IHT- how to avoid if you have enough wealth

Doodledog thank you for taking the time to write the things I would have written if I hadn't been so weary with this "conversation".

Thank you.

My DC were left a small sum by my father (hundreds, not thousands). Invested at that time nearly doubled it.

They all spent it on travelling. They do say travel broadens the mind but they had a good time as well..

Witzend

One thing we’re doing legally, is putting a fair bit of cash into S&S ISAs for the Gdcs. They will have access at 18, which is slightly worrying - eldest is now 9, dh and I will be 84 and 85.

So in case we’re gone by then, TBH not unlikely, I shall be leaving letters pleading with them not to blow the lot!

Can you change the access age to 21? At 18 very likely to be blown on having a good time 😊
My aunty left my 3 3k each at 18.....it was gone on the blink of an eye 🙄

the government is trying to produce a level playing field
By taking away WFA from pensioners whilst leaving MPs with heating allowances, expenses, and subsidised meals.
While those in Westminster can take advantage of publicly funded meal discounts, the campaign pointed out that three million Brits relied on food banks last year alone.
How is that a level playing field ?
How has it been level under any government?

Doodledog. I believe there’s very little chance that social inequality will be remedied by this Labour government. Or any government come to think of it. So tax away - won’t make any difference.

Sorry - I'm not sure what where you live has to do with any of my points. They are not about you, or me, or anyone in particular.

Yes, we make opportunities, but it is much easier for someone to 'make an opportunity' when they have parental money behind them than if they are helping to support their parents out of a low salary.

Of course you are entitled to your opinion, but in mine the government is trying to produce a level playing field to give everyone the same chances. Not everyone will take advantage of the chances they get, of course, but taking a bit more from the 4% of the population who pay IHT on money they have not earned is not too big a price to pay for giving more chances to more people.

Doodledog

No, not the politics of envy - the politics of fairness.

Many others have worked equally hard, done without luxuries such as holidays, cars and latest electronic gadgets, but don't live in the SE, where (as others have agreed) much of the money passed down to the next generation comes from unearned income in house price inflation.

Children who inherit that unearned wealth simply compound the geographical unfairness and will pass it to the next generations in perpetuity. It's not about envy - it's about justice. It is easy to get trapped in an area where house prices are low, as geographical mobility and therefore opportunities for work are limited. The utterly tone-deaf advice that people should 'get on their bikes' is idiotic when many years of paying into a mortgage in one area wouldn't buy a shed in another. There is also the unfairness of having people retiring to cheaper areas having inherited money or having sold a small house whether as BTL or to live mortgage-free, which pushes up prices for locals. I've heard it called FILTH - Failed In London, Try Hastings. I wouldn't use that sort of language personally, but I understand the resentment.

Why do people think there are so many disaffected people in the UK? On one hand there are those with unearned wealth of hundreds of thousands, those who have had the opportunity to earn hundreds of thousands, those with large pensions and maxed out ISAs and full holdings in Premium Bonds, and on the other there are those who use food banks, have to declare birthday presents to have them deducted from Universal Credit, have to work for minimum wage and hand much of it over to landlords and scrape by on what's left. The second group suffers from worse health and lower life-expectancy than the first, too, and when they die there is much less to pass down to their children. If care is needed, a £100k cap will eat up most of the value of a £120k house, but just scrape a bit off the top of the value of one worth £1m.

This is not about working hard - it's about life chances.

We have seen how easy it is for social cohesion to break down. If we want to live in a country that is ruled by consent and have streets that are safe to walk on we have to do something about the unfairness, and IHT is one way to stop it being so ingrained. Those who have had the good fortune to accumulate wealth (via savings, hard work or inheritance) can still pass some of it on - it is a basic human instinct to want to help the next generation - but after a point at least some of it should go back to the public purse.

I do not live in the SE I'm a northener presently living in the Midlands and as to another of your points , I believe we all make our own opportunities.
Imo the labour party is more about taking from one section of the population rather than trying to help another section to improve their situation.

Siope strange way to run a budget in my opinion. Clearly room for improvement. Interesting to see how Labour tackles this issue. Presumably they will?

ronib

The IFS claims that the Home Office overspent on its budget for asylum support over 3 years by 8 billion pounds.
(Guido Fawkes).
I don’t quite get this one. Was the budget right to start with? Do you just move money around from one project to another?

The report is extremely clear, and this article explains the issue and its consequences

ifs.org.uk/articles/home-office-budgeting-and-asylum-overspends

David49

Doodledog

RVK1CR. As has been said several times, the people who earn money and have been taxed on it are not taxed again - dead people don’t pay tax. Their beneficiaries, who have not earned any of it, are taxed on anything over a million pounds, which is not the same thing at all.

On my hard earned cash I do pay tax again and again, VAT, Fuel Tax, Insurance Tax and all the other indirect taxes on spending.
Technically the dead don’t pay tax, but HMRC take a good chunk if they can, the result is the same, your beneficiaries get less.

Agreed. Result is the same, HMRC get their chunk.

A partial solution, for some, is charitable giving bringing ones assets under the threshold. We'd much rather our Church spend our money well - than the government waste our saved funds.

Charities have tremendous needs, more now than ever, an injection of cash would help GOSH, RSPCA, Samaritans, etc.

I'm not sure what any of this has to do with IHT, but I do know a nice Muslim lady at our craft group, so if you'll let me know more about how she is going to be promoted, Rondoallaturc, I'll pass it on.
I'm sure that she'll be interested.

Doodledog

*RVK1CR*. As has been said several times, the people who earn money and have been taxed on it are not taxed again - dead people don’t pay tax. Their beneficiaries, who have not earned any of it, are taxed on anything over a million pounds, which is not the same thing at all.

