What do you think of Burnham's plans re inheritance tax?

[JoyousOpalLemur]

He has said in the past that he wants to abolish inheritance tax and replaced it with a social care levy on inherited assets, which will incorporate unused pensions.

I don't totally understand this if I'm honest - I think it means everyone will be dragged into the inheritance tax threshold, but it seems like a fairer tax than what currently exists, and it's there for a purpose (to fund social care).

What do you think?

https://www.independent.co.uk/money/burnham-prime-minister-money-taxes-mortgages-bonds-stamp-duty-b3001078.html

well, it did though

Inclusion of pensions in IHT estate is absolutely huge. It screwed lifetime planning for many families. They also sneakily added NI to dividends and interests tax and NI on pensions contributions. It might seem nothing to lower earners, but it affected the same group of higher earners yet again.

Surely spouses have to be exempt. How about unmarried couples? DD owns her house in her name only, if anything happened to her, her partner would have no way of paying 10% of its value without selling it and making their children homeless.

Did we vote for this?

And me, not my definition of handsome!

One hopes he does not include everyone in this scheme...

Will they fuck. You reckon all the pensioner owners of property and assets over the threshold, recieving triple lock pensions, are going to move abroad in their old age? Ba ah ah ah

why? if everyone is to receive free care, everyone should pay?

I know how our democratic system works but I can't believe we will allow this kind of policy to be implemented under a new leader without another election. This is a massive shift and will impact people hugely so the people should have their say.

For anyone who supports this policy and opposes another election, imagine how you would feel if Reform got into power and two years later began to announce right wing policies that were a massive departure from their manifesto. Where would the line be before you wanted a vote?

absolutely agree

I agree it would be better. But...

The way it works is governments can put forward policies and these have to be voted for by all the MPs. If they have a majority of MPs onside they can get it through. Failing that they can use the whips but if a policy is very unpopular with their own MPs as well as the opposition it won't go through
The next step is the House of Lords who also have to approve the bill. If the policy is in the parties manifesto this step is much easier as there is a convention the house of lords don't opposed manifesto promises. If it's out of the blue and very controversial it's going to struggle to be passed there.

So in theory, Parliament decides what gets into law not just the PM. The big danger with manifestos is people assume "they won't actually do it/parties always break their promises" combined with "it would never get through the HoL and be approved into law". I can already see people making that argument for Reform/Restore (especially with regards noises about remigration) if those policies get into the manifesto it's much more worrying than them policies that aren't in it. Not everyone reads/believes manifestos. The other danger is parties making noises about something and not explicitly putting it in their manifestos but people who thought it was what they were voting for then getting mad at the process if e.g. The HoL blocks it. Then you are into enemy of the people territory and potentially intimidation.

So no, if Andy Burnham was able to get such a change through the house of commons and the house of lords I don't think it's also necessary to call a new election first. However doing so would give him more of a mandate to do so and make it much easier so it's probably better.

He could take a mortgage and inherit 💯 of it for just 10% - or sell it and live somewhere he can afford? Getting 90% of a house for free is a good deal no (bereavement aside)

I guess even Labour realise that Andy is unelected and has no mandate, so they are now trying to do some clown contest to show that he won party leadership. They are embarrassing themselves

There’s nowhere to buy cheaper than what they have, and why should he pay 10% to stay in his own, and his children’s home. The home that he has poured money into over the years, (which he has gladly done even though he doesn’t own it, as his children benefit from it, before any says he’s mad to put money into a house he doesn’t own etc).

Can he not get a mortgage for 10% of the value? Who do you think should pay for everyone’s care if some of them own expensive assets?

Well apart from by marrying her. Which last time I checked was neither illegal nor difficult to do.

DM has a modest house in the north, has worked hard all her life and has little to show for it.

She will likely need a nursing home as she is starting to show signs of dementia, but she would prefer to live at home as long as possible. With carers / adaptations. She prefers quality over quantity and already has PAO, NDAR and RESPECT forms in place.

The thing I like about the current system is that in selling her home to fund care we have a choice about where she goes and can pick a "good" home. They should all be good, but DM had a struggle to get DGD in a home she liked rather than the one they preferred but she had significant concerns about the standard of care (he had no assets).

I would prefer her to have good care and choice than to inherit.

If I were to inherit I would resent a 10% tax. Without it we could finally get on the property. With 10% tax we would still be stuck with property prices too high to buy.

The objective is to create a permanent funding mechanism for social care rather than relying on general taxation. Burnham has advocated variations of this idea since his time as Health Secretary and has revived it repeatedly in recent years.

But you wouldn't resent the system staying as it is and you inheriting £23k max? Odd.

No, because it's worth it to choose her care and make sure her last year's are the happiest they can be. Rather than the local authority sticking her in the home with the most vacancies and (last time we looked) not somewhere I would want her to be due to the care and activity levels.

Not all care is equal. It should be, but it isn't and I would rather pay with her house than have her live in misery.

A better way to fund social care would be to each person to take out an insurance policy to indemnify them for cost. Very few people actually need to go into social care so policies should not be too expensive.

Any change that will create winners and losers as it is made fairer will generate so much pushback it will probably never happen. If Jeremy Clarkson can gain support for changes that still leave wealthy landowners paying half the tax rate of ordinary people, just think how much anger real reform will cause

You can do that already- very few do (Lifetime Care Plan - Aviva )

I think one idea put forward is it effectively works like a compulsory insurance scheme for social care. In which case theres no reason in theory you couldn't choose the care, using the money that would be paid out when needed. However because not everyone can afford to pay a hefty insurance against needing social care, it makes more sense for the government to basically pay it for them and then take that money back as inheritance tax. Sort of like the government lending older people money to buy insurance and being paid back when they no longer need it (because they're dead).

So I don't think it would mean you had to accept the councils decision about where your mother goes. But it's just an idea now so who knows.

It’s not that easy even if you pay. My SIL has just been through this and you only have the option of suitable homes with vacancies at the time you need them- she hated all the options and said she wouldn’t let a dog live in them despite self funding

🤢