First Aspect
Legendary Member
The people administering paying it often don't have any control over whether or not it it was incurred.
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The people administering paying it often don't have any control over whether or not it it was incurred.
Pblakeney
Legendary Member
In which case what is left over is a surprise bonus.
I was never a fan of "Here's what you could have won!".
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briantrumpet
Timewaster
Seems like a win, at least for now.
Dorset Boy
Well-Known Member
So, say you live within Z3 in London, so your 3 bed terrace is "worth £1.3 million", and then you have a pension and investments.
You are 65-70.
Do explain how you would avoid paying any inheritance tax.
And don't suggest selling up and moving to another part of the country.
Pblakeney
Legendary Member
There are ways and means. Speak to your financial advisor.
midlandsgrimpeur
Senior Member
Isn't that the same charming gentleman that was trying to force the Prince Charles Cinema out its premises? I think he lost that one as well!
First Aspect
Legendary Member
It is hard if it is someone's primary residence and they want to live in it. The only option is to gift it and then pay rent. There are thin arguments about rooms for family guests that are frequently used, that sort of thing. That aside, someone can gift £3k a year. Which firstly doesn't put a dent in a 7 figure property value and secondly isn't available for many low income asset rich people.
The other options I suspect aren't within range of most people financially.
So move home mum and dad, if you love me. That's about it.
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Dorset Boy
Well-Known Member
As you are aware, I am a financial adviser and I want to know why you think it is possible, and why you are calling people who pay IHT stupid.
You cannot just say there are ways and means - that's a nonsense answer to a straight question.
You're clearly THE expert in this field as you state no one needs to be paying IHT.
You can't give the house away without then paying the open market rent on it for ever more.
You need the other financial assets to live off.
So just what do you do to avoid the IHT Mr Expert?
Or are you spouting BS?
midlandsgrimpeur
Senior Member
I have absolutely no issue with inheritance tax. I find the idea that it somehow punishes people to be ridiculous. The fact is that even if you started with nothing and are a so called "self made millionaire/billionaire" you got there off the back of other people's labour as well as your own. Anyone with a high net worth, whether asset based or cash rich will have done so with a fair degree of help from many other people, so the idea that one should pay a chunk of it back for the public good seems only fair to me.
Pblakeney
Legendary Member
Okay. What I did rather than what would I do. Choose not to move to the SE so I don't have to move out again later. Life is so much easier when not lumbered with an overpriced house. "Stupid" is overselling it but I cannot see the attraction when older. Loved city life while young though.
Lifestyle aside, my decision was made on a financial basis, it wasn't worth the hassle. IHT is further validation.
PS - As MG says (and I hinted at earlier) people focus on what they could have had instead of being grateful for what they do get. It's not as if they worked for it, their parents (or whoever) did that. Also, this is not a geographical anti-SE post, it is an anti-overpriced housing post.
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First Aspect
Legendary Member
It is hated because it is taxing things that have already been taxed, and paid by people who have by and large just lost someone they love. Hope that helps.
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briantrumpet
Timewaster
This.
TBH, I was surprised that the threshold was/is pretty high, with the first £1mn tax-free. The fact that my parents' house went from £2000 in 1960 to £450k in 2020 was a a completely an unearned bonus in the estate, and if it had been £2mn, paying tax on the second million wouldn't be the sort of thing I'd be moaning about.
Dorset Boy
Well-Known Member
So you really haven't answered the question. For many in London, moving to a different part of the country isn't a practical option.
Even elsewhere in the country their modest house could be worth £600-£700k, and then they have £500-600k in financial assets that they need to live off.
So how do you suggest they arrange things to avoid their estate being liable for any IHT?
I don't have any issue with Londoners being hit for large amounts of IHT given most of it will be due to the value of their homes increasing which they haven't done anything for, coupled with the favoured status London has had from Government infrastructure spending over the last 30 years. I don't in general have any issue with IHT so long as the thresholds are set at a fair level. I do think the Residence Nil Rate Band is wrong, and it should just be a £500k pp nil rate band covering all assets.
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briantrumpet
Timewaster
See my other post - the increase in the value of a parent's house hasn't "already been taxed" in most cases.
midlandsgrimpeur
Senior Member
No, it's hated because people like to hold on to as much wealth as they possibly can and usually resent govts "taking my money".
I run a business, I hand over thousands upon thousands of pounds in tax every year, my father handed over a small fortune personally when he was alive and in death. I have no issue with that, I am in no way wealthy but I am fortunate where others are not. As a result it is only fair that I have to pay up, as any wealth I create is not done in isolation.