On my hard earned cash I do pay tax again and again, VAT, Fuel Tax, Insurance Tax and all the other indirect taxes on spending.
Technically the dead don’t pay tax, but HMRC take a good chunk if they can, the result is the same, your beneficiaries get less.

RVK1CR. As has been said several times, the people who earn money and have been taxed on it are not taxed again - dead people don’t pay tax. Their beneficiaries, who have not earned any of it, are taxed on anything over a million pounds, which is not the same thing at all.

The IFS claims that the Home Office overspent on its budget for asylum support over 3 years by 8 billion pounds.
(Guido Fawkes).
I don’t quite get this one. Was the budget right to start with? Do you just move money around from one project to another?

I dot often read a daily paper but scanned the DM yesterday.

1.8m migrants in the UK not working costing £8billion a year that’s a large quantity of wasted resources.

Other statistics tell us 25% of working age are not economically active.

Is there really any hope of recovery if this level of waste continues.?

Rondoallaturc

Yes, there are plenty loopholes in the IHT set up. I have already maxed out areas where funds can be protected. Since the clear intention of the new government is to promote Muslims in society and disadvantage those of us who have worked and made fiscal contributions all our lives, I now have stopped any giving to charities at all linked with abroad and have settled to enjoying the benefits I receive, such as free prescriptions, bus passes, concessions at concerts. Makes me want to make as many unnecessary bus trips as I can!!! If I get thrown in jail for this remark, my food bill will be on the government. People said in July it was time for a change…sadly they did not have the whit to realise what the implications of the change would be for Keir s “working people”. Meanwhile just watch thousands of illegals coming in each week illegally, multiplied by 5 or 6 when they want to ship in relatives, undoubtedly at taxpayer expense. For how long will they continue to claim that the previous govt left a mysterious black hole? It’s all a bit of a laugh, but not really funny!

Good post and I agree with you. The boat people are safe in France so if it is safety they want why risk a dodgy boat to cross the channel?

GrannyGravy13

Every single penny I have has been taxed, I see absolutely no reason why it should be taxed again on my death.

Totally agree with you, it is all wrong. If people earn their money and pay tax and NI they should not have to pay again when they die.

Put it all into a Generational trust
No inheritance tax

GrannyGravy13

IHT has to be paid within six months of a persons death, HMRC charges interest after this.

IHT has to be paid before probate is granted as Plunger has posted.

How many people can afford to pay IHT, not the majority of middle earners I bet!

That's a ridiculous and punitive rule.
We have a friend who was Executor of his father's will. He doesn't live nearby, is still working, so had to take holiday to come here, stay at a hotel and was told he had to list everything in the house for probate. Because there are other siblings involved, two living overseas, they had to be contacted to see what they might want from their parents' house which then had to be listed for the solicitor. Then they had to travel from overseas to help pack up the house and dispose of things which were not wanted.
The house then had to be sold - luckily someone locally was eager to buy it because the market is quite sluggish at the moment.
It could have lingered on the market for a long time as some have.

Tilly8

Just a little side note about accountants. I spent many years working as a National Insurance Inspector and State Retirement Pension administrator. In my experience accountants were experts on tax avoidance (for businesses) but the consequence of this was that the minimum amount of National Insurance to qualify for a State Pension was not paid.

This resulted in many, usually wives, not qualifying for any State Retirement Pension. This led to many distressing and upsetting discussions. I have been retired for the last 17 years so I am unsure of the current situation, but please check if your accountant is paying the minimum NI for everyone to qualify for a basic Sate Pension.

I can only say that those accountants weren't up to much.

A few years ago, when it was made beneficial for company directors to take dividends rather than salaries I always advised my clients to pay a small salary so that they paid a small amount of NIC.

I was just responding to what the Tory govt was "promoting" at the time. I myself set up a limited company with my DH and myself to benefit from this. It was cheaper to pay dividends rather than salaries.

But the govt should be blamed for this, rather than the accountants who put it into practice. It is what we are paid to do.

Sometimes it goes against against the grain but what are we supposed to do?

For example a self employed individual, using their home as their base of employment can claim for travel costs for business purposes but an employee, forking out (sometimes) huge rail fares to commute to their place of employment cannot so so. I have always thought that this was unfair but it's allowable.

Tilly8 that is a very good point

Just a little side note about accountants. I spent many years working as a National Insurance Inspector and State Retirement Pension administrator. In my experience accountants were experts on tax avoidance (for businesses) but the consequence of this was that the minimum amount of National Insurance to qualify for a State Pension was not paid.

This resulted in many, usually wives, not qualifying for any State Retirement Pension. This led to many distressing and upsetting discussions. I have been retired for the last 17 years so I am unsure of the current situation, but please check if your accountant is paying the minimum NI for everyone to qualify for a basic Sate Pension.

I don't think any of us will get an answer. Just a dark hint that if the racist post has been reported and removed it is as a result of a plot to remove freedom of speech, or to foil the dastardly plan to bankrupt the government by riding on buses all day.

Please, HQ, let it stay, so people can see it in all its inarticulate glory?

Since the clear intention of the new government is to promote Muslims in society and disadvantage those of us who have worked and made fiscal contributions all our lives,

So many questions: promoted to what? Is there an application process, or is there some form of auto-enrolment? What is the timescale? Is there any age limit? What happens if some people don’t wish to be promoted? Are Muslims who have worked and made fiscal (I think you mean financial, btw) contributions all their lives exempt? Where can people find more information on this exciting scheme? #askingforafriend