IHT- how to avoid if you have enough wealth

Allira social influencers earn more than both. There are still ways of getting into education later on in life - it’s a much more fluid process. I have known outstanding students who eventually give up a great career to stay at home with their children.

ronib

Allira not quite accurate - very highly educated university researchers /lecturers are paid a pittance. Although for those with scientific degrees and into state of the art products, earnings can improve amazingly on joining a startup. It depends on individual motivation and interests surely?

One of my DD is a university lecturer and I believe she does earn more than a friend who works in Tesco.

In my opinion (to which I'm entitled without being an extreme idealogue), people should start from the same starting block

So to follow that to its logical conclusion, inheritance of any kind would be abolished and any of the deceased's assets would be seized by the state.

If every child should have exactly the same starting block in life, does that mean they should be reared in exactly the same way? The only way to achieve that equality would be by being brought up the State, as some are born to wealthy parents, some in poverty therefore circumstances are different right from the start.

I think it was the Khmer Rouge which copied Maoist principles and tried that but it didn't end well.

growstuff you do sound heavy work as a parent. So glad to hear your children overcame their initial difficulties. Many do. Humans are remarkably resilient.

Allira not quite accurate - very highly educated university researchers /lecturers are paid a pittance. Although for those with scientific degrees and into state of the art products, earnings can improve amazingly on joining a startup. It depends on individual motivation and interests surely?

I'm not advocating the eradication of highly educated, skilled professionals (I gave birth to two of them), nor suggesting they should be paid the same as people with less skilled and demanding jobs. All I'm saying is that I don't think that they have done anything to have a headstart in life.

Of course there will always be inequality, but there's no reason why inequality should be made worse, just because some people happen to have wealthy parents, who might have inherited wealth from their own parents - and so on.

In my opinion (to which I'm entitled without being an extreme idealogue), people should start from the same starting block - what they do with their talents after that is beyond my control. If I were to race Usain Bolt, I have no doubt he would always win, but there would be no reason to give him an advantage at the starting line.

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.

As long as people are born with different intellectual capabilities, there will always be inequality.

More can be done to give every child the best possible start in life and education but as long as a highly educated professional earns more than an unskilled worker, there will be inequalities in society.
Some regimes tried to eradicate their highly educated, skilled professionals but I would say that's a rather extreme solution to the problem.

escaped

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.

escaped You won't pay a penny in IHT - you'll be dead. If IHT is paid on any assets you currently own, your children, who haven't earned the assets, will pay it.

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.

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

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.

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.

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.

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

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

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.

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.

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.

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.

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.

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.

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?

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

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.