Isle of Man Budget 2022-23

[John Wright]

4 minutes ago, A fool and his money..... said:

But surely you just pay the 40% on your earnings over the 40% band (about £50K isn't it?). So you have £50k of income that is taxed in exactly the same way as someone earning £50k or less. How is that getting spanked or brutal?

Genuine question, I don't know much about tax so may have interpreted it wrongly.

Now we understand your user name.

Let’s say Del has a £60k pension. On the tranche between £50 and £60k he’d pay £2k here but £4K in UK. The spanking is the extra £2k for every £10k.

[Happier diner]

3 hours ago, NoTail said:

I did my sums a few years ago. Then I reckoned that  with an income of 50k you were better off on the iom. I suspect its nearer 60k now.

Obviously , the real attraction is the lack of capital taxes. Many benefit from that.

I suspect it's nearer £100k before it becomes a meaningful difference and enough to offset the ferry costs every time you go off island. 

[A fool and his money.....]

7 minutes ago, John Wright said:

Now we understand your user name.

Let’s say Del has a £60k pension. On the tranche between £50 and £60k he’d pay £2k here but £4K in UK. The spanking is the extra £2k for every £10k.

That's exactly what I said. The point is no such spanking takes place on the first £50k (I appreciate we have or had a small 10% band there was talk of getting rid of it, not sure that they have).

Also spanking could be described as charging a higher rate of tax to people who can afford it the most - as opposed to our non spanking which could be described as being designed to attract rich individuals to come and live here rather than an equitable means of funding public services.

A fool and his money indeed, if he lives on the IoM and earns less than £50k.

[Derek Flint]

On 2/18/2022 at 9:18 PM, A fool and his money..... said:

That's exactly what I said. The point is no such spanking takes place on the first £50k (I appreciate we have or had a small 10% band there was talk of getting rid of it, not sure that they have).

Also spanking could be described as charging a higher rate of tax to people who can afford it the most - as opposed to our non spanking which could be described as being designed to attract rich individuals to come and live here rather than an equitable means of funding public services.

A fool and his money indeed, if he lives on the IoM and earns less than £50k.

With allowance transfer, on the IOM I paid no tax until I had earned £30k. I now start paying at £12.5k. 

The 40% threshold (which I cross with the addition of my lecturers salary to my police pension, does indeed start at £50k. As I’m working I am also paying NI on a substantial part of my overall income. I’m giving a substantial part of my income back. That is very much the burden of the so-called ‘squeezed middle.’ 

My rates (council tax) bill is around £500 dearer than I was paying in Ramsey on a similar value property. On top of that I’m charged separately for water and sewage (around £500). OK, savings are in play for telecoms, food and perhaps fuel, but I really don’t think the difference is as slight as people think. The majority of Manx residents get an exceptional deal. They must do, otherwise I would expect that we would see more economic migration?

[HeliX]

32 minutes ago, Derek Flint said:

The majority of Manx residents get an exceptional deal. They must do, otherwise I would expect that we would see more economic migration?

... except the ones who can't afford next week's food, never mind upending their lives and moving to the UK.

[Lost Login]

19 minutes ago, Derek Flint said:

With allowance transfer, on the IOM I paid no tax until I had earned £30k. I now start paying at £12.5k. 

The 40% threshold (which I cross with the addition of my lecturers salary to my police pension, does indeed start at £50k. As I’m working I am also paying NI on a substantial part of my overall income. I’m giving a substantial part of my income back. That is very much the burden of the so-called ‘squeezed middle.’ 

 

If you are fortunate enough that as a couple one can stay at home and does not have to earn then yes the IoM has an advantage over the UK before you get to £50K but I expect that these days many younger couples,  especially where one or more members is in a professions like teaching, medical, care or has some sort of clerical or blue collar employment employment will find both members in employment. The latest UK figures show that 75% of those between 16 & 74 are in employment

Your initial sentence does not quite at add up as if you are married and your spouse does not use up all their allowances then you should be in receipt of an additional married person's allowance of £1,260

[Non-Believer]

On the subject of budgeting, can anybody confirm the following please?

A chap I know who does a plant contracting/hire told me yesterday that from April the use of the good old Red Diesel is to be finally outlawed in all plant other than purely agricultural. So any sector such as plant hire, construction etc currently running their plant on red will have to move to running on white DERV with its higher taxation rate. Said chap said this will be another cost that is going to have to be passed on to the customer and is pissed off because he sees it as another blow to the small operator.

Customs and Excise have apparently already started offering advice and doing checks, to include the agricultural sector to ensure that its exclusion is not being abused. Can anybody confirm?

[Happier diner]

9 minutes ago, Non-Believer said:

On the subject of budgeting, can anybody confirm the following please?

A chap I know who does a plant contracting/hire told me yesterday that from April the use of the good old Red Diesel is to be finally outlawed in all plant other than purely agricultural. So any sector such as plant hire, construction etc currently running their plant on red will have to move to running on white DERV with its higher taxation rate. Said chap said this will be another cost that is going to have to be passed on to the customer and is pissed off because he sees it as another blow to the small operator.

