Labour should increase inheritance tax to 50 per cent

[Tummyachey]

If they did this it would raise billions of pounds - while avoiding raising taxes on working people. Exemptions should be put in place to protect small businesses; I accept this would be complicated, but they need to try and make it work.
So much money could be raised and it would also encourage earlier wealth transfers which would stimulate the economy. In addition, it would help redistribute wealth thus reducing inequality.
There would be political backlash, of course, but they need to get the economy growing and should act now so that the results are visible in time for the next general election.

I understand that but the question I asked was “how would Reform raise revenue?” And the only answer I got was to reduce spending on immigrants - this would not raise enough money to do everything Reform is promising.

That is a good joke.
Thanks! 🤣

Ask Rachel.

At least if people pass on much more, much earlier to their DC that will generate more spending which will stimulate the economy.

Nearly spat my wine out reading this. What an analogy, I love it, and wholeheartedly agree.

Ha yep

It costs between lions every year to accommodate these immigrants into 4* hotels. Once we stop paying this money out we can work out how much tax is needed to run the country.

Husband dies and leaves everything to wife. No IHT because of spousal exemption
Wife dies and leaves everything to kids including property. Assuming no lifetime gifts, she has:
Her own £325,000 Nil rate band and own Res NRB of £175,000 = £500,000
Her husband's unused NRB and RNRB = £500,000
IHT only payable on the excess over £1m

So you inherited a very substantial sum. Anything over £1 million would have been taxed at 40% … not the whole lot. You do realise that?

People that actually want this are just bitter and nasty that their parents have nothing to pass on to them, because if they had they would know just how unreasonable this would be.

I would also say those same bitter and nasty people have no concept of what it actually takes to have a little something to pass on their children, and have a very entitled mindset, those assets have already been taxed.

Your benefit money is still safe, go claim it from somewhere else not from hardworking people, with modest assets that have already been taxed through the nose on.

A 10% IHT across the board then a tapering increase for larger estates seems sensible. It's unearned money for the individuals receiving it, and a great deal of inheritance is down to the huge property value increases that most on here have such issues with.

And no, I'm not bitter and nasty 🙄, don't claim benefits, work hard, have savings and a in line for inheritance at some point.

The flaw with this is that it assumes the property is still owned by the person at death. To reduce IHT you have to keep the property even if the elderly person moves into a home. This just increases the number of homes left empty.

You can voluntarily opt to pay more when the time comes, so do feel free to do that.

”Redistribute wealth?” Why should I give my family’s wealth to you?
Amass your own.

Are you allowed to just give your kids ownership of your house when your getting old? I have 1 son, already thinking about how I can gift him my house before I die so the greedy work shy cant get their hands on it! (Im only 45) but threads like this make you think about these things.

Have you added the residential nil rate band and claimed for that, it gives you an extra £175K of relief on property.

You can give it to your kids but if you're still living there as before it will still be included in the value of your estate and so subject to IHT.

He was childless and leaving it to nieces/nephews so RNRB is not available

“A little something?” You get £1 million before it kicks in.
Also, a huge amount of inheritance is down to huge property value increases - not down to how “hardworking” your parents were at all.
The country is spending more than its raising so we have to find money somewhere. Better it came from IHT than from income tax on living, working people.

For several reasons this is a bad idea, if you continue to live in the house then it achieves nothing as it is classed as a "gift with reservation of benefit" and counted for IHT.

The only way round this would be that you pay full market rent and survive for 7 years.

There is also the issue of deprivation of assets, if you end up needing care the council could class it as deliberate deprivation and either refuse to pay towards care or take legal action to reverse the gift.

Another issue is that if your DC went bankrupt / got divorced etc you could end up loosing the home, as you would have no rights to it.

So generally it would be strongly advised against by solicitors as it offers very little protection against tax and care costs but has the potential to be ruinous to you.

You're still missing the point. If you live in a cheap area and own a home, then your child is allowed to keep your entire home. If you live in a more expensive area then even at current property prices and IHT rules, then unless you have a lot of extra money the family home has to be sold. Where couples have broken up so there is only one parent present, remember this is happening at £500k NOT £1m.

Would you feel the same if you had 2 or 3 siblings who’d inherit equal shares? Maybe not.
Perhaps a new law could raise it to 50% solely for only children.

I earned it, I paid tax, ni, interest tax, cgt on it why does the Government come to get another bite of my hard earned cash.

I should be allowed to leave all of it to who I want.

Yes that's right, take more money from people who probably worked hard their lives to save so the government can add it to the millions spent on putting people who snuck in into the country in hotels. Are you unlikely to inherit op? 😁