Inheritance Tax

[drfchound]

I’m sure I heard it suggested on the morning news that Hunt is contemplating abolishing IHT altogether next year.

[Bristol Red Rover]

But BST that is the problem! Why should people be put in such a situation that they have to gamble and hope that their health holds out until they go? Why should it be such a black and white tax which collects very little in terms of the tax take, causes so much anger and does nothing to create the social injustice that you hope it solves? As the country with just about the highest IHT take amongst western democracies and yet we have a country that is constantly overtaxed and none of its social inequalities are dealt with.

Surely letting people like me keep my money, look after myself and my wife into our later years and not have to worry about making ends meet just to avoid a tax which is inherently unfair? That's what a modern and responsible society should be doing. And as pension pots are now being mandatory throughout the workforce more and more people will be faced with this situation as the government rolls back on its duty to take care of its citizens. Were being run by governments without a social conscience.

It's a choice. If someone doesn't trust that their kids will help them out with thepre death inheritance they'd be gifted, then don't do it. It's safer to not do that and let them pay the tax on that anount over half million £s.

IHT does collect taxes that affects services and/or other taxation levels. Just because it isn't the biggest tax doesn't mean it makes it unimportant.

The anger appears to be in certain people that think they're being robbed? They're not, as explained above. That anger would be best directed at solving their problem or emotional issues, or accepting that £800,000 out of £1,000,000 isn't much of a price to pay and the benefits that can bring to there being a better society - less crime, more choice, better protection to the elderly, social stability ETC - is also a benefit to the recipients of that £800,000. A win win for them.

Your stats over taxation are questionable at best. Levels of IHT in other countries (albeit in 2015/2019) - France, Japan, Belgium, Germany, S Korea are all higher, the US and Netherlands are the same. Yes, many are lower, many are 0% but then they will mainly be taxed in other ways.

Your choice about you worrying is a choice. The tax you think is unfair is thought by most to be fair. Not sure where your comments in the last para are going. Seems it slips from your worry if you make a choice to give away money to avoid a tax, then towards pension issues and how that is making others compelled to worry (it clearly is not - logic), and then towards governments not having a social conscience if they use taxation of wealth to make a better society? You might want to clarify some of that.

And quit being a potty mouth, it doesn't look grown up.

[big fat yorkshire pudding]

It's all comparative pud

I have zero idea what you mean. What do you think about the tax?

I mean wealth is comparative, relative to what you have and to where you are likely to end up on the ladder You could also look at how poor football clubs manage compared to the premier league, look at IH as helping in a small way to assisting the clubs in the lower leagues.

if you need another example look no further than this recent article below and compare the plight of people described in it to your own.

IT helps level the playing field, assists in social mobility. I support anything that does that.

............. ''Physical and mental wellbeing, community building, life skills; the mothers and babies programme hits a lot of notes. That’s in part because it has to. Doncaster is one of the most impoverished places in England, where a third of children are living in poverty and 41% of residents fall into the bottom 20% of incomes nationwide. Women in Doncaster have the third-worst healthy life expectancy in the country, with an average of 24 years spent living with ill health (for men this figure is 21 years)'' .................

https://www.theguardian.com/football/2023/nov/11/babies-battle-ropes-and-billy-joel-how-doncaster-rovers-reach-out

Bump

what do you think of the tax, pud?

I think it's ridiculous if I'm honest, for the points I've made and others have.  There's better ways to raise the money than taxing death, I gave one simple option in the thread.

I've spent years grumbling about the unfairness of tax since the age of about 14, I doubt I'll change that view.  My biggest grumble overall is the view that government is the best method to distribute tax money, welfare etc. It isn't.

[BillyStubbsTears]

BFYP.

To misquote Churchill, I'd say that Government is the worst way to run welfare, tax etc.

Apart from all the other ways you might want to try.

PS

IHT doesn't tax death. It taxes bequeathed wealth.

[BillyStubbsTears]

'A lot of these numbers... are sort of made up' - Paul Johnson, IFS, in his review of the Autumn Statement.

https://twitter.com/SophyRidgeSky/status/1727353906341282050

It's certainly starting to look that way as people start to drill down into the details that Hunt didn't mention.

The numbers stack up on the assumption that:

1) All Govt spending apart from health, defence and education is set to fall by 4.1% each and every year for the next 5 years.

2) The best part of half a million severely incapacitated people will be moved off that level of welfare.

Aye. Good luck with that.

A cynic might call this a scorched earth policy, leaving those who take over next year with the unpopular job of taking the really hard decisions.

