To think it’s unfair that some people get inheritance while others start with nothing?

Denmark also has the highest income tax in Europe and capital gains tax at 28%. It’s all swings and roundabouts.

FWIW IHT in the US kicks in at around $13m plus and the top rate in Denmark is 25%.

@Timefordrama take a look at the detail of each country’s IHT, ie the amounts at which it kicks in. Then add in the circumstances. Perhaps start with the USA and Japan.

https://en.m.wikipedia.org/wiki/List_of_countries_by_inheritance_tax_rates
We're not exactly an outlier, are we?

@xenia, yes it’s almost like in the UK the higher rate taxpayers are somehow the bad guys despite paying a top rate of 45% and contributing vast sums to the Exchequer whilst generally costing the state very little.

It’s 40% only above a certain level, not 40% of the whole lot. Most people’s estates pay nothing.

Perhaps we should add up people's life time income tax, NI and stamp duty and council tax, VAT, insurance premium tax, capital gains tax etc and once they have paid over a certain sum their estate is tax free as a thank you for paying so much towards the state/the less fortunate. Instead we kick them in the teeth and encourage them to move abroad in effect.

I understand how it would be enforced in theory, but in practice, it's spectacularly easy to avoid.

https://makesworth.co.uk/inheritance-tax-if-you-live-abroad/

Same way any UK tax liability is enforced.

But how is it enforced?

It's already more or less closed. You have be overseas for a fair amount of time before death before you can avoid IHT. Most UK citizens want the benefit of the NHS in their later years

Yup, yet another objection to IHT is the many ways it can be avoided and minimised. Surely not a good basis for a tax.

Sounds like a loophole that needs closing!

Under UK law, the inheritance tax regime follows that of the testator, not the beneficiaries. Hence, there is a big incentive for people to move their assets out of the UK and dying in a low tax regime to escape UK IHT clutches.

My home country has no IHT. Many countries do not. The UK is an outlier for having IHT and not only that, at the extortionate 40% rate with such a low nil rate band of 325,000.

@blueshoes and @AzurePanda

I guess this only works if the people inheriting live in a low / no inheritance tax jurisdiction? Surely it doesn't matter where you live and have your assets when you die Vs where your beneficiary lives. If they live in the Uk they still pay tax on the inheritance as income ()325k is tax free I think).

My father died before I was five. My mother died before I was 16. My dad left me £1,000 which she spent on a few Christmas presents for me before "lending" the rest to my brothers who'd already had theirs. My mother left me £200 which the brother I lived with doled out in handfuls of loose change that I could spend on his fucking kids. I left to live in a council flat with my boyfriend and future husband. We had nothing accept a second hand cooker my aunt donated £20 towards and a flea egg infested old sofa from an acquaintance of my social worker. Thirty+ years later, we still live in a council flat. It's spotlessly clean, nicely decorated and we have nice things that we had to work our fingers to the bone for. No benefits for us, as an honest working couple we were entitled to zero state assistance before anyone makes that false assumption. I'm now dying because my shitty life and my husband looks to getting sick now too.

Is that a miserable enough existence for you or do you want the government to swoop in and help themselves to the four thousand we've finally managed to save up, just in case we leave it to someone you feel is undeserving.

I say best of luck and good on you to anyone that got or is planning to give an inheritance. I'm not bitter enough to hope their family wealth is taken from their wider family.

@Anonym00se yep I posted that because it really gets up my nose that the 'we worked hard for it brigade' seem to think the rest of us who also worked hard for what we have might not be in quite such a fortunate position to be leaving squilions to our nearest and dearest and accept if we want a semi functioning society then 'someone' has to pay -

Alternatively they could support my personal preference for a scandi style system - higher wages, higher pensions, no NI , no council tax, no IHT, very cheap and good childcare and far more good quality social housing but 40% tax up to 57% tax

@Anonym00se if you give away all your assets so you end up at the mercy of the State for your care needs then god help you. I wouldn’t wish that on my worst enemy.

My sentiments entirely. I’ve always said that if our four weren’t happy with £250k each tax free and 60% of the rest our parenting has been a complete failure.

Absolutely this. The amount of people who will decry ‘benefit scroungers’ in one breath, and then state that they’re giving their DCs their house to avoid care costs, without considering they’re cheating the system too. But it’s only cheating when others do it.

With regard to IHT, if I end up in the very fortunate position to pay it, I’ll be very happy to. The DCs will still inherit ONE MILLION POUNDS tax free, PLUS 60% of anything over a million pounds.

If they’re not happy that that’s enough, I’ll leave it to the donkey sanctuary.

@blueshoes yup, the whole experience with the Non Doms leaving the country in recent months has proven that. Snap on the bringing forward of retirement.

@AzurePanda I too am not born in the UK. I am a naturalised British citizen.

Me and friends who came to the UK from my country are already being advised to consider moving out of the UK and losing their UK tax residency to escape the punitive IHT. Yes, laughable that after all the additional rate tax I have been paying over the years, the government now wants to take 40% of assets which I have always planned to leave to dcs. I will also bring forward my retirement since there is no point contributing more into pension.

This money tree refuses to be shaken down any more.

Newsflash: LIFE is unfair. And we generally only carp about it when we are the ones not benefitting from the unfairness 🤷🏻‍♀️

100% @blueshoes . I’m not British and despite having lived and paid taxes here for over 30 years we will be moving our assets back to my home country which has zero IHT for our retirement. The idea that we would give the British state 40% of what we have created over our own children is laughable given we have an alternative.