AIBU to think a 10% inheritance levy for social care is fairer?

[TourdeCrema]

So Andy Burnham is looking at a 10% death tax across the board instead of the system we now have, where social care may wipe out your entire inheritance and you don’t get a penny.

paying for everyone’s social care through the death tax

so if you leave £350k house and your parent had 5 years of care, you sell the house and pay £35k to the government and keep the remaining £315k.
presently you’d walk away with £0 as the social care would take the house cost

i think this is a much more reasonable suggestion, than walking away without a penny if my parent needed care( both my parents are dead, so it won’t affect me now)

Inheritance isn't earned.

Money you have earned absolutely should belong to you - to be used for things you need in your lifetime. That includes care when you are elderly. Circumstances that warrant that assumption being rebutted are, very reasonably, your death. If you die with money or assets then they can be inherited but if you've spent it you've spent it I'm afraid.

If people need something they should pay for it if they can. Not expect others to contribute to it so that only specific people can receive a large sum of unearned wealth.

No it’s not fair

its not fair that if you work and save yiu get hit
higher rate tax
loss of allowance
iht
cgt
reduction in allowance on pensions
pensions now being taxed ( twice)

dont save? Live on benefits? Get it free

A flat rate of 10% won’t raise enough money If it Replaces the current inheritance tax system.

I think a sliding scale similar to Stamp duty is much fairer so those with estates under half a million don’t pay anything, £0.5-1m pay 10% £1-2m pay 15% £ 2m + 20% (or on a continuing scale until it brings in sufficient funding.

I say this is someone due to inherit a large estate. Honestly, inheriting £2m for example as opposed to £3m is not to be sniffed at and a seriously generous gift from my parents when they could (& may still do - you never know!) give it all to their favourite charity and leave an amazing legacy.

Except we as a society rely on parents not only spending their money on themselves for things they need in their lifetime but also to fund the costs associated with raising their children. It costs £200k to raise a child in the UK and frankly anyone taking the financial hit of investing in their child is doing everyone else a huge favour as we need future workers and it's obviously financially advantageous to not have children. It is natural and normal that this parental bond extends to parents wanting to give money to their children in life and death. Both are currently liable to attract a huge IHT bill at the moment depending on timing. If you can spend crazy amounts of money on yachts and expensive holidays then why can't you give it to your children in a similar way? Why does this automatically attract a 40% tax?

I think you're trying to have it all ways. You can't on the one hand state that people should pay for their own care and then on the other hand look to socialise it so that the rich fund the poor. Do you think the poor should be denied care that they can't afford?

My MIL care costs £6k a month. It’s not terribly fancy. She’s been there for 2 years. She hates it, but is frail and lacks capacity. It’s all very sad, but she’s lucky she had a property that funds this. One she inherited (ironically).

36 years of nursing has made me think that prioritising difficult conversations about prolonging frail, demented poor quality of life at all costs would be a much better start.

free nursing care, NHS, schools are a socialist idea - not sure why you are suggesting its to keep money in some families and not others

A flat rate of 10% won’t raise enough money If it Replaces the current inheritance tax system

why do you think that 10% of 100 billion will not be enough money annually?

But as I said earlier, you could use all your money on a care home (for accommodation, food, laundry etc) because only the "care" part is provided and then lose 10% after death, so there'll be even less left to heirs.

Inheritance is very different to the costs involved raising a child. The majority of those expecting inheritance are full adults who no longer need raising.

You can 'want' to give money to your kids but unfortunately it's not a right. If you have stuff you need to pay for then... well you pay for it.

I think they do anyway . They’d might not bother for ten percent though

I would be interested in understanding where that figure comes from as I received nothing from my deceased parents. Neither did my brother. My partner has received nil, and so has his brother.

Your examples are not comparable. They were not constructed expressly to protect money for inheritance.

It would be interesting to know how Sweden or Norway fund elderly care?

What makes it unfair is that a single parent who’s struggled to bring up children and buy a modest house will loose everything outright if they need care. So those kids that grew up at an arguable disadvantage with only parent are disadvantaged again. If one person in a couple needs care the other stays in the house and it won’t be used to pay fees. If you’re over 60 and live with a parent who goes into care the house isn’t sold. The system if full of injustices and it needs looking at.

It isn’t fair. The state chooses to spend money on illegal immigrants, benefit fraudsters and nonsense leaving nothing for people who work hard and pay their taxes. Before someone quotes me please bear in mind that I have worked in the public sector for the last 30 years. This country is run poorly by people who are not seeing what the majority of people are seeing on a daily basis.

People who can will just give their kids money early on ( to aim for 7 years before death) it’s human nature to want to secure your offspring’s future as much as you can. Some people do it through private education is that not their right to do that either?

Exactly how did ‘Boomers’ unfairly annex wealth? Pension ages have risen, final salary pensions ended apart from the public sector affecting those born towards the end of the Baby Boom period. House prices have risen because too few have been built for decades. I would prefer house prices hadn’t risen by so much because my DC are struggling to afford to buy or rent. Government policy over the last 4 decades has caused a lot of these problems (m
ost of the last 45 years the Tories were in power). Eg selling off social housing.

So you think that 10% death tax is being constructed to expressively to protect money for inheritance?

An examination of where the money the NHS receives goes should precede anything. Are all those jobs on the non-direct medical side really necessary? I would like to see a breakdown of the % spent on direct patient care against the % spent on non-direct care.

even if the single parent doesn't need care and buys a modest house - any the time they die the children will pay 40% on part of the estate due to house prices. Whereas a couple married will double the protected part of the IHT £325 x 2 + £150k instead of £325 +£150k

over 90% is spent on direct care
2% spent on admin and indirect care

Not with inhertance tax. It has been abolished.

Sweden have municipal care homes - 290 of them for 2.2 million people over 65

UK has 220 municipal care homes with 12.5 million over 65s

How much direct care is by for profit companies?

People are told they can't leave more to their children because:
a. Their assets should fund their care
and
b. Even if that care isn't needed, it's supposedly unfair on those who will inherit nothing.

Yet a large proportion of that money paid for care ultimately ends up being paid to profit-maximising, for-profit care companies. Some are backed by private equity, that has complex tax structures, and pays salaries that require government top ups, whilst profits flow out of the country thought complex tax structures.

Seems fair...