yr maths are fair.