Burnhams Tax on Cash ISAS and Death tax

The state looks after them MaizieD pension credits, universal credit along with paying for their care home places if needed.

Then we have posts dripping with angst because one person has to pay for their care and another gets it free.

There is a general feeling of resentment that these differences happen.

I think that Burnham has the right idea in proposing a National Care Service. Like the NHS.

Who drips with resentment because the person in the next bed to them has never paid NI? They don't even know the status of the person in the next bed and that is right if you support the principle of free at the point of need.

Foxyferret

So if I sell a property for £100,000, the tax will be £10,000? Is that correct?. It’s not going to affect just the rich is it, it’s going to affect a lot of people with lower value properties.

We don't know for sure, but that is the assumption, yes. The difference is that if you go into care now, your £100k will last about 15 months before you have nothing left above the limit of £23k. Under this proposal, if it is as has been mooted, you will be left with £90k to pass down. Is that not better?

MaizieD

^Yes, this is how I understood the proposal to work. A small amount from everyone, rather than a larger amount from the richest 4% of the population.^

I'm finding the way that people are supporting this notion is quite interesting.

If you left an estate worth, say, £750,000 the tax payable on it would be £75,000, whereas, assuming the appropriate allowances and transfers between spouses applied, under IHT there would be no tax due at all.

(Someone tell me I'm wrong?)

I support it (as I understand it, anyway), as I think we should all pay in, not just those who work and save. This way, yes, the person you describe would pay £75k, but as things stand, if they went into care they could pay much more. Either way, it's a gamble, as most people don't ned care, but I would rather live in a society where everyone is covered by an insurance scheme paid for by everyone. From each according to ability, and to each according to need.

I don't know how it will work for individuals rather than couples, but even if the 10% is 20% for a couple it means that those with lower value houses will still have 80% left to pass on, whereas currently they can easily be wiped out financially by care costs.

I thought the age allowance on ISAs was because S&S ones need holders to take a long-term view, which isn't much use when you're 90.

Smileless2012. Yes people transfer property with a view to avoiding paying care costs. Also a lot think that if they survive 7 years after doing so the value will not be counted. Afraid there is no time limit as far as assessment for care costs is concerned. People have a real difficulty when asked "Why the property was transferred", very rare to have an acceptable answer to exclude the value. There is also the HMRC expectation that a market rent shoukd be paid and uf not that us sonething that will be taken into account for taxation. Transfering property is not the easy option to avoid care costs.

So if I sell a property for £100,000, the tax will be £10,000? Is that correct?. It’s not going to affect just the rich is it, it’s going to affect a lot of people with lower value properties.

They'll be taxing the very air we breathe soon!

MaizieD

GrannyGravy13

MaizieD if people didn’t save for their retirement, or for when household items breakdown, or various other things should we rely on the state to pick up the tab?

I haven’t got any faith in any government to look after me or my family anymore.

Where does that leave people who have absolutely no spare money to save?

The state looks after them MaizieD pension credits, universal credit along with paying for their care home places if needed.

Just because some people cannot save shouldn’t stop those who can from doing so.

I will not wear the proverbial hair shirt for being able to save for my retirement.

No point speculating re death tax until we know if it's actually going to be introduced and learn the details.

The woman in the next room has never worked a day in her life getting it all for free.

What would you like to happen to this woman, then, Menopauselbitch? Turn her out and let her rot and die at home?

Why shouldn’t they. My man is in a care home which we had to sell her house to pay for it. The woman in the next room has never worked a day in her life getting it all for free.

Aveline

So what do you suggest MaizieD? Something fair?

Well I would say that if people wish to save for the future then fine! Tbat has to go within a society that provides for those who genuinely NEED assistance not one that gives to those who dont need it as they have their own savings or a good enough income to live on!

Re the original OP the 10% on all estates makes absolute sense to me .

I'm not in suggesting mode at the moment.

I'm rather more interested in what people who do have a bit of spare cash to save think what people who don't have it (don't forget that 20% of the UK population live below the poverty line) are supposed to do.

So what do you suggest MaizieD? Something fair?

GrannyGravy13

MaizieD if people didn’t save for their retirement, or for when household items breakdown, or various other things should we rely on the state to pick up the tab?

I haven’t got any faith in any government to look after me or my family anymore.

Where does that leave people who have absolutely no spare money to save?

MaizieD if people didn’t save for their retirement, or for when household items breakdown, or various other things should we rely on the state to pick up the tab?

I haven’t got any faith in any government to look after me or my family anymore.

David49

If everyone spent everything week to week there would be no economy, nobody would invest or save, no incentive to do anything.

A great many people do precisely that, David because they don’t have any money left over after paying for their basic needs. .

Though they are actually keeping the economy ticking over because they are not diverting any money away from it into unproductive savings and ‘investments’.

If everyone spent everything week to week there would be no economy, nobody would invest or save, no incentive to do anything.

Ah. Thank you.

It could be good for the economy, Lathyrus, and much would come back to the Treasury as tax, but it could also be inflationary if there weren't enough things to spend it on

Fun while it lasts 😬

Hmmmm spend spend spend - didn't end well.

For the economy.

Obviously very good for us!

MaizieD

Lathyrus3

I mean if there’s a tax incentive to save they must want us to save??

It was a Thatcher 'thing', wasn't it? Everyone must save so as to be able to support their needs in old age rather than the state providing. Making ISAs tax free was an incentive.

Fine for those who could afford to save...

So if we were sure of care and so all went out and spent instead, would that be a good thing?

I thought it was also to persuade you to vote Conservative for ever 😂

Tuliptree

I thought buying your council house was to fund your care home ?

I thought it was so prevent future maintenance having to be paid for, by the state, on some already slightly weary properties?

Anyway, don’t get me started on this!

I loved the idea, but then Thatcher didn’t ring fence the cash and use to build more social housing and look where that has led us! Not to mention those who manage to “misuse” their new owned homes!