How friendly is 'family friendly taxation'?

03/03/2010

 I read David Cameron's bugle call for "family friendly" taxation with  interest.

 

Like many of our generation, I am a married retired pensioner/taxpayer.

 

My wife is below retirement age and has no income (or eligibilty to State benefits, due to our marriage).  She will be entitled to a full State pension in due course.

 

In taxation and benefits law, the marital state does not exist. I have to claim for her as a "dependant". which enhances my State pension by some £50 a week - I add this note in case anyone in similar circumstances is unaware of this possibility.  (It's actually only £35 a week, thanks to the 30% effective Mariginal age tax rate).

 

I'm not complaining -I believe in fair taxation.  But, is it fair that she has £6000 worth of unused tax allowances when our modest "family" income is being hammered at 30% tax?

 

When she does get her State pension in her own right, she will still have over £1000 worth of unused tax allowances, whilst I will still be paying 30% tax rate.

 

David Caneron, please note. Pensioners are on fixed incomes. Pension increases (State or private) rarely reflect REAL increases at our age, and are grudgingly given.

 

Most Pensioner couples would benefit more by the pooling of their joint tax allowances, and it would simplify the tax system to introduce this option rather than continue the "marginal tax relief" system, which must cost both individuals and the State an enormous amount in annual tax returns and administration.

 

This would indeed be "family-friendly" taxation for married pensioners!

 

L. Dolby