Andy Burnham should put the damn social care tax on landlords and big occupational pensions

[CurdinHenry]

Why is it always workers who pay

It shouldn’t be beyond the realms of possibility to have a Care insurance policy in the same vein as whole of life insurance, 12 million people are over 65, apparently just over half a million are in care homes or receiving care at home, So say 5%. Even at 10% Surely it’s a no brainer for insurance companies?

You pay for insurance, you get tax relief like with a pension, make it compulsory for employees and a perk offered by employers.
That would take a massive burden off the State.

A 10% inheritance tax would be great for my MIL. She went into a care home over 5 years ago with assets of about £450 000. In that time she's also received about £20 000 per year after tax in pensions so another £100 000. So far she's paid out over £340 000 to the care home so frankly paying £55 000 out of the £550 000 when she dies would be great for DH.

I'm not sure a 10% inheritance tax would be enough to cover care for all and I have no confidence that it would be ring fenced anyway.

What “social care” is the OP actually referring to?

Surely landlords are not expected to underwrite other people’s decision to have children they cannot afford.

No but you should only hve the number of kids you can afford.
Like cars.
There was an AMA the other day. Woman, 7 kids to 4 different men £4K a month in benefits -and has a cleaner. Takes the piss.

Life’s a lottery isn’t it. A few of Dh’s colleagues sadly passed away before they could access their private pensions.
Spouses only receive half the allowances.
Some will never see the inside of a care home or even need carers. It’s so hard to know who will need what in old age as well as all the other problems you encounter with an older age.

@DaisyDooleyplenty of people particularly 20-30
years ago had dc they couldn’t “afford”

Do not be deliberately obtuse.

If you cannot afford the basics, producing a small village of children is not a mystery of circumstance; it is a failure of judgment.

I think I'd be in favour of a 10% on the estate and then 10% to be paid by the inheritors once probate is finalised. If you take your example, that's £55k paid from the estate for social care and then £49,500 to be paid by your DH as an 'inheritance tax', leaving him/you with £445,500. That's a very nice windfall.

There is no IHT on any amount between married couples so how could they suddenly charge a bereaved spouse a 10% tax on jointly owned assets?

Yeah that would really work, a Spouse having to sell the family home to drum up £20/50/100k in tax.

If he puts it on landlords then they will just put the rents up or sell up.

I would have some NI contributions payable by pensioners. Perhaps a reduced rate starting at twice the state pension level.

I would have a minimum percentage of corporate taxes for companies above a certain annual turnover and a minimum amount of inheritance tax. Even a few per cent would add up.

Will still be winners and losers. Not everyone will need a care home. I do think something needs to give, but it’s finding a fair balance and that won’t be easy to do.

It would be a charge on the house, reclaimed when the second person in the couple died.

Quite straightforward.

They need to bring social care back into government/local government control. About 29p for every £1 spent goes as profit to an increasingly small number of private companies.

But the actual 'profit'/extraction is actually much higher than this because of the way they companies have set themselves up and operate. Separating out operations and property - using property arms to buy the properties (such as care homes etc) with mortgages paid for by government money (secured through companies operating as another arm of the same business) - then offloading those properties to oversea investment arms and signing vastly inflated rent back contracts secured at inflation/long term)

In this set up all the risk sits with the local authorities/government as they would have to pick up all the pieces of the operating arms collapse.

Add to this the fact these companies also set up other arms for recruitment and training - again tapping into another government money source, and also specialist equipment, cleaning contracts etc.

Very little of the money actually goes towards paying people for the actual care necessary.

And this same pattern is happening in child social care, special needs education and now early years childcare.

There is a lot of money already in the system - it just isn't flowing to the right people and a lot of it is being funneled off shore

It's just a mess, I honestly have no idea how they would go about trying to unravel it all now.

But if we could get that money back, then we could increase the wages paid in the care sector and make it a job that people want to do and feel proud to do.

For too long we have made these jobs look like something only people who couldn't get another job do, or weren't academic etc etc - when we should be building a society that values those positions greatly and offer training and incentives inline with that.

All social care workers, early years assistants, special needs workers etc etc - especially given that AI is going to shift the working market so much in the coming years - but jobs looking after people will always exist.

My dad’s carers were nice enough, but it is a job that people don’t want to do and once you go into a home you can see why. High turnover of staff , few rewards and long hours.

Over the next 20 years or so, there is going to be trillions of £s passed down from older house owners as they die. The government know this and are looking how they can get their hands on as much of this as possible. Remember, although it is the older generations wealth being taxed, it is actually the next generations down who will be paying it from their inheritance. I think this is a good idea, as long as the money is ringfenced for care. At the moment care is funded through local government, so if the cost is moved to a central fund, it should reduce council tax. A problem I can see, is that many people will prefer to go to privately run home, assuming they will be better than gov run ones. It needs a system that they pay the excess over what a gov run care home would cost, not the full whack and then get stung for the 10% charge on top.

I think DH just accepts that it will all go on care. What is galling is knowing that her money will be subsidising people in the home who are paying nothing or very little.

I wish my PILs had gone out and spent money and enjoyed themselves when they were younger rather than saving so much.

Wil these cross party talks address trust funds as well ? A loophole that exists that can save a lot of money.
There is a lot to unravel isn’t there.

I agree about landlords, but certainly not pension schemes. Gordon Brown already damaged the pension schemes due to his tax changes that caused many to close or fail. You have to remember that pension schemes exist to invest in funds for current and future scheme members, who are usually your "average" Joe Worker.

Tax is paid by landlords and pensions. Clearly the bigger the amount the more tax and higher marginal tax rate it will be. It’s taxed the same as any other income.

There isn’t one it’s just a rant which makes zero sense.

@Sweetpeasaremadeforbees yes, it is currently very unfair. I generally agree with the broad shoulders argument but it's hard to reconcile someone who saved and someone who didn't being subsidised by the saver.

Just scrap NIC and increase income tax instead. Make things a lot simpler and fairer. Set it at a level where the average worker won't be affected.

I couldn’t see a problem with the so-called ‘death tax’ with a reasonable cap on how much an individual contributed before the state picked up the bill. Only tweak I would have made was to use a % of capital /property not a set amount as obviously property values differ widely throughout the country so £86,000 in the north could be most of your house value.

It’s very complex isn’t it. If you start on one group , they can quickly turn ( such as landlords just selling up ) I hope that they try to cover all angles. I don’t envy them.