Potentially, another national insurance tax increase to pay for social care

The issues arising from private vs state funded index linked pensions is a whole other topic of itself, though obviously related.

I remember reading that in France if your parents / parents in law can’t afford care home fees. You will be asked to contribute and if it’s a no then the court will rule on the issue. About a third of people in care homes in France are being topped up by their children.

The idea of IHT bandings bringing the majority into the fold ud an excellent idea, @ErrolTheDragon

I suggest setting the minimum band so low as to be primsrily symbolic, and makes the threshold £50K or 100K (maintaining the caveat for couples who are legally bound) Shift the norm so that tje expectation is that everyone pays somrthing.

Many bandings are more effective and morr fair than a small number, which have a cliff edge effect.

If the self employed have paid 100% of their pension contributions, it’s their money. Maybe doctors should be taxed on the 23.7% the state contributed to their generous pensions? Why should the wealth creators be penalized yet again @ErrolTheDragon Also higher pension pots are taxed already. It’s just that some people never had the state contribute 23.7.%.

No wonder we have no growth.

Agreed, it’s so frustrating

The UK system is so ridiculous but there seems to be such low knowledge that it is a poorly working model and a global exception seems we will be stuck in this doom loop forever

Not to even mention all the ridiculous comparisons with the US when healthcare and other topics get mentions

Such low bar reporting often by the media

@angstridden2 Why should there be a cap on costs? If you have the money, you should pay all the costs surely?

I know how the system works. I worked in it for long enough.

You know how every care home in the country works, clearly.

I’m not going to get into an argument about this so will leave it there.

It isn’t. The LA has a standard maximum fee. Each home or group of homes takes a view on whether it’s viable to accept that. It doesn’t raise every self funding resident’s fee to directly subsidise an LA funded resident.

It isn’t how it works in some care homes but is absolutely how it works in others.

That isn’t how it works. The amount LAs allocate per head is frankly pitiful. When my parents were in a care home it was less than half the fees they were paying. Their care home wouldn’t take anyone except self funders because the disparity would have been too great. More homes are now doing this which is why there’s such a shortage of places for people who can’t fund themselves.

Taxpayer subsidies are spread among more people though.

I agree individuals should pay for their own care if needed. But say a place costs £700 per week I don’t think individuals should pay £900 so the LA can get away with paying £500.

I feel it’s very unfair that self funders subsidise LA residents in the same homes.

Not in the more expensive homes, their fees are completely beyond LAs’ parameters, subsidised or not. It’s no more unfair than expecting the taxpayer to subsidise them.

I’m okay with paying towards my care if I need it, but I cannot see that taking practically every penny I have worked long and hard for is fair. A cap on costs as was supposed to happen (£86,000 ish?) has now been ‘postponed’. I would have thought a system using a percentage of an estate to calculate the care cost cap would be fairer and take into account regional property prices.

I feel it’s very unfair that self funders subsidise LA residents in the same homes. As usual the very rich set up trusts or squirrel their money into offshore accounts, those who have nothing (either never earning much or spending not saving) are paid for and the squeezed middle gets squeezed even harder.

Unfortunately due to lack of social care, more and more is impacting on the NHS and hospital beds.
Many do not have the choice but to work and yet still care for loved one’s.

I am early 40’s with a grandma with social needs and a parent and two children who rely on me.

I work full time. There is only me to juggle everything. Luckily I’m in a good job where I’m paid a decent salary and work is flexible so I can make hours up when my son is in bed. Others are not so fortunate.

@ChipsNBrownSauce in a lot of countries the children will be responsible for contributing towards their parents care home fees. There might be uproar if we introduced this in the UK.

Social care and care of the elderly has fallen to rack and ruin under the conservatives. The financial figures speak for themself. The government needs to invest in paying and training care staff properly, a general register of carers and limiting the amount of profit provisions make. The U.K. needs to look at how other countries finance social care and how other countries provide efficient care processes.

I wouldn’t. The majority of people don’t need social care and I’d rather take the chance personally. If one or both of us need care our savings and ultimately our house will have to pay for it. Insurance would just mean insuring the kids’ inheritance.

So, people "purchase" an insurance product, that pays out minimum 1k a week. You're not very business minded, that isn't a profitable business model.

How much do you think this would cost per individual ? And how do the generations of unemployed never worked a day in their life pay for this insurance? 🤔 hint. they don't.

I meant adding a small tax (so, a bit of banding) not that 40% is small, @Badbadbunny !

Trouble is it's not a "small" tax. A flat rate of 40% goes against all economic/behavioural ideologies. When you're faced with a huge leap from 0% to 40%, you're going to take action to avoid the 40% portion. It's simply human behaviour - the "tipping point". You're going to look at your estate and do "something" to remove the portion over the threshold.

Fair better would be to have a lower rate starting at a lower amount, instead of 40% from £325k, make it 20% from £250k and then 40% from say £1million, if you only want two rates. Or even better have a starting rate of 10% and then 20, 30, 40 bandings.

For it to work, it needs more people paying it, more people being brought into IHT. As it stands, so few pay anything anyway, and they are highly incentivised to take tax planning actions to avoid it completely.

Since Rachel's budget, I've had numerous clients suddenly showing interest in IHT, mostly because of her bringing pension pots into IHT. Some of those had chargeable estates slightly over the threshold, but previous projections of IHT had shown pretty small IHT liabilities, typically £10-£25k or so, where the costs of setting up trusts or transferring assets to children etc., would have cost a few thousand, so really wasn't worth it - i.e. not breaching the "tipping point". Now some of those same people are facing IHT of £50k - £250k because of pension pots of £500k-£1m, and they're now queuing up to set up trusts and transfer assets asap to reduce their estates to get the IHT back down, but not down to £10-£25k, they're aiming to zeroise IHT! So, by trying to get more IHT, Rachel could end up getting less because it's just encouraging more people to undertake IHT planning actions!

They could just keep inheritance tax as it is, although agreed, it should be more, but the howling from the riches 5% of society who pay it would be deafening if it was increased.

Of course, the very richest (no idea of the percentage) don't pay their full whack as they can use trusts etc to escape it.
If the labour government manages to break whatever trust law currently causes pension funds to be inherited tax free (and I agree they should) I wonder if they can move on to getting the super wealthy to cough up a fair proportion?

Meanwhile, a small tax on everyone's residual estate doesn't seem like too preposterous an idea given we do already have a 'death tax' for some.

What a shocker..I have nothing left to give zero, zip, nadda…

There's a lot of working people who don't have homes to sell which is the problem ....

We have far too many people not working

Because we have shifting demographics so it’s no longer a pyramid, that’s the issue.