Why do we pay tax when out of area????
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Re: Why do we pay tax when out of area????
I think most of you ex service/civvy types (WorkingHard, Southside et al) are missing the main point. No one is suggesting that the UK Armed Forces should give up paying tax completely; the proposal, I would guess, would be a little tax break when deployed in an operational area. I shouldn't think it would affect your pensions/benefits at all. 
LSSA at 40% is just a joke. 
LSSA at 40% is just a joke.
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Re: Why do we pay tax when out of area????
I was not even thinking that tax should not be payable. I hope I made the point that the rules are there for all and Service Personnel should not receive any special concessions except where agreed by parliament. I also said I had no desire (really probably could not) do the job the troops do these days. So they have my utmost admiration but the tax rules apply to all. Is it not the case that whilst technicall you may be in a foreign country your base of operations is "UK soil" so to speak? I dont really know these days but if memory serves me right that used to be the case. Secondment was the only exception.
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So would you be happy Workinghard if parliament agreed to these concessions being allowed. i.e if you spend longer than a defined qualifying period away from home you get a tax break?
Surely there must be some tax break/perk to going abroad on Tony's all inclusive, 5 star, peace missions? No forgive me, to get benefits you need to be an unemployable, track suit wearing dole head chav, who contributes nothing to society. Ahhhhhh thats better
Surely there must be some tax break/perk to going abroad on Tony's all inclusive, 5 star, peace missions? No forgive me, to get benefits you need to be an unemployable, track suit wearing dole head chav, who contributes nothing to society. Ahhhhhh thats better
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I've raised this point several times with the powers that be and each time they shy away behind theanswe that the treasury wouldn't allow it. WELL LOBBY THE TREASURY TO CHANGE, ITS ALL THE SAME GOVERNMENT WE WORK FOR.
Rant over... why can't the treasury (through MOD) realise the morale boosting benefits of such a policy? I am sure that it wouldn't be hard to get through parliament since no one would be brave enough to oppose it, and it doesn't cost that much in the big scheme of things. Furthermore, you could probably offset some of the savings by reducuing the operational welfare (20 min phone call) package. Of course if they claim that this wouldn't realise any savings, they would be admitting that it is a qworthless package!!!!
It makes so much sense and it CAN be done if the will is there.
Rant over... why can't the treasury (through MOD) realise the morale boosting benefits of such a policy? I am sure that it wouldn't be hard to get through parliament since no one would be brave enough to oppose it, and it doesn't cost that much in the big scheme of things. Furthermore, you could probably offset some of the savings by reducuing the operational welfare (20 min phone call) package. Of course if they claim that this wouldn't realise any savings, they would be admitting that it is a qworthless package!!!!
It makes so much sense and it CAN be done if the will is there.
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Unmissable
Please see my entry above. The Government (Treasury) believe we have a package that is already better than most countries - because the 'independent' Armed Forces Pay Review Body told them such last year after an 'independent' review by a civilian consultancy (http://www.ome.uk.com/downloads/Inte...CER%202004.pdf ).
So you would be correct in your assumption that the Treasury would offset the costs of tax relief against the current package - this could be, as you suggest,
; but, it could easily be by reducing the amount paid in LSA (replacing LSSA under JPA). Who would benefit from
? As it is based on tax then the people with most to gain would be those paying Income tax at the higher rate - this would be senior officers and aircrew lt/capt/flt lts. I am sure that their morale would be boosted. But what about those on the standard tax rates (that would be the majority of the armed forces)? they would see their current package reduced by the same amount; however, they will not get as much benefit as those who already get paid more than them. I would suggest that this may not have the
you predict.
Of course one could always argue that those who pay tax at the standard rate should have done better at school! (Though having met recruits at Halton with Masters degrees, I doubt that this holds true either).
Rant over... why can't the treasury (through MOD) realise the morale boosting benefits of such a policy?
So you would be correct in your assumption that the Treasury would offset the costs of tax relief against the current package - this could be, as you suggest,
reducing the operational welfare (20 min phone call) package
the morale boosting benefits of such a policy
morale boosting benefits
Of course one could always argue that those who pay tax at the standard rate should have done better at school! (Though having met recruits at Halton with Masters degrees, I doubt that this holds true either).