[drfchound]

'A lot of these numbers... are sort of made up' - Paul Johnson, IFS, in his review of the Autumn Statement.

https://twitter.com/SophyRidgeSky/status/1727353906341282050

It's certainly starting to look that way as people start to drill down into the details that Hunt didn't mention.

The numbers stack up on the assumption that:

1) All Govt spending apart from health, defence and education is set to fall by 4.1% each and every year for the next 5 years.

2) The best part of half a million severely incapacitated people will be moved off that level of welfare.

Aye. Good luck with that.

A cynic might call this a scorched earth policy, leaving those who take over next year with the unpopular job of taking the really hard decisions.

Excuses already?

[SydneyRover]

tory governments have the answers:

.......... ''But to achieve this, No 10 needs to answer another question: what’s the strategy? On NI in two years alone the Tories have gone through four iterations: increase it for the NHS, cut it under Liz Truss, oppose a cut under Rishi Sunak, then a bigger cut than expected with this latest statement. Big state, small state, five promises, long-term decisions, change, conservatism, another five promises: the government needs to settle on what its message is, fast'' ..........

https://www.theguardian.com/commentisfree/2023/nov/22/will-jeremy-hunt-autumn-statement-revive-the-tories-election-chances-our-panel-responds

I used to be indecisive, but now I'm not so sure


vote tory

[MachoMadness]

Streets saying the Tories are looking at a spring election. Had to get one last kick in at the disabled for old times sake, it seems.

[SydneyRover]

I guess that anyone that bought a house in the 1970s rather than the 50s or 60s was very lucky indeed, unless of course you were able to predict the market.

''Average UK house prices hit a record high in June, making today’s average house price 65 times more expensive than in 1970''

In 1950, the average cost of a new house was around £65,224 in today’s money
In 1960, the average cost of a home was approximately £55,784
At the start of the 1970s the average house price was £4,057
In 1980, the average house price shot up to £20,268
In 1990, it rose again to £58,153
In 2000, the average cost of a home reached £89,597
In 2010, this almost doubled to £170,365
In 2020, the average property in the UK valued at £249,633
And now in June 2022, house prices have reached a record high of £271,613

https://www.openaccessgovernment.org/uk-house-prices-are-65-times-higher-today-than-in-1970/138813/

This of course doesn't take into consideration where wages were over that period.

[tommy toes]

Hunt saying he's determined to get the 100,000 long term claimants of benefits with enduring mental health issues down to 30,000.

My son will fall into that bracket and has never, nor will he ever, be capable of holding down a job and there are at least 100,000 with his illness in the same boat.

So good luck with that Jeremy.

[BillyStubbsTears]

Hunt saying he's determined to get the 100,000 long term claimants of benefits with enduring mental health issues down to 30,000.

My son will fall into that bracket and has never, nor will he ever, be capable of holding down a job and there are at least 100,000 with his illness in the same boat.

So good luck with that Jeremy.

I can only assume that he has never lived with anyone with a mental health illness.

Actually, I'm more cynical than that. He KNOWS this is not possible. He's chucking red meat to those parts of the Tory party who think these people are workshy skivers, knowing damn well that they'll be out of power in 12 months and someone else will have to clean up this shit.

[SydneyRover]

Most people with disabilities want a normal life, to be treated as equals and given equal opportunities, those with more serious disabilities would surely want the same I would think, if it was at all possible. And of course if there were jobs available.

[Dutch Uncle]

I guess that anyone that bought a house in the 1970s rather than the 50s or 60s was very lucky indeed, unless of course you were able to predict the market.

''Average UK house prices hit a record high in June, making today’s average house price 65 times more expensive than in 1970''

In 1950, the average cost of a new house was around £65,224 in today’s money
In 1960, the average cost of a home was approximately £55,784
At the start of the 1970s the average house price was £4,057
In 1980, the average house price shot up to £20,268
In 1990, it rose again to £58,153
In 2000, the average cost of a home reached £89,597
In 2010, this almost doubled to £170,365
In 2020, the average property in the UK valued at £249,633
And now in June 2022, house prices have reached a record high of £271,613

https://www.openaccessgovernment.org/uk-house-prices-are-65-times-higher-today-than-in-1970/138813/

This of course doesn't take into consideration where wages were over that period.

Is the 1970's figure correct Sydney? Are you sure it is 4,000 rather then 40,000? Your point about the 1970's would still be valid.  If it is 4K, what happened? A lot of building houses?

