To mention to my healthy parents in their early 70s to think about avoiding inheritance tax

[Soamiasnob]

Its a morbid subject, but I know you have to sort these things out 7 years in advance to avoid IT.

Aibu to mention that they should think about it now?

They have inherited a lot from one side, and I know do want to pass it on.

I don't understand the argument that it is somehow more worthy to give your money to the Government via inheritance tax rather than to provide financial stability for your family

Did anyone here say it was?

The roughly £3 billion a year that inheritance tax raises is far better spent ensuring financial stability for your family

Surely true of income tax then? if you look closely at the coins/notes can you tell which came from where?

That's the thing. All of peoples' arguments are against tax full stop, not IT.

I would far rather spend the income tax I pay on myself and my family. Should we just stop all tax then?

this is the choice, binky, with iht. you can spend it on yourself or family and friends, or you can leave a high percentage of it to the government
of course, nowadays in the south it is less of a choice if your house is worth a lot. iht should be raised imo so it only kicks in at higher levels. there is talk of it

Something that keeps coming up on IHT threads is how it is unfair that people are being taxed twice or three times on the same income.

It has already mentioned by others that you are taxed twice on all sorts of things and so even if that was the case for IHT, its not unusual.

The actual position for most estates IHT isn't a double or triple tax as most of the wealth is unearned increases in house prices.

An example: a couple bought a house out of taxed income for £200,000. They paid stamp duty at 1% (most people now dying bought houses well before the big stamp duty increases). By the time the second person dies it is worth £1m and so the estate is liable for IHT. Assume the couple spend all their other savings on their retirement.

IHT of £140k is paid and the beneficiaries get £860k. How much tax was paid in total on that £860k?

If we assume income tax of 40% was paid on the income that funded the house purchase, along with the stamp duty and IHT the total comes to £273k. This triple tax works out at 24.3%, way less that current income tax rates (due to the huge £650k that is tax free).

It really doesn't need cutting - it's far too generous as it is.

I'd be having a conversation about Lasting Powers of Attorney first, then wills and how they want things distributed.

And I'd be having that conversation soon.