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Tax Breaks
I have been on both sides, now as a Colonial when assigned to War-like service I receive a tax free salary(normally 48%) and tax free service allowances. My x factor is also paid tax free, it is not as some suggest a fudge factor allowance but it is there for those who may pay more than the ultimate price in personal loss. As I accrue leave both normal and war leave per pay cycle I continue to earn tax free allowances + salary for the duration of the War leave whilst back in the homeland. We have good facilities, or a least more than 1 FOB TV, 6 internet pc's and a couple of dog eared copies of fleet streets finest loo paper, and these facilities are not used to justify not giving dudes and dudettes their LOA.
I do not get these benefits whilst I spend the other portion of the year away from home on other junkets, but I feel I should be compensated for having to put up with the OH&s, tree hugging and playing with rocks and their like for the month-2months I actually spend at Home.
For those of you who think troops should not get benefits, as you lie sleeping tonight just remember you can go to the shops/pub/movies/polling station/school/uni due to the sacrifices of a few men and women not forgetting the odd dog thrown in
Charlie sends
I do not get these benefits whilst I spend the other portion of the year away from home on other junkets, but I feel I should be compensated for having to put up with the OH&s, tree hugging and playing with rocks and their like for the month-2months I actually spend at Home.
For those of you who think troops should not get benefits, as you lie sleeping tonight just remember you can go to the shops/pub/movies/polling station/school/uni due to the sacrifices of a few men and women not forgetting the odd dog thrown in
Charlie sends
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A recent article from the USA.......
Tax Credits, Combat Exclusions Boon to Warriors
If tax laws mirror a nation's values, then America clearly values its military personnel, and more so today than a few years ago.
Combat-zone tax exclusions, combined with changes to the Earned Income Tax Credit (EITC) and child tax credits, have reduced or even wiped out the tax liability of thousands of military families. For many, taxes have been replaced by extra cash in the form of refundable tax credits.
"That's exactly what these credits were designed to do for the low-income individual," said Vincent Mullett, a retired Marine and a senior IRS tax specialist in San Marcos, Calif., near Camp Pendleton. But Mullett said he knows of colonels (O-6s) who now qualify for EITC and child tax credits.
Mullett and Raphael Tulino, IRS spokesman for southern California and Nevada, spent a few hours with Military Update reviewing 2005 tax highlights for service members. Later, Army Lt. Col. Jane Fenton, executive director of the Defense Department’s Armed Forces Tax Council, offered more insights.
The first thing military taxpayers should know, IRS officials said, is that they don't have to tackle tax returns on their own. Free help is available year round, on military bases stateside and overseas, through the IRS’s Volunteer Income Tax Assistance (VITA) program.
Staffed by IRS-trained volunteers using the latest tax-filing software, VITA is open to active duty, military retirees, reserve component members, service spouses and survivors. Tax returns filed electronically can generate refunds in seven to 10 days. That should encourage even cash-strapped families to avoid the fees of commercial tax services or the exorbitant fees charged for so-called Refund Anticipation Loans.
Military members now serving in combat areas don’t have to worry about filing 2005 tax returns on time. IRS tax actions are suspended until they leave combat areas, and then they will have six months to file. Even that deadline is extended automatically by the number of days a member served in a combat zone from Jan. 1 to April 15, the normal U.S. tax-filing period.
Even in peacetime, military personnel enjoy some tax breaks. That's because a portion of military pay is provided as tax-free housing and food allowances, or "in kind" government housing and meals. On average, said Fenton, allowances represent roughly 25 percent of officer compensation and 33 percent of enlisted. The average value of tax breaks on those allowances, she said, is about $5000 for officers and $2500 for enlisted.
In a combat zone, all enlisted and warrant officer pays are non-taxable. Only the combat tax exclusion for commissioned officers is capped, for 2005 at $6529 tax free a month. A member who serves even a day in a combat zone receives that month’s pay tax free. Likewise, all bonuses or special pays received are tax free, which encourages members to reenlist or extend service obligations while serving in combat areas.
