What's the logic of inheritance tax?

[JonRB]

I think I can see where you are coming from, J_S_G, but I think what you are objecting to is youg people inheriting and not having to work for themselves.

I think this is fundamentally flawed. I think this because in a society whose average age is on the increase, inheritors are far likely to be in their 60's (like my mother) than their 20's.

So your arguement falls down a little bit there really.

[j_s_g]

love machine said:

...

And for what it's worth, I think all that's spot on, too.

[Ribol]

I have not read the above posts because of health issues (raising my blood pressure).
In answer to the original question, the logic of IHT is to steal money from people who cannot stop themselves being mugged. People with major money can get round it all sorts of ways but as usual if you are just an honest family going through life the right way you get shafted every time.
Even if I could get my head round having to pay something on anything over the £255k or whatever it is today how the fk can they justify 40%?
I suppose I can answer that myself, when you have a government that pi55es money away at any given opportunity they have to get it from somewhere. Perfect example, Europe, if you wanted to build a decent tug of war team would you go looking for a load of weak blokes to join, England did!

Ivan

[JonRB]

Incorrigible said:

I hope to leave nothing more than a huge amount of debt and some beaten up racing cars, tax that you fs

One beer at BTaP courtesy of JonRB for Incorrigible.

[j_s_g]

vixpy1 said:

j_s_g said: * I like the principle of everyone starting from an equal footing. * Sod that for a laugh, thats another socialist ideal that everyone is equal and the wealth should be shared around etc... Everyone is not born equal and fully intend for my children to be born with a head start on the rest of the polulation!

Unfortunately, you'll be beaten to it by all the Burberry toting dropouts who've earned far more from the dole, and taught their kids how to scam the system by the time they leave (read: drop-out) of school. Did a project for the benefits agency once on benefit self-calculation - worked out you can easily have a £50k income from the state just by dropping a few Waynettas along the way.

[j_s_g]

JonRB said:

I think I can see where you are coming from, J_S_G, but I think what you are objecting to is youg people inheriting and not having to work for themselves. I think this is fundamentally flawed. I think this because in a society whose average age is on the increase, inheritors are far likely to be in their 60's (like my mother) than their 20's. So your arguement falls down a little bit there really.

Agreed. On the proviso that those people don't live their lives in anticipation of such an inheritance in their 60s to sort out the mess they've made of the last 40 years.

[adamt]

I read that the Tories are offering inheritance tax breaks up to a million pounds.... not sure though

all the best
adam

[bertie]

It's destroyed an awful lot of fantastic houses and estates, which in my opinion is a travesty, but some would call a sucess.

People have mentioned tax burdens to their wifes if they die....unless I'm mistaken there is no inheritance tax between spouses.

Also people mention seting up companies etc to avoid it. The is no IHT on shares of "trading" companies but if you have for instance a company that owns property, that is regarded as an "investment" comapny and is subject to IHT.

If anyone knows of any good ways to avoid please do tell!!!

[GregE240]

JonRB said:

Incorrigible said: I hope to leave nothing more than a huge amount of debt and some beaten up racing cars, tax that you fs One beer at BTaP courtesy of JonRB for Incorrigible.

I'd drink 4/10s of it Jon and see how Ben feels

[Incorrigible]

vixpy1 said:

Sod that for a laugh, thats another socialist ideal that everyone is equal and the wealth should be shared around etc...

FFS Charlie, why don't you read what he said rather than roll out the old "are you sure you're not a commie" line

At no point was "share the wealth around" mentioned, only that you should work for what you get

I can see how that wouldn't appeal to you

The trouble with a lot of these arguments is that most of us agree in principle that you should work hard, be able to reap the rewards, give your children a good start in life etc etc. I would even venture to suggest that paying the money wouldn't be so much of a problem if you could see that the government weren't pissing it all up the wall

[GregE240]

I think earlier in the thread someone alluded to it being introduced to stop wealthy landowners from becoming too wealthy and posing a threat to incumbent Government / the throne.

Sadly those days are gone. Now we have once wealthy landowners having to open the doors of once great stately homes to the great unwashed to provide the cost of running these great estates.

Secondly, the threshold has never risen properly with respect to inflation, specifically the huge rise in house prices of the last 6-10 years. To that end, ever more people are falling into the "above threshold" and consequently being unceremoniously butt-ed by Gordy.

It sucks. All it achieves (aside from 3BN) is make future generations poorer and fuel the debt mountain, and prompts families into ways of avoiding it altogether. Which, unless you can predict to the nearest 7 years, you're screwed.

Get rid of it. If Howard announced this as a legitimate tax cut, I'm sure the Tories would get more votes. Wouldn't they?

[Plotloss]

There is no logic to IHT its Grief Tax and nothing more.

