To think this is the fair and kind way to fund social care crisis

[BarnabyBungle]

So two people each have £325k in assets.... one dies of a heart attack suddenly and leaves inheritance for family (and/or anyone else they so choose), the other gets severe dementia and spends years in an expensive home, and spends all but the £14k threshold left when they die.

Hardly fair is it?..... But then it’s unreasonable to increase general taxes to fund care as it would mean those without substantial assets would be paying for enabling those that did....

Surely lowering inheritance tax threshold and/or increasing the rate would be fair. If the limit were, say, £125k, and the rate was, say, 40% on inheritance above to the current £325k threshold, both imdividuals would pay £80k inheritance tax, enabling both to pass on £245k, rather than one passing on £325k and the other £14k.

Not only would this be far fairer it would help alleviate the anxiety of those with dementia knowing their condition means they will mean their assets will be dramatically reduced as their disease progresses.

Why should someone without and inheritance pay more taxes to allow those with an inheritance to pass it on.

Because that's how public services are funded. How about this: anyone who owns a car worth more than £20,000 should be forced to sell it if they get admitted to hospital for any reason. I mean, why should the rest of us pay tax so that Joe Bloggs can have a Jag? And anyone with a sky TV subscription should have to pay to see their GP. After all, we shouldn't be paying taxes so that people can watch Game of Thrones. Stupid argument, because the taxes aren't funding inheritance or anything else, they're funding the public service.

BigBlueBubble, the mother of a friend of mine is being made to sell the house in which she lives to fund her husband’s early onset dementia.
As the previous poster said, if one partner needs care but the other partner is still living in their jointly owned home it’s not included in the means test for care and they aren’t made to sell it. So not sure how she’s being made to sell their home as that doesn’t happen?

The idea that we can use assisted suicide to save social care costs is ridiculous.

What about diabetes? Lots of those older patients cared for at home have sight loss or amputations. A foot amputation costs about 40k. Too pricey? Time to kill yourself then?

Don't be pretend you are saving money for your children. If you want your children to have money - give it to them now! Don't pretend it was always for them when you squirrelled it away entirely to make your own life comfortable - oh, until you conveniently don't need it because you are dead!

The house would be disregarded for the financial assessment, but it's often the case that the person remaining at home cannot then afford to live there and pay care home fees (all of someone's income except disregards are required to pay towards fees even if the LA are funding). Or they may have decided on a more expensive home and are paying a top up. I've seen couples downsize for financial reasons when one person moves into a care home and this may be translated as 'they have had to sell their house' I suppose?

The argument seems to be to have higher IHT rates/lower threshold to even the playing field as no-one should have an inheritance! That is frankly ridiculous.

Wtf?!? My argument is precisely the opposite!

I’m advocating changing the IHT thresholds and rates so everyone who has wealth can pass on most of their wealth through inheritance! Rather than the current situation where those unfortunate enough to need prolonged social care can’t.

That makes sense @ashtrayheart I suppose if my DH suddenly needed care I’d be allowed to stay in our house but couldn’t afford the running costs without his salary.

In practice though, they are

No they're really not. They are dead. In practice their heirs are paying tax.

*Wtf?!? My argument is precisely the opposite!

I’m advocating changing the IHT thresholds and rates so everyone who has wealth can pass on most of their wealth through inheritance! Rather than the current situation where those unfortunate enough to need prolonged social care can’t.*

I am not saying what you want doesn't have good intentions, but jus that I can't see it getting the effect you want.

I am advocating increasing the rate of income tax for everyone or that everyone pays that equivalent into a 'social care insurance' so everyone pays a little more. That money funds the social care so that no-one has to pay out of their own funds if they end up in care.

Those who do not end up with dementia etc and who say die of a heart attack may pay a little more in their life for something they do not need but they are covering the risk in the same way you may never claim on your car insurance but you still have the cover.

I pay tax to cover the risk that I need help from the NHS, police etc, so why not adult social care. You can't say that is unfair if everyone pays according to wealth (as you do from the income tax system now) to cover all services.

The risk on inheritance tax is that you may think you are levelling the playing field, but instead if everyone has a lower limit, those with more will give it away, spend it etc to save tax as people do not want the government to take what they have.

It is fair for everyone to be able to pass on wealth and assets and I don't think those who need care should be penalised, but if it is not collected in tax or a compulsory flat rate insurance (i.e. those with family history do not get ridiculously high premiums) during lifetime then older people will just start giving away, spending or otherwise getting rid of assets to cut their tax bill and the change won't work.

Surely somewhat higher rates and/or a lower threshold for IHT would be fairer, with no ‘long term care’ tax

OP... in the last tax year IHT raised about 5billion with tax @40%, we ve a 5 to 7 billion shortfall in adult social care, according to Kingsfund/Nuffield Trust.
You'd have to double IHT across the board and all that would do is either make folk fritter their money away or avoid paying it.

As myself and CornishMaid suggest, adult care social care insurance and pooled risk is the way forward and i'd add with IHT ring fenced for social care.

I’m advocating changing the IHT thresholds and rates so everyone who has wealth can pass on most of their wealth through inheritance! Rather than the current situation where those unfortunate enough to need prolonged social care can’t.

And who is going to pay for the years and years of expenisve care they need before they die and make their kids rich? The rest of us?

And who is going to pay for the years and years of expenisve care they need before they die and make their kids rich? The rest of us?

IHT would increase from the date thresholds were lowered. Everyone who dies and has assets above the threshold pays, so you would have extra taxes coming in (paid from inheritances) to pay for those needing care

And who is going to pay for the years and years of expenisve care they need before they die and make their kids rich? The rest of us?

Also, it’s the “rest of us” who are paying ip front with the current system, as houses are only sold when the person dies.