Inheritance Tax

[icowden]

et's face it you're talking boll0x and you know it, the chances of both you and the missus dying in an accident at the same time is highly unlikely and you know it.

Well of course.

There's people on here that can't even get a job and live in social housing and on benefits and you're feeling hard done to because you live in a half million pound house and someday, someone might have to pay some duty on a pile of free money!

Nope. You have missed the point. I think that inheritance tax is fundamentally unfair because in penalises people based on where they live and not based on the monetary value of their estate. A 3 bedroom house is worth vastly different sums of money depending on where it is located.

I'd rather be raising tax in better ways anyway.

 

[newfhouse]

in penalises people based on where they live and not based on the monetary value of their estate.

No, it is based entirely on the monetary value. There's a threshold and then a flat rate of tax.

A 3 bedroom house is worth vastly different sums of money depending on where it is located.

If I own a house that doubles in value over ten years then any increase in the number of pounds it is worth depends on the starting point. Say house A is worth £200k and rises to £400k; I have gained £200k. House B inflates from £400k to £800k in the same period; I have gained twice as much even though the percentages are the same. Why shouldn't that difference in wealth be recognised by the tax system?

 

[Ian H]

Actually, I'm all for it.

I was thinking the same. Shep turning positively socialist (I'm assuming it's temporary).

 

[Deleted member 28]

I was thinking the same. Shep turning positively socialist (I'm assuming it's temporary).

Well, my kids will be in the same boat at some stage (although my house isn't worth half a Mil) but the same applies to them.

 

[spen666]

Nope. You have missed the point. I think that inheritance tax is fundamentally unfair because in penalises people based on where they live and not based on the monetary value of their estate. A 3 bedroom house is worth vastly different sums of money depending on where it is located.

I'd rather be raising tax in better ways anyway.

Inheritance tax is entirely based on the monetary value of their estate.


Inheritance tax is at the same rate whether you live in Chelsea or Carlisle. There is no geographic difference in the rate of inheritance tax anywhere in England & Wales

 

[Ian H]

Inheritance tax is entirely based on the monetary value of their estate.


Inheritance tax is at the same rate whether you live in Chelsea or Carlisle. There is no geographic difference in the rate of inheritance tax anywhere in England & Wales

If there was it would merely exacerbate house-price differences.

 

[winjim]

High cost area supplement's worth 18% on top of my salary. Would possibly even push me into higher rate tax bracket. Is that fair? Maybe Londoners should get a higher personal allowance. Or lower. I don't know, which way are we moving with this again?

 

[BoldonLad]

If there was it would merely exacerbate house-price differences.

I am not convinced that IHT is a major consideration, when choose where to live?, so, I don't follow why it would impact house prices?

That is not to say that I think such a differential is a good idea.

Whatever next, Regional Rates of Income Tax, Regional Income Tax Allowances, as alluded to elsewhere by @winjim.

IMHO, one of the objectives should be that the tax system needs to be simplified, where possible, not made more complex.

 

[icowden]

Inheritance tax is entirely based on the monetary value of their estate.

No it isn't. That value is established by looking at the current expected sale price of the house if the estate contains one. That house could have vastly different worth just because it is in one area and not another. That's the unfair aspect IMHO.

 

[BoldonLad]

No it isn't. That value is established by looking at the current expected sale price of the house if the estate contains one. That house could have vastly different worth just because it is in one area and not another. That's the unfair aspect IMHO.

That is the nature of house prices, Location, Location, Location as Phil and Kirsty say.

The same house, in a different street may well have a different "value".

Are we going to have IHT based on post codes, or street names?

I suppose we could take the main residence out of the equation, and say it is IHT free?, would that meet with your approval?

 

[newfhouse]

No it isn't. That value is established by looking at the current expected sale price of the house if the estate contains one. That house could have vastly different worth just because it is in one area and not another. That's the unfair aspect IMHO.

I admire your dogged determination to argue your corner but you're still wrong.

 

[spen666]

No it isn't. That value is established by looking at the current expected sale price of the house if the estate contains one. That house could have vastly different worth just because it is in one area and not another. That's the unfair aspect IMHO.

That is exactly what I said, it's the monetary value of the estate.

Something has a monetary value even if it not in cash now.

 

[icowden]

That is exactly what I said, it's the monetary value of the estate.

But the house makes a mockery of that valuation. Mr and Mrs Bloggs can keep their 7 bedroom house and 35 acres in cheapsville but Mr and Mrs Smith who need to live in expensiveville nearer London can't.

 

[Deleted member 121]

Theres a lot that's unfair. But there are many factors to different house valuations and worth. Access to services, infrastructure, jobs, availability of properties as well as others have an affect on property and its value. Jobs tend to have higher pay in the SE. Even the benefit cap is around 15% higher of you live within the M25. Some might argue that is unfair, since London has far better access to public transport and jobs than most other places. The point being fairness is not a reasonable point to argue as the only factor that seems to matter is largely out of your control and that is where you were born and where you were brought up.

 

[BoldonLad]

But the house makes a mockery of that valuation. Mr and Mrs Bloggs can keep their 7 bedroom house and 35 acres in cheapsville but Mr and Mrs Smith who need to live in expensiveville nearer London can't.

Choose not need.

I cannot speak for EVERY "cheap" housing area in the UK, but, certainly in the area I live houses such as you describe are surprisingly expensive, compared to the "common" herd. I suspect this is down to supply and demand, ie, there are not many such houses in "cheapsville".