Tax on royalties after death? (One for the accountants)

[GetCarter]

I don't intend to die soon. But you never know (everyone else seems to be dying!).

The royalties I get for my published music will be paid to my estate for decades after my death. Will my family have to pay tax on this at the same rate?

Will it be just as if I am still alive but without all the stuff I can claim against tax whilst I work? (i.e. my family will pay much more tax)?

I assume so, but thought I'd check, and google won't let on.

TIA

[SpeckledJim]

If someone will become the owner of your music, then they'll become the owner of the royalties and the payer of the tax, surely?

Just like rental income on your house?

[Eric Mc]

Exactly. There are lots of dead writers, song writers etc who's work still generates pots of income for trusts, estates etc.

[GetCarter]

Ok.. thought so... just checking.

Better not die then.

[WindyCommon]

GetCarter said:

Better not die then.

Or better be clear as to who is going to benefit from those royalties after your death should you fail to avoid it....!

[oop north]

Re your question about whether or not the recipients of the royalties can get deductions for expenses in the way that you do, the answer is they shouldn't,m

[GetCarter]

oop north said:

Re your question about whether or not the recipients of the royalties can get deductions for expenses in the way that you do, the answer is they shouldn't,m

I agree.

It's the reason I can never retire.

[TooMany2cvs]

GetCarter said:

oop north said:

Re your question about whether or not the recipients of the royalties can get deductions for expenses in the way that you do, the answer is they shouldn't,

I agree.

It's the reason I can never retire.

The expenses you're claiming are money you are spending on creating new work. The royalties are for existing work.

If you pay 40% tax, and claim back £1,000 you spent on creating new work, you pay £400 less to the tax man, so that £1,000 has only "cost you" £600.
If you don't spend the £1,000, you're £600 up...

[GetCarter]

It's the reason I can never retire.

[drainbrain]

When you say "retire" do you mean stop doing something which you're really good at and which you do on your terms and thoroughly enjoy doing??

[GetCarter]

drainbrain said:

When you say "retire" do you mean stop doing something which you're really good at and which you do on your terms and thoroughly enjoy doing??

What I mean is if I go deaf, I could retire. But I'd earn the same money but be taxed more!

[TooMany2cvs]

GetCarter said:

But I'd earn the same money but be taxed more!

Not quite...

You'd earn the same money on the old work, incurring the same expenses relating to that work.
You'd not earn any money for the new work, because you wouldn't have done it, but you'd have no expenses to offset.

Unless, of course, your new work doesn't earn any money, and is merely a tax dodge...? In which case, surely it'd be cheaper to not incur the expenses?

[drainbrain]

You could always join a club....

http://mentalfloss.com/article/25750/roll-over-bee...

....or build and live in another house in a "non-uk resident for tax purposes" haven...

whilst letting the current one tax advantageously as a "holiday home" ......

....and enjoying some non-means tested Disability Living Allowance with a possibility of Higher Component Mobility Allowance to fund your choice of about 500 motors available via Motability!

[GetCarter]

TooMany2cvs said:

GetCarter said:

But I'd earn the same money but be taxed more!

Not quite...

You'd earn the same money on the old work, incurring the same expenses relating to that work.
You'd not earn any money for the new work, because you wouldn't have done it, but you'd have no expenses to offset.

Unless, of course, your new work doesn't earn any money, and is merely a tax dodge...? In which case, surely it'd be cheaper to not incur the expenses?

I don't get paid for my work, just 50% of the royalties. Haven't charged for my music in 30 years.

ETA... I know that sounds weird, it's just the best way to earn money in my part of the biz without living in L.A. or London (which I could never do again).

Edited by GetCarter on Saturday 4th February 15:34

[JulianPH]

GetCarter said:

I don't intend to die soon. But you never know (everyone else seems to be dying!).

The royalties I get for my published music will be paid to my estate for decades after my death. Will my family have to pay tax on this at the same rate?

Will it be just as if I am still alive but without all the stuff I can claim against tax whilst I work? (i.e. my family will pay much more tax)?

I assume so, but thought I'd check, and google won't let on.

TIA

Your family (beneficiaries) will pay tax on any income inherited from you at their own personal tax rates. This is not connected to your tax rate or as if you were still alive.

If you are claiming against costs to offset against income then you will be paying less tax only because you have less income (after the deduction of the costs).

A family member who does not have such costs could therefore only pay more tax due to having more income.

[GetCarter]

Ta for all the input chaps.

[anonymous-user]

No, you're never too old to Rock'n'Roll if you're too young to die.

https://www.youtube.com/watch?v=Rwn0R1PFUwU

[essayer]

GetCarter said:

What I mean is if I go deaf, I could retire. But I'd earn the same money but be taxed more!

I dunno, deafness didn't stop Beethoven did it?

[drainbrain]

Even full physical death needn't necessarily be a handicap

https://s-media-cache-ak0.pinimg.com/originals/a2/...