My feeling is that if your heirs (AC and GC) are already well provided for, maybe partly because you have already passed on £££, I'm not going to start setting up elaborate schemes to avoid IHT.
I feel I'm privileged to be in a position to pay taxes. If everyone avoided taxes, how would the government provide the public services we rely on? And I fear that spending on defence will have to rise in the coming years.
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Legal, pensions and money
Over the IHT threshold? Reduce it down - or do nothing?
(89 Posts)If your estate was well over the IHT threshold and had far more money coming in than going out monthly, due to substantial pensions, and a house owned outright with no expected repairs, would you want to do something about the excess over the IHT (following advice from people like Martin Lewis? ) . This stuff is in the news a lot but then we also need more of people's taxes in the public coffers to pay for failing public services.
Eg For people in their (let's say) 80s , in this situation, the advice is often to spend more on things you enjoy while still healthy - or gifting to charity or to younger family members to help them out - or to a political party etc These are the things advisors suggest or else large chunks will just go to tax anyway, if it just sits there over IHT and the savings keep accumulating every year.
No need to do anything at all of course - after all if carer fees come along then the costs of care might eventually reduce the excess below the IHT threshold - and might even eat up all savings and the house.
Myself I know I would want to put any savings above IHT to good use at the end of my life and can think of charities and people I'd dearly like to help. But someone told me recently that this is not a responsible attitude as everyone should pay their taxes - but the way I see it the taxes have already been paid once while working - !! So many smaller worthwhile charities need support (not thinking of the bigger ones). Interested in your different perspectives.
I have paid plenty of tax and continue to do so. I have no intention of paying more than I am legally obliged to pay, whether in life or in death.
Romola i agree with you. We will end up paying IHT on our estate as it is now. We are taking no exceptional steps to avoid it. We have been very fortunate in lifeand I am willing to pay tax towards the common weal in death.
I used to work in Social Research and worked on one project which involved asking people how 'well off' they felt compared to their neighbours - and they almost always fell into the trap of comparing house size! And even if at their advanced age they owned a home outright and had savings and investments and pensions (they shared all those details, it was a longitudinal study) they still felt the young family with a somewhat bigger house down the road must be a lot wealthier. Bizarre.
We're not particularly interested in allowing our excess above IHT limits to be squandered by the government. Our chosen charities will be receiving our money for their support.
I've spent my entire married life voluntarily keeping the books at our Church, I know what they do with donations - good works.
We've saved diligently for our end of life care. Our home has little value though mortgage free for over 35 yrs - will see us out and help pay towards our care as needed. No need to sell, just continue on.
Taxes have already been paid on everything we possess. We've given quite generously to our children and grandchildren whilst we're alive, they'll each receive an identical small sum at our passing. Remainder to Church charities.
So, we spend now (good documentation) on our family and charities, saving for our care, no need to avoid IHT as we'll fall below any (new?) limit.
M0nica
Thanks for the link on the Laffer Curve which makes for interesting reading, however, I do feel that if people think they are being taxed too much they won't want to spend on anything other than essentials.
Susie42 it is not how much people are taxed, but what is left after taxation that most affects spending patterns, that and their hopes/fears for the future.
M0nica, I worded my thoughts badly on this topic and I agree with your comment.
I have paid plenty of tax and continue to do so. I have no intention of paying more than I am legally obliged to pay, whether in life or in death
Agree100%
Whatever I have when I die is for my husband if he survives me and then for my son and his family, plus the charities I support. I don’t wish the government to have one penny if I can help it. It’s not for the benefit of ‘the common weal’ as you put it, MOnica - whichever government is then in power will spend or waste it as they choose. Name the charities which you would wish to benefit - almost certainly none of them receives any money from the government. Are you happy to pay for the then equivalent of HS2, Liz Truss’s protection and pension or a hundred and one things which do Joe Public no good whatsoever?
Germanshepherdsmum
Whatever I have when I die is for my husband if he survives me and then for my son and his family, plus the charities I support. I don’t wish the government to have one penny if I can help it. It’s not for the benefit of ‘the common weal’ as you put it, MOnica - whichever government is then in power will spend or waste it as they choose. Name the charities which you would wish to benefit - almost certainly none of them receives any money from the government. Are you happy to pay for the then equivalent of HS2, Liz Truss’s protection and pension or a hundred and one things which do Joe Public no good whatsoever?
This ^
Germanshepherdsmum
Whatever I have when I die is for my husband if he survives me and then for my son and his family, plus the charities I support. I don’t wish the government to have one penny if I can help it. It’s not for the benefit of ‘the common weal’ as you put it, MOnica - whichever government is then in power will spend or waste it as they choose. Name the charities which you would wish to benefit - almost certainly none of them receives any money from the government. Are you happy to pay for the then equivalent of HS2, Liz Truss’s protection and pension or a hundred and one things which do Joe Public no good whatsoever?
Exactly.
GSM I have left money to charity, but I want to keep flexibility in my life to the end. If my parents are anything to go by, even if I live into my 90s I will still be living at home. Although the house we intend to buy will not cost as much as the one we are selling, it is still likely to be valuable, and we want to feel we have enough capital to pay for any care I may need and atill be able to splash out on anything we want.
If that means we pay IHT, so be it. These days can we even by sure that any charoty we leave money to will spend it wisely.
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