If Labour raises taxes what will you think?

[functioningagain]

Typing on my phone so not sure I can do a poll? But, if the government raises income tax or NI at the budget, will you think:

A - let’s get real, they had no other choice
B - those duplicitous / inept bastards

Yes not sure how the pp put A next to that, sums up Labour

@RoostingHens

My father has been in a care home for 6 years. He is often the only male resident.

Total care home costs to date exceed £100K. All paid by his state and NHS pension.

Since he went into care, I have advised my mother to fully utilise the £3K per person annual HMRC allowance for gifts. This ensures her savings are always below the care home limits. So, if she went into care, she would not have to pay.

Her property was put into trust for the grandchildren almost 20 years ago. Hopefully that is long enough to stave off any claims the local council may make in the future.

However, her solicitor advised that the council will attempt to take her property as they might get lucky. Court and legal fees incurred by the council would be taken from council tax revenues.

@RoostingHens

My father has been in a care home for 6 years at cost of over £100K paid by his state and NHS pension.

Since he went into care, my mother has made full use of the £3K per person per year HMRC allowance for gifts. It ensures her savings are below the threshold for payment of care home fees.

Court and legal fees incurred by the council would be taken from council tax revenues

No, if they won their case, they’d (rightly) be paid by your mother.

Why are people here thinking there aren’t inheritance taxes? It’s 40% and one of the drivers of people leaving for better tax regimes.

People used to live closer to their families because there were better work options everywhere. Nowadays, kids go to uni and never return to work in their home towns because there are few decent jobs outside the major cities unless you're a medic or teacher or happen by chance to live in a place with a big employer nearby, and even then, it's not much help if your kid is an actuary and the nearest insurance firm is a couple of hundred miles away from your home town. I don't think people realise that family fragmentation is often due to the massive decline in choice/options of professional employments out in the regions. The "brain drain" is very real.

That just shows how many people’s stay in a nursing home must be well below 18 months in order to bring the average down.

Her property was put into trust for the grandchildren almost 20 years ago. Hopefully that is long enough to stave off any claims the local council may make in the future.

If she has continued to live in her property without paying a market rent then not only will the council be interested, so will the tax man for inheritance tax.

Who should pay for her care if she goes into a care home?

The nil rate inheritance tax band is up to 1 million on main property (2 x 325k plus 175k property to direct descendants ).
40% only kicks in after that.
As it is generation housing bonanza wealth, that is 1 million x millions of people that is untaxed entirely. I was not saying that 40% is reasonable. I think it should be a low rate like 10% on everything pretty much. That would also avoid people structuring around it. May actually raise some serious money as well.
As people keep going on about wealth taxes, a death tax is surely the best as easy to administer and we all die and who actually is so greedy they care more about what they pay when dead, rather than still alive.

“Gifts with reservation
If the person who died gave a gift and used it in the 7 years before they died, it is seen as a ‘gift with reservation of benefit’. It is not an outright gift and is not exempt.
As an example, someone could transfer ownership of their house to a relative and continue to live in it without paying rent at the going rate.
If they continued to use the gift in the 7 years before they died, it counts as part of their estate. It does not matter when they gave it. It is taxed at the market value at the time of their death as if they still owned it.
If they paid rent at the market rate when they gave away their property, they would not have retained a benefit…
Tax on the gift with reservation is usually paid by the recipient of the gift. If tax is outstanding 12 months after the person died, their personal representative may have to pay it.“

www.gov.uk/guidance/work-out-inheritance-tax-due-on-gifts#gifts-with-reservation

Agree - one of many cliff edges we have in our tax code that lead to really counterproductive behaviour for individuals AND the state.

We all die so the decision we make is how much to spend before we die. As we don’t know when we will die some may spend it all and rely on the state to pay care home fees. Others may be more cautious and keep it in case we need it in old age. The question for the state is how much to encourage us to spend (boost economy) and how much to save (and pay for our own care). Of course, election cycles matter too if they boost the economy now versus saving on care after the next election or two.

Well, I heard on the news today that they’re adding mortgage and financial info like this to the curriculum which is great. Wish I was taught this in school and saved/invested better and from a younger age.

I agree with including finance in the national curriculum - although too much about mortgages and pensions would probably send the kids to sleep.

However, as the curriculum is already too full, something will have to go.

The Agricultural and Industrial Revolutions didn't happen then?

Fair point though, we are miles away from ours and our son is presently in SA and dd likely to relocate to Europe for her partner's work. But, we have made provision for ourselves and for our mothers.

Where is all of this cheap undeveloped land with amenities and access to services, hospitals etc and decent public transport? What about the endless supply of cheap building materials? Shall we build houses for our wider support network too? I'll wait.

Problematic cultural attitudes are not exclusive to the British. Your hardworking immigrants vs brainwashed, sponging Brits is just as offensive as anything Farage or Stephen Yaxley-Lennon could come up with. There are freeloaders in every society around the world.

@RoostingHens

If she has continued to live in her property without paying a market rent then not only will the council be interested, so will the tax man for inheritance tax.

Gifts made 7 years before death are not subject to IHT. Also, IHT does not kick in unless the inheritance exceeds £325K

Market rent does not apply. I know this because my mother’s neighbour had not paid rent at all in the 20 years+ she lived in her house after the trust was set up before her death.

@NorthXNorthWest

Who should pay for her care if she goes into a care home?

The state. Just like they did for her BIL who was on benefits for 40 years before he event into a care home.

@Blossomtoes

No, if they won their case, they’d (rightly) be paid by your mother.

They would not win. The council who took her neighbour through the courts lost on the basis that the trust was set up when she was in good health.

The judges ruled that the health issues she developed 20+ years after the trust was established could not have been foreseen at the time the trust was set up.

Can I ask why your BIL was on benefits for 40 years?

I bet they would win now. The motive of anyone who sets up this arrangement is crystal clear, regardless of their state of health when it was set up. It’s fucking outrageous to expect the taxpayer to pay for your care because you don’t fancy dipping into your own pocket.

Giving your house away sounds like a plan until….

My aunt made over her house to her ds and dil. Except that the dil has now gone off with another bloke and wants half the assets, which includes aunt’s (her mil’s) house!

@NorthXNorthWest

Can I ask why your BIL was on benefits for 40 years?

He was my mother’s BIL. Ie my uncle. He used to work in a factory when wages were good. However, at age 38 he opted out of working.

He went into care age 77. Was there for maybe three years maximum. All paid by the state (taxpayers).

My father has entered his 7th year in care. All paid for by himself.

@Blossomtoes

The motive of anyone who sets up this arrangement is crystal clear, regardless of their state of health when it was set up.

Tell that to the judges. Nobody can know 20+ years in advance how their life will work out.

It’s fucking outrageous to expect the taxpayer to pay for your care because you don’t fancy dipping into your own pocket.

And yet the taxpayers have to cover the cost of illegal immigrants and their free hotels?

@MaturingCheeseball

Inherited assets do not automatically qualify as marital assets. For example, if they were inherited before the marriage took place and were never used for the family’s needs, they would be excluded.

However, if the assets were inherited after the marriage and were used for the family’s needs such as a deposit on a home, then they would likely be considered as marital assets.