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Politics

The really rich don't pay inheritance tax

112 replies

ninna · 23/04/2010 11:25

The really rich don't pay inheritance tax. I have heard this many times on the radio. For instance, I remember someone saying that the Queen mother probably wouldn't have paid any.
I gather it's something to do with trust funds but have never heard an explanation of how it's done and why it's allowed.
It has always seemed very unfair to me. The labour party is supposed to be about fairness. I wonder why they haven't done anything about it.
I wonder if anyone can explain what's going on?

OP posts:
ninna · 28/04/2010 10:07

Such alot of intersting discussion.
Life is not fair. I believe that you are either born into a charmed circle or a circle of deprivation. The charmed circle isn't necessary very rich, but provides love, security, functionality[is there such a word] etc. I believe it very difficult to move from the c of d to the c c. It would be so good, and to the benefit of us all, if more taxation was used to help the ones in the c of d and not frittered away!!
You might call me pedantic,but i still don't understand the ins and outs of trust funds. I would really appreciate it if someone could give me an idiot's guide.

l

OP posts:
cleanandclothed · 28/04/2010 12:04

Try here. And then come back and ask again if you have any specific questions - happy to answer if I can

scaryteacher · 28/04/2010 19:44

What makes you think that inherited money is frittered away?

My ds inherited a grand from my late Grandmother. It is sitting in an account and I add to it, so there is money there for uni. How is that 'frittering'?

As to the circle of deprivation - emotional deprivation doesn't just happen in the less well off families - would money be available for those who are dysfunctional but well heeled?

ninna · 28/04/2010 19:51

Cleanandclothed. Many thanks. I shall have a good look on that website.
Scaryteacher. I'm sorry but you obviously didn't understand what i was talking about

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Alouiseg · 28/04/2010 20:01

Clogs to clogs, kimono to kimono, rice paddy to rice paddy, shirtsleeves to shirt sleeves. And it is a proverb that describes human behavior in terms of creating long-term families as failure.

The theory of the proverb is that the first generation starts off in a rice paddy, meaning two people with an affinity for one another come together and create a financial fortune. They usually do it without making significant changes to their values, customs or lifestyle.

The second generation moves to the city, puts on beautiful clothes, joins the opera board, runs big organizations, and the fortune plateaus.

The third generation, with no experience of work, consumes the financial fortune, and the fourth generation goes back in the rice paddy. This is the classic formulation of the shirtsleeves proverb, which is as true today as it has been throughout evolved human history.

Doodleydoo · 28/04/2010 22:12

Well I guess if you work on that proverb (very interesting and I think probably quite true for some of the super rich who gamble away their family fortunes - although more of that happened in the 80's, now it seems they become green politicos or some such), as have previously said the super super rich tax them to the hilt, but it won't happen because us middle of the road lot are far easier to tax aren't we!

On a tangent, earlier on in the thread it was posed what would knowing that it was all going taken away and how it would affect your spending behaviour (or that is how I saw it)?

I came to the conclusion today after much mumbling and grumbling from my siblings that my parents weren't helping them out (they aren't helping me out financially either!) with private school fees for 6 kids between them (own choice perhaps and asking my parents to fork out 10k per child per term!!!!!!!) - that perhaps what money my parents have they should spend on themselves, they have spent most of their lives "helping us out" with a good education to further ourselves, lovely family holidays (nothing fancy, cornwall/france but vvv fun), when my df was working he would help us out with further education, helping my ds set up her business.....blah blah blah, and now the siblings are asking what their inheritance is likely to be .

Frankly I say spend it as life is too short and they are in the 70's so perhaps reading this thread has made me realise that there is more to life and yes I can earn my own money.

My major concern with IHT is with regards to my own dd and what would happen if something happens to dh and myself while she is young, would love to have the opp to leave enough money to leave her comfortable and provide her with the life that we would like to provide for her if alive iyswim.

scaryteacher · 28/04/2010 23:01

So explain then Ninna, because you obviously didn't explain clearly enough for this postgrad to understand!

ninna · 29/04/2010 08:27

scaryteacher. Just maybe you're not as clever as you think you are.

OP posts:
scaryteacher · 29/04/2010 09:34

Instead of being rude Ninna, why don't you explain what you mean? There is emotional deprivation in many well off families. Equally, you can be in a 'charmed circle' in a poor family - wealth doesn't come into this one, but the value your parents place on education and keeping the family together; manners, eating together; knowing where your kids are and who their friends are. Love, security and functioning as a family isn't restricted to those with with money - look at the Royal Family; well off but dysfunctional by any standards.

mmrsceptic · 29/04/2010 11:24

scaryteachers orfly bright

it is possible to exit the circle of deprivation through education

unfortunately Labour has been closing the educational exit doors for years

scaryteacher · 29/04/2010 13:41

Especially with the underfunding in rural areas.

Alouiseg · 29/04/2010 15:49

....and initially with closing down Grammar Schools and latterly by charging for higher education.

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