Time to tackle the rentier economy.

GrannyGravy13

growstuff

Inheritance makes nonsense of any idea of meritocracy and any arguments that poverty is caused by laziness and fecklessness are blown out of the water.

Many people with very little strive to leave something for their children or grandchildren. Should they be denied that privilege?

I have not seen any comments on this thread accusing people of being lazy or feckless

You could argue that there is little point building up a business, buying a home or saving if on your death it is dissipated into the ether.

No one is suggesting that you can't leave something to your family. If you're clever there's several things that you can do.

GrannyGravy13

growstuff

Inheritance makes nonsense of any idea of meritocracy and any arguments that poverty is caused by laziness and fecklessness are blown out of the water.

Many people with very little strive to leave something for their children or grandchildren. Should they be denied that privilege?

I have not seen any comments on this thread accusing people of being lazy or feckless

You could argue that there is little point building up a business, buying a home or saving if on your death it is dissipated into the ether.

No, you have the use of the money while you're alive and will be able to use the money for a better lifestyle. You can (and probably have) use the money to make your children's lives better while you're alive.

Why should the children of those who have nothing to leave have a harder start in life than those who've inherited their parents' wealth?

How about cutting income tax, so people keep what they earn during their lives and can spend it as they wish - and then taking away the surplus when people die, so that everybody starts from the same starting point?

What's interesting about this and similar threads is the number of people that have been complaining about the Duke of Westminster and tax avoidance but don't want IHT to be deducted from their estates.

In fact the Grosvenor Estates Trust does pay tax on income and gains and the family would have paid IHT on inheritances from the previous Duke on assets outside the family trusts.

You should really be complaining about those companies who don't pay the full amount of tax due in the UK because of offshore operations.

I see you've just suggested the same Dinahmo and know much more about tax than I do.

If you're clever there's several things you can do

And there we have it! The rich will always find ways around paying their due taxes by employing expensive accountants and finance experts, setting up trust funds for their heirs. Even die hard Labour politicians did that.

Those striving to achieve, to put a little aside for a comfortable old age, dutifully paying their taxes every step of the way but hoping there may be something left to help their children to get a foothold in life are always the ones targeted.

Dinahmo yes there are several avenues open regarding handing down to your children and grandchildren

I just get miffed that as far as some posters on GN are concerned anyone who wishes to leave an inheritance is committing the crime of the century!!!

Callistemon

^If you're clever there's several things you can do^

And there we have it! The rich will always find ways around paying their due taxes by employing expensive accountants and finance experts, setting up trust funds for their heirs. Even die hard Labour politicians did that.

Those striving to achieve, to put a little aside for a comfortable old age, dutifully paying their taxes every step of the way but hoping there may be something left to help their children to get a foothold in life are always the ones targeted.

So close the loopholes! Where's there's a will (there isn't), there's a way.

GrannyGravy13

Dinahmo yes there are several avenues open regarding handing down to your children and grandchildren

I just get miffed that as far as some posters on GN are concerned anyone who wishes to leave an inheritance is committing the crime of the century!!!

Don't exaggerate! Of course it's not the crime of the century, but it's still increases inequality, which isn't good for social justice or the economy as a whole.

Many people only have the value of their house so, if they dont want to take out dodgy equity release, how dan they give enough to their children to help them?

There is an upper limit on gifts anyway, which has never been updated.

Don't you think everybody would like the chance of leaving an inheritance, but there's fat chance that some people will ever be able to leave anything? Does that mean their lives have been worthless, according to your logic?

Callistemon

Many people only have the value of their house so, if they dont want to take out dodgy equity release, how dan they give enough to their children to help them?

There is an upper limit on gifts anyway, which has never been updated.

Exactly! Most people don't have extra cash. Others, however, have loads - and in many cases, they haven't earned it themselves. They inherited it.

pen50

At the time that Jackie Stewart moved to Switzerland he would have been taxed at - in fact - 98%, made up of 83% income tax and 15% investment income surcharge. This was the cause of the brain drain which incentivised a vast swathe of high earners to get the hell out of the UK. The IIS was the first to be dropped, then Mrs T's governments reduced the top rate of tax to 60% and then 40%. The total tax take increased dramatically with both those changes.