You pay direct taxation all your life whilst you work. What is left you then pay indirect taxation on. You get somewhat stressed about all this tax and turn to the booze, but theres duty on that. After a while you die, then they tax that.

Again it reinforces the message of sit in your own shit in a tracksuit smoking lambert and butler, vote labour and you'll be fine.

Work hard, try to provide for you family and not burden the state - you, you selfish prick, we'll have some of those earnings thanks very much.

Its utter wank.

[telecat]

Governments never do up the thresholds until they are forced. Remember the "Old" Company car tax? You had to be a Director to pay it OR earn over £8,000 a year. When they brought it in a good wage was £5,000. When it was replaced the average wage was over £20,000. Did the threshold ever move?

[Tafia]

Broccers said:

J_S_G said: vixpy1 said: What a load of socialist rubbish! If there's one thing I'm not, it's a socialist! I do see the sense in not allowing wealth to be passed down from generation to generation completely unchecked. I doubt very much that the government's intentions with it are for the "greater good", mind... If there were no inheritance tax, I can see some very interesting tax fiddles being done through it, too. Hmm Got to agree with vixpy there. Your parents or grandparents are at libbity to allocate their money where they will. They earnt the money how much or little it is so why cant the family keep it ? Anywho the way to avoid it is to buy a working farm and outsource the running of it. Simple. Or transfer the money in the x years required before death .... maybe having a family ltd company is the way to go these days... skim the top off, go bankrupt and retire to somewhere hot. >> Edited by Broccers on Thursday 7th October 00:21

Retire to somewhere hot? You have no idea how that remark has awakened my sleeping desire to eff off to just such a place. But where??

[Ribol]

You can do all the planning you want if you are not loaded, or you do not want to move to say Switzerland you will not get away with not paying IHT - LEGALLY. The one thing you can do is that when the first parent dies the second can give away up to £263k to the kids inheritance tax free.
There are loads of schemes out there, none of which can be guaranteed to work when the day comes. The ones that do cost you almost as much in other ways and you can sometimes be worse off. As far as I can make out most make money for the advisors rather than protect the clients.

Ivan

[sadako]

Way round this is to turn the deeds of your house over to your kids, then pay them rent of say, a pound a year and keep records. You'd need to be doing this for about 10 years before your death however and that length of time keeps increasing as more and more people do it. When you die you are legally tenants of your children and have no estate to tax. Like i said you need to get in on this early to pull it off unless the laws change

[vetteheadracer]

Not sure if this is still true but it used to be that if you signed your house over to your children 7 years or more before you died then it was not included as part of your estate.
You can also leave all of your assets in "trust" meaning that the state cannot tax them I believe.

The bad news to this is you have to trust your kids not to sell your house and put you in a home once you sign the house over to them......always reminds me of the John Smith's advert at this point!

[vixpy1]

Incorrigible said:

vixpy1 said: Sod that for a laugh, thats another socialist ideal that everyone is equal and the wealth should be shared around etc... FFS Charlie, why don't you read what he said rather than roll out the old "are you sure you're not a commie" line At no point was "share the wealth around" mentioned, only that you should work for what you get I can see how that wouldn't appeal to you The trouble with a lot of these arguments is that most of us agree in principle that you should work hard, be able to reap the rewards, give your children a good start in life etc etc. I would even venture to suggest that paying the money wouldn't be so much of a problem if you could see that the government weren't pissing it all up the wall

Did read the post Ben... I was refering to the Socialist ideal that everyone is born equal.. perhaps adding the bit about share the wealth was a bit ott. But i stand by my posts!

[Ribol]

sadako said:

Way round this is to turn the deeds of your house over to your kids, then pay them rent of say, a pound a year and keep records. You'd need to be doing this for about 10 years before your death however and that length of time keeps increasing as more and more people do it. When you die you are legally tenants of your children and have no estate to tax. Like I said you need to get in on this early to pull it off unless the laws change

Who told you that one
Any rent paid has to be a market value and you have to prove it was increased in line with inflation. Do not assume the tax man is an idiot, expensive mistake.

Ivan

[j_s_g]

Tafia said:

Retire to somewhere hot? You have no idea how that remark has awakened my sleeping desire to eff off to just such a place. But where??

My plan's Egypt. The new irrigation systems they're putting in place are going to transform the amount of habitable country there (we're talking 20-30% the entire land-mass). Cost of living is about tuppence a day. Property's dirt cheap (was considering investing in an entire a block of ready-built apartments for £100k in Luxor). Weather's guaranteed. Infinite number of historic things to wander around, muse over, and research to pass the time. Decent attitude towards the British. Plenty of opportunities for running small businesses around tourism to supplement any hobbies, etc.