Page 2 | Inheritance Tax

Annabella92 · 2024-11-18T13:38:57+00:00

Is it wrong to try and avoid inheritance tax? Is inheritance tax itself unfair? Has your family taken any measures to avoid it?

cardibach · 21/11/2024 15:29

StandingSideBySide · 21/11/2024 15:27

As it’s a persons money they can do what they like with it.
Hence move or take measures to protect it whilst they are alive.

If everyone in the UK had to pay it starting at £1, fair enough.

Show quote history

Actually I think I probably agree we should do as some countries do and start it lower and graduate it.
However I don’t think it’s unreasonable for a person to pay tax on a sudden windfall of over £500k (or £1million if their parents were married).
Edit - and it’s only a proportion of money over the threshold, not all of it.

StandingSideBySide · 21/11/2024 15:27

cardibach · 21/11/2024 15:19

Or - just let the estate pay it so your descendants get to live in a functional country with good services.

Show quote history

As it’s a persons money they can do what they like with it.
Hence move or take measures to protect it whilst they are alive.

If everyone in the UK had to pay it starting at £1, fair enough.

cardibach · 21/11/2024 15:19

StandingSideBySide · 21/11/2024 14:11

The best way to avoid IHT is to move somewhere that doesn’t have it.
or
Plan well in advance, but that in itself can be tricky especially if you are passing property over.

Or - just let the estate pay it so your descendants get to live in a functional country with good services.

StandingSideBySide · 21/11/2024 14:11

The best way to avoid IHT is to move somewhere that doesn’t have it.
or
Plan well in advance, but that in itself can be tricky especially if you are passing property over.

cardibach · 21/11/2024 14:02

caringcarer · 21/11/2024 13:31

It's depressing that you can't pass everything you worked hard for on to your loved ones.

Show quote history

Lots of people can because though they have worked hard they haven’t amassed more than a million quid. The narrative that we’d all be rolling in it if we only worked hard enough pisses me right off.
Plus you haven’t worked hard for the property price increase.
Plus a million (or half a million even if you are single) tax free lump sum to your kids, plus most of anything above that after tax is something they should be cheering about, not depressed.

cardibach · 21/11/2024 13:59

Clavinova · 21/11/2024 12:59

Non-agricultural businesses and inherited pensions are also affected;

Changes to Inheritance Tax (IHT) proposed during the Autumn Budget 2024 include significant changes to Agricultural Property Relief (APR) and Business Property Relief (BPR). Pensions will no longer be outside the scope of IHT and liable to 40%.

https://www.rossmartin.co.uk/autumn-budget-2024/8058-inheritance-tax-iht-autumn-budget-2024

Show quote history

Fair point. But people were talking as though there had been massive changes to what they could leave their kids.

cardibach · 21/11/2024 13:58

Rollercoaster1920 · 21/11/2024 12:42

@cardibach "There. Are. No. IHT changes. Except. For. Agricultural. Relief."
Did you miss that DC pension pots are now included?

That's the but that I think will unfairly hit single parents, not in final salary schemes, living in the SE, that die from approx age of 55 to 75.

Your pension is supposed to support you in a good life in retirement, not be a tax free way to help your offspring after you die.

BIossomtoes · 21/11/2024 13:34

caringcarer · 21/11/2024 13:31

It's depressing that you can't pass everything you worked hard for on to your loved ones.

Show quote history

I’m far from depressed. Ours are getting plenty and they won’t be moaning about it either, they’ll be grateful.

caringcarer · 21/11/2024 13:31

Cosyblankets · 21/11/2024 13:18

What is?
I'm merely pointing out that you said they'd pay IHT if you died together and this is wrong.

Show quote history

It's depressing that you can't pass everything you worked hard for on to your loved ones.

BIossomtoes · 21/11/2024 13:20

caringcarer · 21/11/2024 13:17

It's very depressing.

Show quote history

What’s depressing about it? If our kids are unhappy with a share of a £1 million tax free windfall, our parenting has gone badly wrong.

Cosyblankets · 21/11/2024 13:18

caringcarer · 21/11/2024 13:17

It's very depressing.

Show quote history

What is?
I'm merely pointing out that you said they'd pay IHT if you died together and this is wrong.

caringcarer · 21/11/2024 13:17

Cosyblankets · 21/11/2024 13:12

You have an allowance for IHT each of 325k.
If one of you dies first and their estate is below that then the remaining allowance is transferred to the other. So say you die leaving 300k there's 25k allowance left to transfer so your husband's allowance then becomes 350k
If you both die together the total amount is 650k so it makes no difference.

A solicitor recently did probate for a relative of mine who was widowed almost 30 years ago and he wanted the original marriage certificate in case he needed the allowance transferring over

Show quote history

It's very depressing.

CallMeDaphne · 21/11/2024 13:14

twomanyfrogsinabox · 18/11/2024 13:54

It's likely 40% has already been paid in tax so another 40% in IHT is 80% in total.