Combat tax breaks become even more valuable when combined with tax credits available to millions of other Americans. Here’s how:
EITC -- For 2005, EITC provides a refundable tax credit of up to $4400. The maximum is payable to qualified families with taxable earnings of $11,000 to $16,400. Those who earn less or more still can qualify for some cash credit. But, for 2005, adjusted gross income must be less than $37,262 (married filing jointly) for families with two or more qualifying children, and less than $33,030 for families with one qualifying child.
In 2003, when U.S. forces invaded Iraq, many low-income military families saw their EITC fall because combat zone service had left them with little or no taxable income. Ironically, many officers suddenly qualified for EITC, because long combat tours had lowered their taxable income sharply.
The Working Families Tax Relief Act of 2004 corrected this inversion. It allowed members to choose whether to include combat-zone income when calculating EITC. Higher income personnel continue to exclude combat-zone pay to qualify for the tax credit; lower income personnel include their combat-zone pay for the same reason, to qualify for or raise their EITC.
Defense officials had urged Congress to restore EITC levels for enlisted serving in combat zones but to end "windfall" credits for higher-paid personnel. Congress ignored part two of that request. The 2004 changes to the EITC law are set to run at through tax year 2006.
DoD doesn’t track numbers of service members eligible for EITC.
"We just know anecdotally," said Fenton, "that there are significant numbers of people impacted by that change."
CHILD TAX CREDITS – Like many taxpayers, military families also can qualify for the Child Tax Credit, of up to $1000 per child under age 17. For a family with two children, that is $2000 off their tax bill. But what if families have modest incomes and little or no tax liability?
For these families, Congress approved the Additional Child Tax Credit. This one can convert the unused portion of the Child Tax Credit into a cash refund. Many military families qualify.
The value of combining combat tax breaks with family tax credits can be substantial, Mullett said. He worked up an example of enlisted member with a spouse and two children who earned $25,000 in basic pay during a full year in Iraq. The spouse earned $12,000. On filing their 2005 return, the couple would get back all federal taxes withheld, a total of $8,456, plus $6400 in tax credits ($4400 in EITC; $2000 in Additional Child Tax Credit).
If the same member had not served in a combat zone, the couple would have combined taxable income of $37,000. Again they would get back all federal taxes withheld but only $577 in the Additional Child Tax Credit.
Tax Credits, Combat Exclusions Boon to Warriors
If tax laws mirror a nation's values, then America clearly values its military personnel, and more so today than a few years ago.
Combat-zone tax exclusions, combined with changes to the Earned Income Tax Credit (EITC) and child tax credits, have reduced or even wiped out the tax liability of thousands of military families. For many, taxes have been replaced by extra cash in the form of refundable tax credits.
"That's exactly what these credits were designed to do for the low-income individual," said Vincent Mullett, a retired Marine and a senior IRS tax specialist in San Marcos, Calif., near Camp Pendleton. But Mullett said he knows of colonels (O-6s) who now qualify for EITC and child tax credits.
Mullett and Raphael Tulino, IRS spokesman for southern California and Nevada, spent a few hours with Military Update reviewing 2005 tax highlights for service members. Later, Army Lt. Col. Jane Fenton, executive director of the Defense Department’s Armed Forces Tax Council, offered more insights.
The first thing military taxpayers should know, IRS officials said, is that they don't have to tackle tax returns on their own. Free help is available year round, on military bases stateside and overseas, through the IRS’s Volunteer Income Tax Assistance (VITA) program.
Staffed by IRS-trained volunteers using the latest tax-filing software, VITA is open to active duty, military retirees, reserve component members, service spouses and survivors. Tax returns filed electronically can generate refunds in seven to 10 days. That should encourage even cash-strapped families to avoid the fees of commercial tax services or the exorbitant fees charged for so-called Refund Anticipation Loans.
Military members now serving in combat areas don’t have to worry about filing 2005 tax returns on time. IRS tax actions are suspended until they leave combat areas, and then they will have six months to file. Even that deadline is extended automatically by the number of days a member served in a combat zone from Jan. 1 to April 15, the normal U.S. tax-filing period.
Even in peacetime, military personnel enjoy some tax breaks. That's because a portion of military pay is provided as tax-free housing and food allowances, or "in kind" government housing and meals. On average, said Fenton, allowances represent roughly 25 percent of officer compensation and 33 percent of enlisted. The average value of tax breaks on those allowances, she said, is about $5000 for officers and $2500 for enlisted.
