Rise will introduce an automatic tax credit (ATC) of £1,000 per month for every British citizen. The following criteria apply:
- It will be paid to the recipient’s bank account.
- Where a recipient does not have a bank account Rise will create a bank account within our new National Bank and issue a debit card to the holder.
- If there is a delay in setting up the bank account the back payments will be calculated and added once the account is in place.
- The recipient will have the option of been given a pre-loaded card until the bank account is set up.
- Every British citizen 16 or over receives ATCs except prison inmates.
- ATCs will replace pensions. However the monthly rate will be increased to £1600 per month once the recipient reaches 60 years old.
- ATCs will replace welfare payments except housing and child allowance which will be paid on a completely separate basis.
- Disability payments will be provided on top of the ATC (see our disability policies).
- ATCs will be introduced almost immediately on the election of Rise. HMRC will pay individuals the full amount. Companies will show it as a benefit in kind that will be taxed. Where payroll systems cannot meet the requirement of showing ATCs as income, but not actually pay the employee, then HMRC will support them through the issues by offering other solutions.
- ATC will not be paid to prison inmates. However Rise will improve rehabilitation services so that those leaving prison can take full advantage of ATC to get back on their feet.
Because the introduction of ATC we will increase the tax-free allowance slightly to £16,000 per year. This will ensure an individual can earn up to £4,000 before they will begin paying tax. Once an individual exceeds the allowance, they will pay tax in the same manner as now, paying on the amount above the allowance only.
- Somebody with zero income will receive £1,000 per month and pay no tax.
- Somebody with £6000 earnings per year will receive £18,000 with the inclusion of ATC. They will be taxed on £2000 of their earnings, which will amount to £68 per month.
- The individual will still be earning £11,820+ per year more than they would now and not have the issue of trying to balance it off against the impossible rules built into universal credit.
With ATC, even though the tax rate will be increased, we are not looking to increase tax revenues. When an individual is paid more than £81,000 their PAYE will be very slightly higher (by £8), but their take home pay will be higher because Rise will scrap National Insurance. This follows the Rise principles that we on the one hand reject regressive taxes, but we also carefully balance the tax burden to ensure we are not unnecessarily increasing the burden on some.
Below shows examples of income before and after Rise.
See full payscales below.
NOTE: All amounts are at 2021 figures. Once elected the amount will be adjusted annually based on actual living costs.
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