[throwaway12309]

If you are in the UK, 50k a year (above average but honestly, if even remotely close to London, not that much) will bring you a tax bill of around 38% (19k) if you consider employee NHS contributions ( data from http://www.listentotaxman.com/50000? ). So you are already at 38% and you have council tax (probably another 2k or more a year) plus VAT (21% or something?) on stuff you buy. I don't remember other taxes I paid while in the UK but these were the big ones. It isn't hard to get to the end of the year and see that you(+ employer) paid around 50-60% in taxes.

I live in Portugal, and if I consider VAT+income tax+social security contributions (self employed so I pay both parts or approx. 33% in social security) and ignoring other extra taxes (property, road tax, etc) 62% or so of the money I earn goes to the government (this was for 2014, my accountant did the math). I could probably get this lower with some creative accounting I guess.

[IanCal]

> will bring you a tax bill of around 38% (19k) if you consider employee NHS contributions

You're adding on the employer NI contributions there.

[throwaway12309]

Yes. That was the point of the grandfather post. That on top of that you even have employers contributions. If you add all of that you will get a value that often reaches 50-60%. I've given the example of myself, since I'm self-employed I pay everything, my tax rate is around 60%.

[IanCal]

Ah, if you can still edit it then you might want to change "employee" to "employer" then.

In which case your effective tax rate is ~35% rather than 38%, 36325 / 55780.

My council tax is under £1200/year (and that's for the house, so we should only count half of that for me and half for my wife) and VAT is 20% on some but not all items. Pension contributions bring the tax rate down too, so it gets a bit hard to compare.

[pjc50]

50k a year (above average)

Not just above average, but in the top decile earning more than 90% of the rest of the country.

[throwaway12309]

Damn, never thought 50k was that good for UK to be honest. Always thought it was an ok one.

But even using 26.5k (average), we are at close to 30% on taxes on income alone) http://www.listentotaxman.com/26500?

[pjc50]

It's not fantastic, it's just that the UK is a very unequal country with an expensive property market. 50k gives a comfortable middle-class lifestyle outside London.

If you weren't paying those taxes, how much would you have to pay simply for equivalent health/education/unemployment insurance/pensions cover?

[HappyTypist]

That's the marginal tax rate. It's not your effective tax rate.

[throwaway12309]

Sorry, can you explain the difference? When I was in the UK that was basically what I paid and never got anything back.

[IanCal]

The marginal tax rate at £50k is actually 42%, just looking at income tax (40%) and NI (2% at that point).