I was out of the country living in Germany and the Netherlands, but out of interest there was a large housing price crash at the beginning of the 1980's in the Netherlands. But it was a different market - most buyers in NL bought a house for life rather than gradually climbing up the housing ladder.

[big fat yorkshire pudding]

Hunt saying he's determined to get the 100,000 long term claimants of benefits with enduring mental health issues down to 30,000.

My son will fall into that bracket and has never, nor will he ever, be capable of holding down a job and there are at least 100,000 with his illness in the same boat.

So good luck with that Jeremy.

I can only assume that he has never lived with anyone with a mental health illness.

Actually, I'm more cynical than that. He KNOWS this is not possible. He's chucking red meat to those parts of the Tory party who think these people are workshy skivers, knowing damn well that they'll be out of power in 12 months and someone else will have to clean up this shit.

Some other interesting quotes;


We won’t get our economy motoring and raise living standards unless we tackle the huge rise in economic inactivity – the number of people out of work and not looking for work. This is urgent. We have seen half a million more people fall into inactivity since the start of the pandemic. It is an increase that is larger and more sustained than in any other G7 economy.

The number who cite long-term sickness as the reason for being out of the workforce has reached its highest ever level: over 2.5 million people. That amounts to 400,000 more than before the pandemic.

A smaller workforce means lower incomes, lower economic output, and weaker public finances. But it is also devastating for individuals’ lives. What a waste of opportunity when someone wants to work but is left without the support to do so. This is the case for 600,000 people who are long-term sick but want a job.

1.3 million of those out of the workforce due to long-term sickness have a mental health condition. And that number has climbed in recent years too, up by 200,000 since 2018.

[drfchound]

I guess that anyone that bought a house in the 1970s rather than the 50s or 60s was very lucky indeed, unless of course you were able to predict the market.

''Average UK house prices hit a record high in June, making today’s average house price 65 times more expensive than in 1970''

In 1950, the average cost of a new house was around £65,224 in today’s money
In 1960, the average cost of a home was approximately £55,784
At the start of the 1970s the average house price was £4,057
In 1980, the average house price shot up to £20,268
In 1990, it rose again to £58,153
In 2000, the average cost of a home reached £89,597
In 2010, this almost doubled to £170,365
In 2020, the average property in the UK valued at £249,633
And now in June 2022, house prices have reached a record high of £271,613

https://www.openaccessgovernment.org/uk-house-prices-are-65-times-higher-today-than-in-1970/138813/

This of course doesn't take into consideration where wages were over that period.

Is the 1970's figure correct Sydney? Are you sure it is 4,000 rather then 40,000? Your point about the 1970's would still be valid.  If it is 4K, what happened? A lot of building houses?

I was out of the country living in Germany and the Netherlands, but out of interest there was a large housing price crash at the beginning of the 1980's in the Netherlands. But it was a different market - most buyers in NL bought a house for life rather than gradually climbing up the housing ladder.

Syds post jumps around the figures a bit Dutch.
The figures he gives for the 50s and 60s are related to todays money but none of the others are, despite the 70s being fifty years ago so it doesn’t give a realistic comparison.

However, the 1970 figure he quotes is probably not far off the mark.
My first house was an unfinished new build which we got in 1974 at a cost of £4215.
We then had to fit it out, bathrooms, kitchen, heating, decorations etc.
I supposed a £4057 average house price in 1970 is realistic.

[Bristol Red Rover]

Definitely there are many health benefits scammers, but probably many times more than that who are not getting their deserved benefits. Universal Basic Income would easily, and economically, help address all of this.

[MachoMadness]

I guess that anyone that bought a house in the 1970s rather than the 50s or 60s was very lucky indeed, unless of course you were able to predict the market.

''Average UK house prices hit a record high in June, making today’s average house price 65 times more expensive than in 1970''

In 1950, the average cost of a new house was around £65,224 in today’s money
In 1960, the average cost of a home was approximately £55,784
At the start of the 1970s the average house price was £4,057
In 1980, the average house price shot up to £20,268
In 1990, it rose again to £58,153
In 2000, the average cost of a home reached £89,597
In 2010, this almost doubled to £170,365
In 2020, the average property in the UK valued at £249,633
And now in June 2022, house prices have reached a record high of £271,613

https://www.openaccessgovernment.org/uk-house-prices-are-65-times-higher-today-than-in-1970/138813/

This of course doesn't take into consideration where wages were over that period.