Customs and Excise have apparently already started offering advice and doing checks, to include the agricultural sector to ensure that its exclusion is not being abused. Can anybody confirm?

I think this is just vehicles on the highway. So if you have a tractor, but not for farming, you can't use red. That's my understanding anyway. 

[Banker]

22 minutes ago, Non-Believer said:

On the subject of budgeting, can anybody confirm the following please?

A chap I know who does a plant contracting/hire told me yesterday that from April the use of the good old Red Diesel is to be finally outlawed in all plant other than purely agricultural. So any sector such as plant hire, construction etc currently running their plant on red will have to move to running on white DERV with its higher taxation rate. Said chap said this will be another cost that is going to have to be passed on to the customer and is pissed off because he sees it as another blow to the small operator.

Customs and Excise have apparently already started offering advice and doing checks, to include the agricultural sector to ensure that its exclusion is not being abused. Can anybody confirm?

I understand that vehicles on the roads won’t be able to use red diesel, assume they will be able to move between fields on roads. Think too many were using red in vehicles which never did agricultural work.

Police were pulling in large vehicles eg lorries at Braddan Bridge last week for checks including dipping to check what fuel they had in tanks , insurance etc etc

[finlo]

17 minutes ago, Happier diner said:

I think this is just vehicles on the highway. So if you have a tractor, but not for farming, you can't use red. That's my understanding anyway. 

I believe it's going altogether fishing boats included consumer to foot the bill!

[Non-Believer]

6 minutes ago, finlo said:

I believe it's going altogether fishing boats included consumer to foot the bill!

Yes, I wondered about this (and leisure craft) afterwards although it wasn't part of the conversation I had.

From what I could gather the agricultural side is being clamped down on in respect of haulage, you can't use a red-fuelled vehicle (tractor?)  on the road to drag a load of hay to a farm a couple of miles away

Presumably this policy is based on "tax take" and emissions, after all, if you're burning red diesel there'll be no difference to burning white, pollution-wise?

[Roger Mexico]

Oh if only there was a way of looking up information on the internet:

How is the law changing?

The current law is that red diesel can be used in any machine which is not a road vehicle. From 1 April 2022 the law will change so that rebated fuel use is limited to certain types of vehicles, machines, and appliances when the fuel is used for specific purposes only.

When can rebated fuel be used after 1 April 2022?

Permitted uses from 1 April 2022 will be:

• agriculture, horticulture, forestry, and fish farming
• rail transport
• fuel used for non-commercial purposes – electricity generation and heating
• community sports clubs and golf courses
• sailing, boating and marine transport
• travelling fairs and travelling circuses.

[Derek Flint]

1 hour ago, Lost Login said:

If you are fortunate enough that as a couple one can stay at home and does not have to earn then yes the IoM has an advantage over the UK before you get to £50K but I expect that these days many younger couples,  especially where one or more members is in a professions like teaching, medical, care or has some sort of clerical or blue collar employment employment will find both members in employment. The latest UK figures show that 75% of those between 16 & 74 are in employment

Your initial sentence does not quite at add up as if you are married and your spouse does not use up all their allowances then you should be in receipt of an additional married person's allowance of £1,260

Nope.

not available to higher rate payers, and can’t compete with the Manx allowances.

when my wife was working it was still more efficient for myself to utilize the tax allowance transfer benefit

[Non-Believer]

11 minutes ago, Roger Mexico said:

Oh if only there was a way of looking up information on the internet:

How is the law changing?

The current law is that red diesel can be used in any machine which is not a road vehicle. From 1 April 2022 the law will change so that rebated fuel use is limited to certain types of vehicles, machines, and appliances when the fuel is used for specific purposes only.

When can rebated fuel be used after 1 April 2022?

Permitted uses from 1 April 2022 will be:

• agriculture, horticulture, forestry, and fish farming
• rail transport
• fuel used for non-commercial purposes – electricity generation and heating
• community sports clubs and golf courses
• sailing, boating and marine transport
• travelling fairs and travelling circuses.

Thanks Roger. So it would appear that construction, plant hire and fishing will be hit then, although it's good to see that other key economic generators such as boating and golf courses will remain rebated-fuel entitled...

[Happier diner]

12 minutes ago, Roger Mexico said:

Oh if only there was a way of looking up information on the internet:

How is the law changing?

The current law is that red diesel can be used in any machine which is not a road vehicle. From 1 April 2022 the law will change so that rebated fuel use is limited to certain types of vehicles, machines, and appliances when the fuel is used for specific purposes only.

When can rebated fuel be used after 1 April 2022?

Permitted uses from 1 April 2022 will be:

• agriculture, horticulture, forestry, and fish farming
• rail transport
• fuel used for non-commercial purposes – electricity generation and heating
• community sports clubs and golf courses
• sailing, boating and marine transport
• travelling fairs and travelling circuses.

But that's cheating!

Basically I think it's to remove the grey areas that existed before. Before if you were using a tractor (an agricultural vehicle) to tow a trailer with a plant item on, between building sites, you could use red diesel. Now you can't because the purpose is no longer agricultural.