Inheritance Tax

I'm not a political animal and don't have any particular affiliations. I don't necessarily believe in taxing the rich to give to the poor. In my mind it's a question of the 'deserving' and 'undeserving'. I've met people who have got rich through hard work, long hours, and many personal sacrifices. I admire them to a certain extent, and don't think they should necessarily be taxed any more for their hard work. I've met poor people who play the benefits game and to me are completely undeserving of the help they get. Likewise I've met people who have been hit by terrible and unfortunate circumstances who deserve help and to keep their self-respect. The challenge is weeding out the deserving and undeserving, not the rich and poor.

But the children of people who have properties worth a million pounds get to keep a million pounds house free of tax?
I don't get it. If you want to work towards a meritocratic society, how does this work? These kids haven't earned that money themselves.

And surely this is just going to fuel another housing bubble. If I have a £250,000 property and a further £250,000 in savings, stocks and shares, aren't I more likely to upsize my house if these don't incur inheritance tax?

 

The parents might have invested all their time and money into their kids future instead of spending it on themselves.

 

I have no qualms with them doing that. Put together a little nest egg for a deposit on a house. Spend a bit of their hard-earned cash on a private education for the kids if they want.

But a million quid tax free? That's a bit beyond giving your kids a helping hand in my view.

 

I can see where you're coming from but it's not really tax free, in my opinion. They had already paid tax (presumably) on the money they earned to buy the house in the first place. I can see an argument that the increase in value of a house could be taxed (as it already is for houses that are not the person's main residence), but the owner's contribution in terms of a deposit, mortgage payments etc was out of taxed income. It is like being taxed twice on the same money.

 

See your point but disagree. £1m is not what it used to be worth (obviously). And those parents have paid a lot of tax over their 40 years working life to own that house outright. If they want to give that to their children then good for them.

It's the same attitude I want to instill into my children. Work hard and get your rewards. What is yours is yours through hard work. Do tax the hard working. Then to take the opportunity to tax them again for having the cheek to die? Makes me feel sick.

And no. I don't live in a £1m house. If I ever do it will be through breaking my neck through work, having paid up to 40% of what I earn to the government. They can **** off if they think they can then tax my children again.

 

Yep, tis a "potentially exempt transfer" andytyke. These sort of people seldom want to part with their riches in advance though!

 

Increasing inheritance tax significantly is the only way to redress inequality in society, and would encourage people to view what they give to and leave their children in non-materialistic terms. Give time, not money.

This policy just shows who the Tories stand for. Unfortunately Labour will probably ape it.

 

Inheritance tax is only paid by 6% of all estates , yes 94% of people will never have any dealings with it. so why is it such a big deal for most people ?
It shouldn`t be , it is so far down the list of things wrong with this Country it is unbelievable that it is making any headlines.

 

Aye make the rich richer. What an unusual policy for the Tories.

 

That's only because people plan mark.

Inheritance is the scurge of the working man

 

Rob , that is total ballax! 6% of ALL estates pay it, just 6% not anymore. If it was a scourge on the working man, the Tories would be increasing the moneythey made from it.It is a tax on the richest 6% of estates . Nothing to do with the working man.

 

I m a working man

 

Inheritance tax is a joke. So poorly legislated and so easy to avoid with good planning - that's the reason so few people pay it.

Potentially exempt transfers are the perfect example. Give your assets to your kids before you die and if you live 7 years there's no inheritance tax. You even get taper relief such that the closer to living 7 years you get, the less of the 40% tax you pay.

That said, I'm not sure I particularly agree with inheritance tax as a principle. Why should you have to sell your parents' house that they've left to you just so you can pay the inheritance tax bill? I think the amount you pay should depend on who it's left to rather than the value of your estate, as generally it's the recipients that pay the tax as the estate will hardly ever include 40% of free cash.

It needs a complete overhaul. In my opinion it should be scrapped altogether and replaced with capital gains tax. That's not going to happen anytime soon though.

With regards to Tory policy, I agree with it. The family home is something that I don't believe should be subject to inheritence tax unless it's a mansion. Only people with mansions can afford to pay the inheritance tax without selling said home.

 

The notion of a family home being passed down is more flawed. In the rare cases where there's only one descendent who is inheriting a house worth more than the threshold then they can pay the 40% out of the sale of their own home.

The best thing you can inherit is a loving upbringing with the support to allow you to be the best person you can possibly be. I hope my mum and dad spend every penny on themselves, not save it up for me.

 

I canpromise you that I will look after my family that's for sure

 

And would consider my self a complete failure of I didn't

 

Yes, the owner paid tax. It's just the second time round it is the kids who will be taxed when they receive their unearned inheritance.

I can see your argument as well, but I'm confused why inheritance tax should apply to houses and not stocks, shares, etc. Are we going to get a spate of old sick people buying up big houses just before they snuff it?

 

I realise my view on why we should have inheritance tax isn't a popular one (bizarrely given most people aren't affected by it) but I can't really add to this I put in a previous thread on the subject:

'Or people don't strive to pass on to their kids in monetary terms? Work less hours, spend more quality time with family life. All do 4 day weeks meaning there's more work to go round? Less relationship breakdown. Less pressure on schools to be seen as the sole provider of education. A happier population not panicking about house prices. And not panicking that their kids won't be able to afford to buy because you'd have lower house prices. that

Plus people are living longer. Most people get money at a point in their life when they don't need. When they've already bought the family home and have growing kids of their own. Greater inhertiance tax would encourage people to downsize releasing family housing for those that need it, and equity release would help their kids financially at the point when they do need it.

And then there's the point about all the kids who's parents couldn't afford to buy a house (because of the high house prices and low wage inequality). A cycle of disadvantage for them too.

I'm not criticising for a second the notion of wanting to save for your kids to pass something on. I completely understand why. Just pointing out it is the biggest reinforcement of inequality and high house prices. And inheritance tax is a radical (though unpopular) way to readdress those things.'

http://bbs.barnsleyfc.org.uk/showth...t-Pounds-Per-Hour/page3&highlight=inheritance

 

Interesting point regarding buying up big houses. My guess is that firstly, it will have to be your private principal residence, as you have for capital gains purposes. Secondly, I'd probably make it such that you still have to pay inheritance tax on any capital improvements made to the house in the 7 years before death and if you sell your house for a more expensive house in the 7 years before death, you're taxed on the difference in value.