undefined | Better HN

0 pointsnemomarx1y ago0 comments

more money solves that in the end doesn't it? Just ask for enough to cover the tax burden

0 comments

But isn't it better to find a tax avoidance strategy that's mutually beneficial to both sides? Sure, you can ask for an extra $10k that gets taxed down to $5k, but if you can find a creative workaround to get $8k instead for the same $10k, isn't that better than trying to ask them for a $16k raise to make up for the taxes?

srockets1y ago

That $8k may cost another $5k to implement: current systems used by the would be employer may not be geared up to handle that non-standard asks.

pdimitar1y ago

Valuable counter-point, thanks. Still their problem though, and they should make it a bit more transparent: "It would cost us extra to implement this, are you OK with a final offer that's yours minus $3k to offset our costs?".

setr1y ago

I think the best thing is to ask for $10k or equivalent, and then let the HR team come up with a sane way to construct that value that works under their system. It's kind of like getting requirements where the customer tries to tell you the exact logic to program, but since it's not their codebase/background, they end up coming up with convoluted solutions.

Just tell me what you want, and let me as SME figure out how to get you there.

derefr1y ago

The problem comes with progressive taxation, especially in vaguely-socialist countries.

When you're in a high-enough tax bracket (in taxation regimes where such high tax-brackets exist), adding a marginal dollar to your net income becomes impractically expensive for the company, compared to basically anything else the company could offer you.

For some people, in some places, getting an extra $20k/yr tacked onto your net income, would cost your employer more than just, say, hiring you a well-paid full-time personal assistant, with the skills necessary to do enough of your job that you go from "overworked" to "takes off early most days to go play golf."

yladiz1y ago

I’m not sure I follow. In a progressive tax system you pay in brackets, so that extra $20k doesn’t mean the rest of the salary is entirely in the new bracket, so why would it cost an exorbitant amount?

Izkata1y ago

Net income is what goes into your bank after taxes/etc. In the US, the higher tax brackets are around 30% for federal taxes alone, so that extra $20k costs the company around $30k. Not counting state taxes or anything else like paying into benefits. Not sure if retirement savings count here. So let's say between $35k and $40k.

Googling "personal assistant salary", it looks like the average in the US is ~$50k/year. So a personal assistant would cost more, but it is in the right ballpark where that could be a better choice than that raise if this is the reason for the raise:

> with the skills necessary to do enough of your job that you go from "overworked" to "takes off early most days to go play golf."

2 more replies

j / k navigate · click thread line to collapse