To not see the problem with inheritance tax

[AgaPanthers]

"Millionaire lingerie boss Michelle Mone has called for inheritance tax to be axed to stop the government spending her money when she dies."

Surely it's better than the government spending her money while she's alive? I mean they have to get their hands on people's money one way or another, and if anyone doesn't need it, it's the dead.

"I work really hard every single day - like a lot of people - for my children and for my children’s future,’ she told BBC 2’s Newsnight.
‘I want them to have that little nest for their future and for their children, and I don't see why I, others should work extremely hard, pay your tax and then when you die it is like a double whammy."

I work hard for my children too, so that they have a good education and can make the most of their talents. But I don't really see why my grandchildren, for example, would need to receive my millions (if I had any!) untaxed.

Others seem to feel the same way, giving to charity www.news.com.au/finance/work/tycoons-who-wont-give-money-to-their-children/story-e6frfm9r-1226702468883, rather than enabling several generations of progeny to be idle wasters.

For the record, the IHT rate is 40% above £325k, but for a married/civil partnered couple, the allowance is transferrable, so a married couple can leave £650k (which is 32 years labour at the average wage.) entirely tax free to their children.

[merrymouse]

That's what I mean - its not so much the rate or the threshold, the problem is that current rules don't deal fairly with situations that aren't Gladys and Herbert dying in their 80's after a short illness.

[CelticPromise]

The thing is if you own your home in London you're not necessarily ' rather modest'. If you bought recently you must be well off. If you didn't you have benefited from untaxed capital gains. I have sympathy for the unfairness of the double band and would abolish it. Perhaps there could be a presumption of a life interest for anyone living in the house.

[Kendodd]

Well guess who on this thread isn't likely to be inheriting much.... Easy to give away when it isn't YOUR families cash.

I'll be hit by IH (twice, divorced parents) and so most probably will my children, and I don't just have one child, the money will be divided by three. I'm still in favour of it and think it's about the fairest tax around. I would rather my children pay tax on a massive great windfall they have done nothing to earn than have to pay more on the money they work hard every day to earn and struggle to make last till the end of the month. Plus I think we should all (including my own children) stand on our own two feet in life.

[tryingreallytrying]

It's not true that all income was taxed the first time and therefore should not be taxed again on death.

In practice, the vast majority of inherited wealth now will come from unearned gains in house prices. Why on earth shouldn't that be taxed???

[fayrae]

It certainly shouldn't be as high as it is, or levied on estates as small as it is. Most people with money will arrange their affairs to avoid it, anyway.

[Viviennemary]

I think it should be raised to say £1m for a married couple. Which would take a lot of families out of it altogether. And I don't really agree with most people who have money can avoid it altogether. A friend of mine says she is signing her house over to her DC's. I'm not an expert but I don't think it's quite as simple as that.

[Birdsighland]

I think it's interesting how many people say that property paid for out of taxed income should not be allowed to be transferred to a persons relatives after death according to their wishes without being taxed separately and heavily again because it fosters inequality and the taxes pay for public services. Surely this is equally true for any transfer of income or benefit from a parents income in any guise from a parent to a child while the person is still alive.

There are many parents (most) who help their children out financially or buy them things when they are past 18 years of age. Letting them live at home, using your car/washing machine, feeding them, buying a t-shirt, benefiting for winter heat is all helping financially. Should those recipients have to declare everything and pay tax on it as benefit in kind. Just because their parents are alive, should their children benefit tax free from these gifts. It is not just inherited wealth after death that gives rise to inequality of life chances. As people under 18 also pay inheritance tax, maybe support over a certain amount for your children should be looked at as well. That holiday in Cornwall is definitely a benefit in kind. Or Mandarin lessons for them paid for by you. This is paid for by the same taxed (hopefully) income as the mortgage repayments are made.

The law does not treat people equally. Lots of people are given exemptions for various reasons and can benefit from various schemes and loopholes the state does not close. Their tax would also pay for state services.

I think it's the ordinary person who will be the one to pay the inheritance tax on a property that was bought on borrowed money (with interest) that was paid for on income left over after tax. Maybe they won't have enough spare income left in life to help their kids out as they would wish.

I don't know if it would be unfair if there was no trust, scheme, ferreting away or royalty beyond it's grasp. That is different from threshold though. Have the thresholds for inheritance not been raised in donkeys years so it now hits people it was never designed for?

I heard an idea of a universal payment to everyone mooted. Then any and every income and benefit above this taxed. For everyone. I thought this was an interesting idea. The 'each according to their needs' would have to be sorted out though.