Is the 1970's figure correct Sydney? Are you sure it is 4,000 rather then 40,000? Your point about the 1970's would still be valid.  If it is 4K, what happened? A lot of building houses?

I was out of the country living in Germany and the Netherlands, but out of interest there was a large housing price crash at the beginning of the 1980's in the Netherlands. But it was a different market - most buyers in NL bought a house for life rather than gradually climbing up the housing ladder.

Assume the pre-decimalisation figures are adjusted for inflation, whereas the post-decimalisation ones aren't.

Using hound's house as an example, he paid the equivalent of £63,310 for his first house when adjusted for inflation. Lucky him!

[Filo]

Definitely there are many health benefits scammers, but probably many times more than that who are not getting their deserved benefits. Universal Basic Income would easily, and economically, help address all of this.

Those health benefit scammers are small in financial numbers compared to the Covid contract scammers and MP’s that milk their own system and tax dodge, from all sides of the house. But yet again the Government go after the poor

[i_ateallthepies]

Definitely there are many health benefits scammers, but probably many times more than that who are not getting their deserved benefits. Universal Basic Income would easily, and economically, help address all of this.

Those health benefit scammers are small in financial numbers compared to the Covid contract scammers and MP’s that milk their own system and tax dodge, from all sides of the house. But yet again the Government go after the poor

To paraphrase Forest Gump - Tory is as Tory does.

[idler]

A couple of my mates who both married in 1971 bought new build semis on Long Close Bessecar for about £2,300. A 4 bedroom detached at the bottom bottom of the street was about £4,100.
I married in May 1972 and gazumping had started by then. I ended up paying £4,200 for an old semi in  Sprotborough. Prices went crazy.

[BillyStubbsTears]

I guess that anyone that bought a house in the 1970s rather than the 50s or 60s was very lucky indeed, unless of course you were able to predict the market.

''Average UK house prices hit a record high in June, making today’s average house price 65 times more expensive than in 1970''

In 1950, the average cost of a new house was around £65,224 in today’s money
In 1960, the average cost of a home was approximately £55,784
At the start of the 1970s the average house price was £4,057
In 1980, the average house price shot up to £20,268
In 1990, it rose again to £58,153
In 2000, the average cost of a home reached £89,597
In 2010, this almost doubled to £170,365
In 2020, the average property in the UK valued at £249,633
And now in June 2022, house prices have reached a record high of £271,613

https://www.openaccessgovernment.org/uk-house-prices-are-65-times-higher-today-than-in-1970/138813/

This of course doesn't take into consideration where wages were over that period.

Is the 1970's figure correct Sydney? Are you sure it is 4,000 rather then 40,000? Your point about the 1970's would still be valid.  If it is 4K, what happened? A lot of building houses?

I was out of the country living in Germany and the Netherlands, but out of interest there was a large housing price crash at the beginning of the 1980's in the Netherlands. But it was a different market - most buyers in NL bought a house for life rather than gradually climbing up the housing ladder.

Assume the pre-decimalisation figures are adjusted for inflation, whereas the post-decimalisation ones aren't.

Using hound's house as an example, he paid the equivalent of £63,310 for his first house when adjusted for inflation. Lucky him!

Similar story for me.

First house bought for £31k in 1992. Two bed little semi in Conisbrough with little gardens front and back an a garage. That's equivalent to £65,000in today's money according to the BoE inflation calculator.

Just checked on Zoopla. It's currently valued at £136-150k.

I really don't get property owners of my generation and older who don't engage with how astonishingly lucky they have been to see house valuations rise so far out of proportion with salaries or the general economy. And how so many in the younger generations are being denied the right to ever own a home.

[silent majority]

Why it no longer pays to save for your retirement

https://www.telegraph.co.uk/money/pensions/state-pension-triple-lock-income-tax-jeremy-hunt/

Retirees will be paying income tax on the state pension within five years if the Tory deep freeze on tax thresholds continues.

Jeremy Hunt hailed the Government’s commitment to the triple lock as one of the “largest ever” cash increases to the state pension, boasting that it showed his Conservative Party “will always back our pensioners”.

What he didn’t say is that those who save for their own retirement are being punished heavily for their prudence under the Tories.

The truth is that for millions of pensioners, a large slice of their triple lock pay rise will be eaten up by income tax.

And let’s not forget that pensioners who pay income tax won’t see any of the benefits of the cut to National Insurance, which the over-66s do not pay.

The triple lock promise guarantees to increase the state pension every year, using the highest of either inflation, wages or 2.5pc.

