IHT- how to avoid if you have enough wealth

Thank you Norah.

Once again, @ Doodledog, you have misunderstood. I never said my "pittance" to be paid would be "over a million pounds", or I would be a billionaire several times over. I wish!

I am not tone deaf, just because I haven't yet engaged in any threads about people struggling with bills and heating. I have listened to their worries, and I feel very strongly that they shouldn't lose their winter fuel allowance.

I had no idea that someone at a more fortunate other end of the scale wasn't welcome to express their opinions on Gransnet.com in a non-crass manner on a thread about IHT as per the title.

Doodledog for purposes of clarity I have not used the word pittance , nor would I, unless it was in a quoted post

I am fully aware of the range of income and circumstances of the members on GN

pittance [noun] = small amount, small portion

Once again, @ Doodledog, you have misunderstood. I never said my "pittance" to be paid would be "over a million pounds", or I would be a billionaire several times over. I wish!
No, I haven't misunderstood. You meant that because of your estate of over a million your heirs would pay IHT, and were suggesting that the residual amount was a pittance, implying that you would be badly served if the government took 40% of it.

You are welcome to express what you like, and I am entitled to comment.

Grannygravy I didn't say that you had used the term. Goodness! It's like being in court here at times .

Doodledog sorry

GrannyGravy13

Doodledog sorry

No worries .

M0nica

i do not think anyone has suggested that we shouldn't spend our money before we die.

But how we acquired our assets and how much they cost, high interests rates etc is irrelevant. IHT is paid on the value of someone's estate when they die. - and thats it.

I am surprised and shocked that some think that deliberately depriving the government of lawful taxes (spend, spend, spend) is an acceptable thing to do.

This sounds rather like a criticism of people who want to spend their own money before they die!

There is nothing wrong with spending your own money. I really dislike the notion of deprivation of assets, where a third party decides whether you ‘needed’ to buy whatever you wanted towards the end of your life, but allows free spending in earlier years. I know that doesn’t apply to IHT - I am talking about the principle.

I do approve of the seven year gifting rule, as seven years is a lot of leeway when it comes to reasonably predicting one’s likely demise; and it makes no sense to encourage deathbed scenes with a priest on one side of the bed and a lawyer on the other disposing of the estate before the taxman can get his hands on it.

Spending always has knock-on effects. There is VAT on most things, and profits to the producers, suppliers and retailers of purchases, which are again taxed. I think people lose sight of the fact that if we all just hoard our money and avoid taxation as per the title of this thread then there will be no goods, services employment or civilisation. Those things depend on there being a cycle of taxation, with every pound being taxed over and over again. That’s not unfair - it’s how capitalism works.

What is unfair is when those with unearned money cling on to it, and those without are taxed on every penny they work for. Spend away - it’s hoarding and squirrelling that is bad for society - which is why we have inheritance tax in the first place.

I think it should be remembered that people are entitled to their own views. Freedom of speech is gradually being eroded in this country, I and many feel it going as itcwoukd have if Corbyn had become PM.

Who is eroding freedom of speech? And what has Corbyn got to do with it?

free spending in earlier years

😁 in the case of many people (ourselves included) free spending was a dream of the future as we struggled with mortgages, bringing up children and trying to clothe and feed them!

We never know what fate has in store for us healthwise either.

When does spending (taxed) money someone may have managed to save in later life after bringing up a family, paying off a mortgage, become deprivation of assets which should be carefully squirrelled away in case the state needs part of it to fill the black holes created by successive Governments?

Allira

M0nica

i do not think anyone has suggested that we shouldn't spend our money before we die.

But how we acquired our assets and how much they cost, high interests rates etc is irrelevant. IHT is paid on the value of someone's estate when they die. - and thats it.

I am surprised and shocked that some think that deliberately depriving the government of lawful taxes (spend, spend, spend) is an acceptable thing to do.

This sounds rather like a criticism of people who want to spend their own money before they die!

I am not sure I recognise that quote as mine.

On that basis it would meaan you thought I meant that spending money on the basics of food, clothes, a roof over your head was a deliberate attempt to stop paying tax.

How you choose to spend your money is up to each individual, but tieing your assets up into complicated fnancial schemes just to avoid paying IHT on your estate after you die is so often counter productive and causes more problems than it supposedly solves and a determination to avoid tax at all costs so often tips over the border into tax evasion.

I agree with you Doodledog. Although it's not very efficient (there are too many loopholes), IHT is an attempt to redistribute wealth at a time (after death) when it doesn't affect people. Ideally, I'd like to see everybody start from the same place when they're born. People could then claim they'd worked for all their wealth (and spend it however they want), but we all know that some people start with a huge advantage and others inherit unearned wealth during their lives. Inheritances entrench intergenerational inequality.