You are forgetting that the likes of Jackie Stewart would have received tax relief on their pension premiums and mortgage interest at their marginal rate. Back in the 70s I worked on the tax returns of various wealthy people (mostly those without inherited wealth) and they still managed to have a lifestyle that most people couldn't achieve.

Growstuff whatever inheritance our AC and GC receive will more than likely be spent fairly quickly. If it is on home improvements, furnishings, cars, holidays or University it will be circulating and benefiting both them and whoever provides the products or services.

You could argue that there is little point building up a business, buying a home or saving if on your death it is dissipated into the ether.

Well, you could also argue that a) your business provides you with an income, b) you live in your house and c) apart from saving for a rainy day, no, not much point..

'Dissipated into the ether is a trifle dramtic; IHT isn't 100%.

There are allowances

In addition to the standard rate of Inheritance tax relief, which sits at £325,000, an allowance for family homes that are passed on to direct descendants (children and grandchildren) was also introduced which started at £100,000 in 2017 and increased to £175,000 for the tax year 2020/21.

So this tax year (2020/21) is the final year of the major increases to the property portion of the allowance, that finish up with a total allowance of £500,000.

www.uktaxallowances.com/inheritance-tax-increase-2020-21/

The balance is taxed at 40%

So there is a soupcon left for your heirs... (how do you get an accent into UK text?)

I don't think that inheritance tax is going to greatly affect most Gnetter's children...

dramatic, damn it....

GrannyGravy13

Growstuff whatever inheritance our AC and GC receive will more than likely be spent fairly quickly. If it is on home improvements, furnishings, cars, holidays or University it will be circulating and benefiting both them and whoever provides the products or services.

Great! So let it circulate amongst other people's children too. Why should yours have an advantage?

I'm intensely relaxed with the status quo as far as inheritance tax is concerned.

What I do want is tax dodgers to be made to pay their dues instead of hiding their money or escaping overseas.
The Greens, the Bezos, the Jimmy Carrs of this world.

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growstuff

GrannyGravy13

Growstuff whatever inheritance our AC and GC receive will more than likely be spent fairly quickly. If it is on home improvements, furnishings, cars, holidays or University it will be circulating and benefiting both them and whoever provides the products or services.

Great! So let it circulate amongst other people's children too. Why should yours have an advantage?

growstuff but it will circulate amongst other people's children if they do any of the work, manufacture and sell any of the goods purchased, thus others will benefit from the spending by those inheriting.
It will keep people in work.

And, unless those benefitting indirectly are tax dodgers, then tax will be paid on work done, goods purchased etc.

growstuff other people’s children will benefit 40% of ours and anybody’s estate which is over the IT threshold under current tax law.

Callistemon

Many people only have the value of their house so, if they dont want to take out dodgy equity release, how dan they give enough to their children to help them?

There is an upper limit on gifts anyway, which has never been updated.

How many Gnetters have houses worth more than £500,000 Callistomen?

I realise that in some parts of the country they 'might', but even so, isn't £500,000 (plus 60% of the balance) a reasonable amount to pass on?

Relatively few people pay IHT; I think some of you are getting steamed up unnecessarily...

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I don't know what some of them are.

I don`t think I am so unusual. My parents were incredibly hard working but very poor eg we used to buy one egg to make a cake. I was the oldest of seven and we were all given aspirations by our parents and were fortunate to live by a library. We all ended up in professional jobs

My husband was similar but his father had a regular wage, working in a docklands factory in liverpool. We saved, while engaged, lived with our own parents and scraped enough for a deposit and a mortgage. We took various exams and went through all the stresses of ladder climbing, while rearing 3 children. Anything we had was hard earned

Now I am comfortable because I was also a saver and a sensible investor. There is no way I am leaving my savings to be captured by the taxman to be given to people who have led the high life and spent. My children have already had dollops, all invested into their homes. My grandchildren have no idea but they have all had dollops too. More dollops will follow and my house can be surety for potential care. Maybe I will have one last house move, who knows and that is when I will be able to work out my finances, finally. Maybe by then we will have care insurances

If they were not using the money wisely then there would be no dollops

growstuff

Maizie Alt codes ç (Alt + 0231)

Thanks ?

The OP was about the tax system being changed but it is not the system at fault - it is that some who are extremely rich are able to dodge round it.