Show quote history

Except it really isn’t.

The vast majority of the 4% of estates that pay IHT are only in that bracket because of unearned capital gain from house price increases.

On which no tax at all has been paid. **

Cosyblankets · 21/11/2024 13:12

caringcarer · 21/11/2024 00:41

I gift the £3k money each year to DC and £250 to DGC. Then I gift them out of my regular incomings which is all perfectly legal. If my DS gets married I'll gift the maximum I can. I'll pay for their holidays too. I DH and I die together they'll have to pay IT. I just really hope Labour get kicked out and it gets reversed by whoever gets in next. I've also put 4 houses into a limited company and will be taking legal advice if I can just add DC and DGC as shareholders. Then I think they'd only pay 19 percent as they take money out. Not sure of what else I can do. I'll probably gift a house to both DGS's and hope to live 7 more years or not sure if Labour are planning to change it to 10 years. They'll have to pay tax on the rest, but I'll be leaving some to the Cats Protection League so that will reduce IT.

You have an allowance for IHT each of 325k.
If one of you dies first and their estate is below that then the remaining allowance is transferred to the other. So say you die leaving 300k there's 25k allowance left to transfer so your husband's allowance then becomes 350k
If you both die together the total amount is 650k so it makes no difference.

A solicitor recently did probate for a relative of mine who was widowed almost 30 years ago and he wanted the original marriage certificate in case he needed the allowance transferring over

caringcarer · 21/11/2024 13:10

BIossomtoes · 21/11/2024 12:11

We’ll see. Her competence or otherwise will only be determined with time.

Show quote history

Her budget proposals will send inflation back up accordingly to the BoE governor.

Clavinova · 21/11/2024 12:59

cardibach · 21/11/2024 11:35

There. Are. No. IHT changes. Except. For. Agricultural. Relief.
Honestly this thread is wildly ill informed.

Show quote history

Non-agricultural businesses and inherited pensions are also affected;

Changes to Inheritance Tax (IHT) proposed during the Autumn Budget 2024 include significant changes to Agricultural Property Relief (APR) and Business Property Relief (BPR). Pensions will no longer be outside the scope of IHT and liable to 40%.

https://www.rossmartin.co.uk/autumn-budget-2024/8058-inheritance-tax-iht-autumn-budget-2024

Rollercoaster1920 · 21/11/2024 12:42

@cardibach "There. Are. No. IHT changes. Except. For. Agricultural. Relief."
Did you miss that DC pension pots are now included?

That's the but that I think will unfairly hit single parents, not in final salary schemes, living in the SE, that die from approx age of 55 to 75.

BIossomtoes · 21/11/2024 12:11

caringcarer · 21/11/2024 12:03

If you read my previous comment you replied first too my point was she is incompetent.

Show quote history

We’ll see. Her competence or otherwise will only be determined with time.

cardibach · 21/11/2024 12:04

caringcarer · 21/11/2024 12:03

If you read my previous comment you replied first too my point was she is incompetent.

Show quote history

Sorry, no idea what you mean.
Your post, though, mentioned Non Dom as an example. The point being discussed is IHT.

caringcarer · 21/11/2024 12:03

cardibach · 21/11/2024 11:45

What’s that got to do with a thread on IHT?

Show quote history

If you read my previous comment you replied first too my point was she is incompetent.

cardibach · 21/11/2024 11:53

Mrsgreen100 · 21/11/2024 11:52

No spouse involved

Half a million then. Not a bad tax free sum for your descendants.

Mrsgreen100 · 21/11/2024 11:52

No spouse involved

cardibach · 21/11/2024 11:47

Mrsgreen100 · 21/11/2024 11:43

I loathe inheritance tax , unless it’s for super wealthy ie in the multiple millions etc
i have worked hard my whole life , my home whilst cheap ish when I brought it is now worth a lot , I’ve already paid tax on every penny I spent on it and the fact that I can’t leave it to my child with out paying tax is maddness it will have to be sold tax paid etc
better Would be that my grandchildren could be raised there etc ,

They can get a clear million if you have a spouse, the. Pay tax on whatevere is above that. Seems ok to me. Currently 4% of estates pay any at all, expected to maybe rise to 8% due to property price 8ncrease and pension changes (which also won’t affect people who plan to use their pension to support themselves in retirement, as is it’s purpose).

Edit: you haven’t paid tax on its increase in value though. And your children haven’t paid tax on any of it. All money is taxed when it changes hands - multiple times.

cardibach · 21/11/2024 11:45

caringcarer · 21/11/2024 11:43

She made Non Dom changes too.

Show quote history

What’s that got to do with a thread on IHT?

caringcarer · 21/11/2024 11:43

cardibach · 21/11/2024 11:35

There. Are. No. IHT changes. Except. For. Agricultural. Relief.
Honestly this thread is wildly ill informed.

Show quote history

She made Non Dom changes too.