In a combat zone, all enlisted and warrant officer pays are non-taxable. Only the combat tax exclusion for commissioned officers is capped, for 2005 at $6529 tax free a month. A member who serves even a day in a combat zone receives that month’s pay tax free. Likewise, all bonuses or special pays received are tax free, which encourages members to reenlist or extend service obligations while serving in combat areas.
Combat tax breaks become even more valuable when combined with tax credits available to millions of other Americans. Here’s how:
EITC -- For 2005, EITC provides a refundable tax credit of up to $4400. The maximum is payable to qualified families with taxable earnings of $11,000 to $16,400. Those who earn less or more still can qualify for some cash credit. But, for 2005, adjusted gross income must be less than $37,262 (married filing jointly) for families with two or more qualifying children, and less than $33,030 for families with one qualifying child.
In 2003, when U.S. forces invaded Iraq, many low-income military families saw their EITC fall because combat zone service had left them with little or no taxable income. Ironically, many officers suddenly qualified for EITC, because long combat tours had lowered their taxable income sharply.
The Working Families Tax Relief Act of 2004 corrected this inversion. It allowed members to choose whether to include combat-zone income when calculating EITC. Higher income personnel continue to exclude combat-zone pay to qualify for the tax credit; lower income personnel include their combat-zone pay for the same reason, to qualify for or raise their EITC.
Defense officials had urged Congress to restore EITC levels for enlisted serving in combat zones but to end "windfall" credits for higher-paid personnel. Congress ignored part two of that request. The 2004 changes to the EITC law are set to run at through tax year 2006.
DoD doesn’t track numbers of service members eligible for EITC.
"We just know anecdotally," said Fenton, "that there are significant numbers of people impacted by that change."
CHILD TAX CREDITS – Like many taxpayers, military families also can qualify for the Child Tax Credit, of up to $1000 per child under age 17. For a family with two children, that is $2000 off their tax bill. But what if families have modest incomes and little or no tax liability?
For these families, Congress approved the Additional Child Tax Credit. This one can convert the unused portion of the Child Tax Credit into a cash refund. Many military families qualify.
The value of combining combat tax breaks with family tax credits can be substantial, Mullett said. He worked up an example of enlisted member with a spouse and two children who earned $25,000 in basic pay during a full year in Iraq. The spouse earned $12,000. On filing their 2005 return, the couple would get back all federal taxes withheld, a total of $8,456, plus $6400 in tax credits ($4400 in EITC; $2000 in Additional Child Tax Credit).
If the same member had not served in a combat zone, the couple would have combined taxable income of $37,000. Again they would get back all federal taxes withheld but only $577 in the Additional Child Tax Credit.
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While doing my bit many years ago it was all tax free (not UK) and received an allowance on top of that. Would have thought it the least a nation could do for the boys and gals at the front. With the user pays philosophy that seems to encroach all avenues these days its probably a wonder they are not charging the troops an entertainment fee for having the privilege of playing in their sand pit (and transport to/from, accomodation, meals and and and ....).
Must get a job as an accountant.
Must get a job as an accountant.
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Originally Posted by WorkingHard
And the rules (as Shytorque outlined) apply to everyone without exception.
This is why lots of Brits work in the middle east, they DONT pay tax.
That gentlemen IS the exception.
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heights good
Sorry, but if you are in receipt of a pension from UK Government service (Military, Civil Service, Education etc) the UK Government WILL tax you on that pension no matter where you are in the World.
Sorry, but if you are in receipt of a pension from UK Government service (Military, Civil Service, Education etc) the UK Government WILL tax you on that pension no matter where you are in the World.
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Sorry, but even ex-pats in the Middle-East pay tax on monies earnt in the UK, i.e. if you rent out a house or 2. You don't pay tax on money earnt abroad. This is the opposite for Spams who still pay tax from what I hear out here in the sandpit.
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Originally Posted by heights good
If you are a British tax payer and you spend more than 6 months of the year out of the UK you DONT pay income tax........ unless your in the military!!!
This is why lots of Brits work in the middle east, they DONT pay tax.
That gentlemen IS the exception.
This is why lots of Brits work in the middle east, they DONT pay tax.
That gentlemen IS the exception.