It was wasn't your quote, apologies M0nica

However, it was choughdancer's post in response to yours in which you said
As far as I am concerned, and there is likely to be IHT paid on my estate, IHT is my last thank you to the country who provided me with a politically stable regime to grow up in, (state) educated me, paid me to go to university, which enabled me to have a well paid professional career, and looked after my health without me worrying about the cost.

Presumably, over the years since when you have been working, you have paid income tax and National Insurance plus many other taxes and may continue to do so, minus NI, in retirement, so I'm not sure why anyone would think the Government would need a final thank you after we die.

growstuff

I agree with you Doodledog. Although it's not very efficient (there are too many loopholes), IHT is an attempt to redistribute wealth at a time (after death) when it doesn't affect people. Ideally, I'd like to see everybody start from the same place when they're born. People could then claim they'd worked for all their wealth (and spend it however they want), but we all know that some people start with a huge advantage and others inherit unearned wealth during their lives. Inheritances entrench intergenerational inequality.

That sounds like an extreme ideology which has been tried by some governments around the world and found not to work in practice.

Allira

growstuff

I agree with you Doodledog. Although it's not very efficient (there are too many loopholes), IHT is an attempt to redistribute wealth at a time (after death) when it doesn't affect people. Ideally, I'd like to see everybody start from the same place when they're born. People could then claim they'd worked for all their wealth (and spend it however they want), but we all know that some people start with a huge advantage and others inherit unearned wealth during their lives. Inheritances entrench intergenerational inequality.

That sounds like an extreme ideology which has been tried by some governments around the world and found not to work in practice.

I was about to respond to growstuff's post by pointing out that not everyone is concerned about inter generational inequality. Thank you for illustrating my point.

I too agree with Dd's post at 6.06 this morning.

Allira agree. There are some very dysfunctional and unhappy very rich families too but isn’t good health the best protection against inequality? Very little has been done to research causes of inherited diseases and to prevent these genes being passed on down the generations. That’s the biggest contributor to social inequality in my book.

ronib

Allira agree. There are some very dysfunctional and unhappy very rich families too but isn’t good health the best protection against inequality? Very little has been done to research causes of inherited diseases and to prevent these genes being passed on down the generations. That’s the biggest contributor to social inequality in my book.

No, equality of opportunity (including inherited wealth) is the best protection against inequality

PS. There's quite a lot of research on inherited diseases.

Maizie I know not everybody is concerned about intergenerational inequality, but I am, and - as is so often pointed out on GN - I have a right to an opinion.

I'm sorry I used the word "pittance", it was a bad choice ("relatively small amount" would have sounded better), but this is a topic that causes me upset when people suggest that I am, at this stage in my life, deliberately depriving any government of what rightfully belongs in their coffers. Or that I was born with a silver spoon in my mouth. I am neither tone deaf, nor crass, but my opinion is built on personal experience and I feel I should be allowed to express it without criticism, and without implying I would have to pay £1 million in IHT.

Allira

growstuff

I agree with you Doodledog. Although it's not very efficient (there are too many loopholes), IHT is an attempt to redistribute wealth at a time (after death) when it doesn't affect people. Ideally, I'd like to see everybody start from the same place when they're born. People could then claim they'd worked for all their wealth (and spend it however they want), but we all know that some people start with a huge advantage and others inherit unearned wealth during their lives. Inheritances entrench intergenerational inequality.

That sounds like an extreme ideology which has been tried by some governments around the world and found not to work in practice.

Extreme ideology? Really? I hope you're not one of those people who claims rich people have always earned what they own.

growstuff you seem to say everyone needs to inherit the same amount of money? Do we get to pick and choose our families?

Back in the day when I inherited, 1980 ish, barely out of university, I think it was called Capital Transfer Tax. I think the threshold was around £25,000. Even in those days London properties in my road were fetching around £150k, and I inherited two, so there was quite a big amount to pay tax on. It's all relative, so yes, a £2 or £3 million threshold for IHT now sounds reasonable in today's world.
As someone said earlier, I like to think family first. My parents left this world, albeit prematurely, at least knowing I was provided for with a roof over my head. In a happier world my mother would have lived to see me settled and produce her first grandchild, but this wasn't to be. The 7 year rule also didn't work for my parents, so I was stung by that too. I have paid my own inheritance forward as much as I can to my own children and grandchildren. At no point have I deliberately set out to avoid tax at all costs, nor got anywhere close to tipping over the border into tax evasion. It is not all about the money. Charity begins at home in my book.