What % of all deaths (uk) resulted in an inheritance tax bill in 2021-22? you're not previewing try and have a guess?

House value to care home fee ratio. A cheaper house will be used up on fees much faster than a more expensive house.

It's because the people dying now are much more likely to fall into the pennies in the 70s category than they are to be single parents buying 500k properties now then dying straight after. And even then, someone who has enough equity in a home now, whatever their marital status, is overwhelmingly likely to have got some of that through unearned property price increase.

I understand the argument that this doesn't matter to the principle. But if that's so, people need to make the argument on that basis, not make incorrect claims about the money being taxed twice. Because actually, this is a discussion about what should happen to wealth that's often unearned.

That’s not what I said though, is it?

A house worth £1million is unlikely to be swallowed entirely by care home fees. A house worth £100k? Much more likely 🙄🤣

Why should people who weren't fortunate enough to be born into generational wealth be overly bothered about how much money someone who has done nothing to earn it themselves stands to get for free?

I don't care personally, but I do contest when people shout about being double taxed on assets that have risen in value due to nothing the owner has done themselves because its not true.

Edit to add: I do care about working farms and businesses because this isn't just about passing on assets worth x amount, but viable businesses which are worth a lot to society.

I guess it must be jealousy.

Presumably there are a lot of people who are so deeply triggered by anyone who they perceive as having more than them, that they'd rather everyone has nothing and the state controls it all. Then they don't have to sit with their feelings of envy.

If the owner is moving to another property I think it's fair enough to exempt that, if its being passed on in death or before that them seems fair to me

Snap! Literally same thought came to mind! 😆

I've no sympathy with those living in areas like the SE where housing is costly- those people stand to gain the most profit from their property investments and enjoy all the advantages of living in the most prosperous part of the country.

I didn't know the figure but I knew it was low. I dealt with my father in laws estate and my mums. It essentially worked out, with property and other assets you can inherit about half a million from each parent, so 1 million carried over if one dies first. So neither of those deaths resulted in any inheritance tax.

Seems pretty reasonable to me that anything over a million is taxed. No idea why people are getting worked up about it. Weren't there some changes a while back as to whether property would be taken into account for care fees? I'd say that's much more likely to wipe out any potential inheritance.

Cause the care home fees are so much cheaper in London and SE... 🙄🤣

Just curious, why is that? Are care home fees higher in the NE? Do more people end up in care homes?

AFAICT they haven't done anything to close the loopholes, or do anything regarding loopholes that were there before.

That already happens. You can choose to pay IHT in instalments over ten years.

For example, a divorced person dies and leaves a house worth £600k to their children and very little else in the estate by way of cash etc.

Since the main home is left to the children there is a tax free allowance of £500k. So there is 40% IHT to pay on £100k or £40k.

The executor then ticks a box on the probate form that says "I want to pay by instalments". They need to pay 10% of the tax due - £4k and can then pay off the rest after the house sells.

If the house takes more than a year to sell then they need to pay 10% and interest every year.

If there isn't even the money in the estate to raise that 10% (eg £4,000) then the executor can apply for a "grant on credit" which is exactly what you have described, HMRC puts a charge on the property and gets paid when the property is sold.

That would be similar to charging CGT on the main residence property. Logically then that would be due every time someone sold a house as well. to avoid buying and selling houses to avoid the IHT.

Edit: Not sure that would be popular with people downsizing to fund retirement or trying to climb the property ladder as their family increases.

And people in the north east inheriting property are more likely to see their entire inheritance eaten up by care home fees.

Swings and roundabouts, innit?

It will increase with including unused pension pots as assets for IHT. Pension pots can be quite large while only providing modest pensions.

But it’s not tens of thousands higher enabling them to buy a house costing say three times as much.

Any one who works in retail, NHS, teaching etc - the biggest employers in the U.K. will earn hardly anything more.
Supermarkets you’d be lucky to get an extra quid an hour.
The London living wage isn’t much more either.

Just because a few people work for places like Google and Microsoft down here skewing the figures doesn’t mean most people are on high wages!

Whenever they do stats of who has the most disposable income it’s always the north.

I find it interesting how everyone assumes these houses are all where people bought for pennies in the 70s and are now worth loads so unearned income and should be taxed.

Because they are, you just need to look at equity gains.

what about those average single parent families in London buying now, carefully saving up, having a huge mortgage in order to get a house their family can grow up in that’s already over the IHT limit. They haven’t had unearned wealth in that house? Houses near us only start at above £500k. I don’t see a huge difference in income in wages for retail staff in London and elsewhere. So it has been earned and paid for with the taxed wages? Should there be a different threshold for single people?

Potentially but I suppose the government incentives marriage? House prices are growing much slower in recent years and we won’t see near zero interest rates anytime soon so equity gains won’t be replicated as they were in the past.

"...you can’t sell it until you’ve paid the tax."

That's not true. When you apply for probate you can tick "Yes" on box 110 which asks "Do you wish to pay the tax by instalments?"

You then have to pay 10% of the total IHT bill every year until the asset is sold. Although there is interest to pay on the outstanding amount every year.

Perhaps the answer is people just pay tax on inherited properties on the rise in value regardless of the overall value? So if someone buys a £500k property later in life and it only rises say £50k the tax is just on that? Someone then who theoretically bought the same property decades before for £120k would then pay on the gap between 120 and 550k?

I think it's too late to bring in CGT to properties, but I am baffled as to why it wasn't brought in.

CGT and preventing people who do not live in the UK from buying property in the UK would have really helped control the housing market. Wouldn't it?

Also incorrect. Beneficiaries pay income tax on all forms of income derived from the estate if the deceased was over 75.

Fairly ordinary people within the wealthiest 4.39%?

I find it interesting how everyone assumes these houses are all where people bought for pennies in the 70s and are now worth loads so unearned income and should be taxed.

what about those average single parent families in London buying now, carefully saving up, having a huge mortgage in order to get a house their family can grow up in that’s already over the IHT limit. They haven’t had unearned wealth in that house? Houses near us only start at above £500k. I don’t see a huge difference in income in wages for retail staff in London and elsewhere. So it has been earned and paid for with the taxed wages? Should there be a different threshold for single people?

As I understand it this wouldn't solve the problem as the same rule changes have been made for business property relief which applies to limited companies.