To think post covid19 would be a good time to completely overhaul inheritance tax?

[DogsDinner]

I know a couple of only children who are likely to inherit the best part of £750,000. Other families where the kids will inherit hundreds of thousands each.

Not a penny tax will be paid on this money.

I also have friends who will inherit nothing, indeed will probably have to scrape together the money to pay for their parents’ funerals, and in turn are unlikely to be able to leave much to their children.

AIBU to think that people who have probably already had a very good start in life, should not then go on to be further advantaged by inheriting such staggering sums tax free?

I’m not a socialist, and I do think parents should be able to leave their children something, but surely it should at least be taxed?

It honestly seems to me to be the obvious place to start raising money as we try to repair the damage to the economy.

I was left money last year, my brother got the same. It was my parents wishes of course and why not? What would you have wanted me to do? Donate it to a dogs charity or something?

Anyway.. I can assure you that we paid well in excess of 150K IHT. I don't mind, it is what it is.

You're wrong to assume that anyone receiving these sums is 'vastly wealthy' though. I'm not that at all. Of course I'm very comfortable and I'm grateful to my mum and dad. But I cannot stand all the bitter whiners going on about something that actually doesn't affect an awful lot of people. Just get on with your day or something

Of course someone "working hard" in a minimum wage job because they have few qualifications and no interest in promotions etc is never going to be rich - why should they?

Ah yes. Lazy feckless buggers they are.

I'd like to see a raising of the threshold at which people start to pay income tax. Say to £20k. Inheritance tax should be left alone. It's money already taxed.

Inheritance tax should be left alone. It's money already taxed

Which tax has been paid on property gain?

I am in the end stages of probate on my DDad’s estate. Including the house, it’s a lot more than 325k. No tax due as the liquid assets are just under 325. The house is left to me as a child of the deceased and therefore has no taxable value provided it is sold under probate / as part of the estate and not put in my name. Not sure if there is a limit on house value for tax purposes but if there is, it doesn’t meet it as I’m not liable for any IHT.

OnlyFools,

I certainly wouldn’t describe someone who’s mum died when they were 8 as lucky. Nothing could make that alright. But you were unlucky because of the circumstances life dealt you, not because you had to pay inheritance tax.

Are you sure about that @NordSjoen? It doesn’t sound right to me. It certainly wasn’t the case when my parents died five years ago.

Anyone who is receiving inheritance is privileged and it most certainly should be taxed. And I say that as an only child who will be the sole beneficiary of my parents' will.

Well I got the solicitor’s final account yesterday so pretty sure.

I also checked on the Which? IHT calculator site to be sure.

All governments need to make sure that citizens believe they can pass on the wealth they accumulate to their descendants.

This ensures that they do not fritter it away on luxury living. By doing this, the government can then charge them £1200 a week for residential care in their final years. This in turn subsidises the care costs of those who have squandered their money on cars and holidays, or of those who never accumulated any money in the first place - allowing the local authority to pay only £400 a week per person for identical care in the same home.

It’s all part of a sneaky plan. If people knew what was going to happen they would spend it all up front and then let the LA meet their care costs.

Wow, things have changed - or you’ve got a very clever solicitor!

DogsDinner but you’re painting a picture that everyone who inherits has a golden life.
I think it was disgusting that I had to forgo money that was mine to a country that has repeatedly let me and my family down.

I stand corrected. No tax on property value gain except in the case if you inherit property hang on to it for a few years then sell it there will be capital gains tax to pay if it increases in value during that time. And of course capital gains tax is payable on second homes. I think at the moment inheritance tax is set at a fairly reasonable level. But as I said before I'd like to see less tax payable by low earners.

The current IHT rules may be unfair but that is a drop in the ocean compared with the far more important issue of multinational corporations lobbying their way to tax breaks whilst paying their workers so poorly that those workers have to have their pay subsidised by taxpayers.
We are all paying for benefits and tax credits that have to be given to low earners whilst their employers are given tax breaks. Amazon is a case in point - Bezos pretends to be charitable but his donations amount to a pittance compared to what Amazon should be paying in tax.
It would be better to concentrate on how much money we all lose by supporting these corporations and only then start looking at whether a few individuals have gained unfairly via IHT.

@Statistician999, firstly the government doesn’t get care home fees, they’re all privately owned. Secondly, many homes won’t take LA funded residents because they have a waiting list of self funders. Thirdly, nobody with an atom of sense would want to be LA funded and end up in the kind of shithole the council deems appropriate.

Crap idea. And the money will be taxed - inheritance tax - on money that has already been taxed!

Inheriting money helps the next generation get on the property ladder. Why should folk who save all their lives be penalised?

No thanks. My parents worked damn hard and never wasted money like other families did. Why should they be penalised because they chose to invest and save to own a home, rather than buying new clothes, furniture and cars etc? Or to take advantage of education when others didn’t? It’s offensive.

Looks like (from tweaking the figures in the Which? calculator that I squeak in under both thresholds for combined assets plus house value. Well done, Dad!

But because my dad had a successful career before life turned to shit, we had a nice house, and no one gave a damn to help us, all let down my this country over and over again. You call me lucky?

I’m very sorry for your losses. But yes, you are far luckier than those who have not only lost but had to apply for funeral grants for the most basic of funerals because there is no money. And you’re luckier then those who have to deal with loss whilst also living in poverty.

Everything else being equal, receiving any inheritance is very lucky indeed. Receiving such a large inheritance that you’re liable for IHT is an immensely privileged position to be in compared to the vast majority of the UK.

Tax is paid at 40% on estates over 345k, which is currently only about 4% of estates in the UK!

Save your anger for the Tesco’s and others of this world who pay shit and get that topped up by the state so that people can get by. Working poor.

Viviennemary,

I would actually agree with raising the income tax threshold, although that obviously benefits the well off too.

However, the money to run the country has to come from somewhere, no one wants to pay it, taxing unearned inheritances seems a lot fairer to me than taxing people earning less than £10 an hour.

Look up moral hazard, by the way. You can’t remove the incentive to save, from a public policy perspective.

CeriseClementine firstly I paid inheritance decades ago before the limits changed.

Secondly I think I deserve every penny of my inheritance having no grandparents, no safety net in life.
All of us can find an example of someone less fortunate- but it’s all relative. There are plenty of people who may never inherit but have their mum and dad, whose children have grandparents. I am well aware that those things are worth more than money, but I was robbed of those my circumstance I was then further financially robbed by hmrc!