Inheritance Tax

[matticus]

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.

It's almost like expensive houses tend to be in more desirable areas. Has anyone else noticed this correlation??

 

[BoldonLad]

Leaving aside the question of if we should tax inheritance at all,

Would it be more fair if IHT worked more like Income tax, ie, each benificiary get a personal allowance, with no tax deducted, the balance is taxed on a sliding scale, starting at (say) 10% and increasing in bands to whatever the top rate of income tax.

This would tax the biggest earners and/or largest estates more than more modest earners and estates.

Seems fair?

 

[newfhouse]

This would tax the biggest earners and/or largest estates more than more modest earners and estates.

Seems fair?

Modest estates are not taxed at all.

 

[winjim]

Leaving aside the question of if we should tax inheritance at all,

Would it be more fair if IHT worked more like Income tax, ie, each benificiary get a personal allowance, with no tax deducted, the balance is taxed on a sliding scale, starting at (say) 10% and increasing in bands to whatever the top rate of income tax.

This would tax the biggest earners and/or largest estates more than more modest earners and estates.

Seems fair?

That does act contrary to the two child benefits policy.

 

[All uphill]

Leaving aside the question of if we should tax inheritance at all,

Would it be more fair if IHT worked more like Income tax, ie, each benificiary get a personal allowance, with no tax deducted, the balance is taxed on a sliding scale, starting at (say) 10% and increasing in bands to whatever the top rate of income tax.

This would tax the biggest earners and/or largest estates more than more modest earners and estates.

Seems fair?

So move the focus from the financial circumstances of the deceased to the financial circumstances of the beneficiaries?

That makes some sense to me as it could be more redistributive- poorer legatees could receive more than wealthy ones.

 

[BoldonLad]

So move the focus from the financial circumstances of the deceased to the financial circumstances of the beneficiaries?

That makes some sense to me as it could be more redistributive- poorer legatees could receive more than wealthy ones.

Indeed. My thinking exactly, which, I thought was the objective of some of the other contributors on here, but, it would appear not.

 

[BoldonLad]

That does act contrary to the two child benefits policy.

Perhaps.

But, I wasn't aware we were discussing the two child benefits policy?, I thought, it would appear mistakenly, that we were discussing making the IHT Tax system and re-distribution of wealth more fair?

 

[BoldonLad]

Modest estates are not taxed at all.

Depends on your definition of "modest".

But, whatever your definition, the allowances and percentage rates of tax could be adjusted to achieve that result, I would have thought.

I thought, it would appear mistakenly, that we were discussing making the IHT Tax system and re-distribution of wealth more fair?

 

[newfhouse]

Depends on your definition of "modest".

If left to children or grandchildren it’s half a million. That’s an immodest legacy in my eyes.

I thought, it would appear mistakenly, that we were discussing making the IHT Tax system and re-distribution of wealth more fair?

I’d reduce the threshold and taper the tax.

 

[icowden]

Modest estates are not taxed at all.

Yes they are, if that modest estate happens to be in Fulham or Tooting or Streatham, or Wimbledon etc.
You keep on insisting that if a person can buy a two bedroom semi and afford a loft conversion and an extension that by default they are stinking rich. There are no millionaires in my close as far as I am aware, but the vast majority of these 3 bed houses are worth a lot of money because of where they are, and over the 500k threshold. Yes, if you are married and have exactly the right circumstances then you can increase that to a million.

My house started life as a 3 bed detached house. The previous owners added an extension above the garage making it 4 bed. We converted the useless garage giving an extra reception room. My neighbours have a 2 bed end of terrace semi. They are doing a loft conversion and ground floor extension. This is one reason why the next generation find it so hard to get onto the property ladder. Many people buy a house they can just about afford, then instead of moving, make it bigger.

If you moved my street to Wolverhampton IHT wouldn't be an issue for anyone.

As it is, IHT only applies to a narrow band of people. If you are wealthy enough you just avoid it because you can afford an accountant who will find myriad loopholes to ensure that no IHT gets paid on your estate. Do you think the Barclays, Lord Rothermere, RIshi Sunak, JRM etc will be concerned about IHT? Of course not. SO if you are only taxing those that have more money due to property or a bit more cash than most but not enough to dodge it, what's the point of it?

 

[Deleted member 28]

If you moved my street to Wolverhampton IHT wouldn't be an issue for anyone.

Plenty of expensive houses in Wolverhampton son, look at Whitwick, Tettenhall, Perton Ridge and lower Penn, all within a mile of where I live.

The fact remains your kids aren't going to live in the 'family home' when they grow up, it's not Downton Abbey Ffs, so get a grip and be grateful you can afford to live in such a 'desirable' area and send them to a private school, hopefully by the time you snuff it they'll be flying high in society and the bit you leave them will go straight in the bank.

 

[winjim]

Perhaps.

But, I wasn't aware we were discussing the two child benefits policy?, I thought, it would appear mistakenly, that we were discussing making the IHT Tax system and re-distribution of wealth more fair?

The benefits system is one way we use to distribute wealth. But penalising poor people for having children while rewarding rich people for doing the same doesn't seem very redistributive.

 

[BoldonLad]

If left to children or grandchildren it’s half a million. That’s an immodest legacy in my eyes.

I’d reduce the threshold and taper the tax.

Isn't that what I was suggesting?, except, I was also suggesting taking the Financial Status of the beneficiary into account.

 

[BoldonLad]

The benefits system is one way we use to distribute wealth. But penalising poor people for having children while rewarding rich people for doing the same doesn't seem very redistributive.

You have lost me there, I wasn't aware I was suggesting that?

I was suggesting that the Financial Staus of the beneficiary was part of the consideration for how much IHT was paid.

 

[All uphill]

Indeed. My thinking exactly, which, I thought was the objective of some of the other contributors on here, but, it would appear not.

Then we could just class inheritances as taxable income.

Oldies, like me, would be able to leave 100% of our estates to our kids. Kids would just pay tax.

We are geniuses @BoldonLad