Analysis of Office for Budget Responsibility (OBR) forecasts reveal that the new state pension is now expected to rise from just over £11,500 next year to around £12,800 in 2028 – meaning it crosses the personal allowance tax threshold.

In the meantime, the surging state pension means that retirees with their own saving income face more and more tax.

The Chancellor said his Autumn Statement would “make work pay”, but in reality the decision to keep a deep freeze on income tax thresholds means hard-earned private pensions savings are being taxed more than ever before.

Around one million people rely on the state pension alone to fund their retirement, the Chancellor said. This means that there are more than 11 million pensioners who have extra income on top, and now face tax bills thanks to “fiscal drag”.

The decision to freeze the personal tax-free allowance at £12,570 until 2028 while bumping the state pension up every year to match soaring inflation and wage growth means that it doesn’t take much of a private pension to get a tax bill in retirement.

The triple lock, which will drive up the state pension by 8.5pc in line with September’s wage growth, will see the new state pension increase by more than £900 a year to £11,500. It means a retired couple can rely on £23,000 a year in retirement, guaranteed by the state.

Analysis for Telegraph Money by pensions consultancy Lane Clark and Peacock shows that 8.5 million people aged 65 and over now pay income tax. This comes as 770,000 more were dragged into paying tax after the triple lock boosted the state pension by 10.1pc in April.

Next April, another 650,000 pensioners could be forced to pay tax on their income thanks to the 8.5pc increase. That’s a total of 9 million out of Britain’s 12.6 million state pensioners.

Fewer than 5 million over-65s paid income tax when the Tories came to power in 2010. Fewer than 3 million did 30 years ago.

The growing tax take means that the triple lock is not a 8.5pc pension pay rise for all. Those with their own retirement fund will surrender more to the taxman

[BillyStubbsTears]

I know the Telegraph has a mission, but that's a deeply weird article, even by their standards.

They seem to be telling pensioners to be disgusted that the state pension has gone up by nearly 20% in the past couple of years.

This line in particular:
"The truth (ahem!) is that for millions of pensioners, a large slice of their triple lock pay rise will be eaten up by income tax."

Let's have a think shall we?

The triple lock increase this year in the state pension is about £900.

Not uprating the personal allowance by inflation (which would have upped it by about £1,100) means that anyone with an annual pension of between about £14-50k will be paying about £220 more in income tax than they would be if the allowance had been uprated. Anyone with a pension between about £50-125k per year will pay an extra £440 per year in tax than they would have done.

Now, I don't know about you, but I doubt there are millions of pensioners getting annual pensions above £50k per year who are going to be pushed onto the breadline because they get a £900 handout and lose £400. But then again, I guess I'm not the Telegraph's target audience.

[i_ateallthepies]

I do get the point you make BST but there's the small matter of the actual inflation cost to add onto that £400 you mention.  Given the inflation we've seen in the last 12months pensioners too could still be well out of pocket.

[BillyStubbsTears]

Agreed, but pensioners ARE getting inflation level rises, in their state pension which is far more than, for example, public sector workers are getting. That's before any increase in private pension payments.

It's the whole tenor of that article that jars. It feels like it is complaining about one of the very good things that the Tories have done for the poorest pensioners, because it means wealthier pensioners not getting a bigger slice of the cake.

[SydneyRover]

Apologies, not much bandwidth/intermittent, atm in small town Tas

[i_ateallthepies]

Agreed, but pensioners ARE getting inflation level rises, in their state pension which is far more than, for example, public sector workers are getting. That's before any increase in private pension payments.

It's the whole tenor of that article that jars. It feels like it is complaining about one of the very good things that the Tories have done for the poorest pensioners, because it means wealthier pensioners not getting a bigger slice of the cake.

Entirely agree on that, BST and whilst I am amongst those set to benefit in the way you describe I too find it objectionable.

[silent majority]

Agreed, but pensioners ARE getting inflation level rises, in their state pension which is far more than, for example, public sector workers are getting. That's before any increase in private pension payments.

It's the whole tenor of that article that jars. It feels like it is complaining about one of the very good things that the Tories have done for the poorest pensioners, because it means wealthier pensioners not getting a bigger slice of the cake.

But its an inflation level rise on a small amount of money, not equitable with a full time job for example.

And increases in private pensions? That's definitely not universal, if anything private pensions have fallen dramatically in the last 12 months or so following from Liz Truss's disastrous attempt at tax cuts. It crippled the private pension sector. Add in inflation and pensioners are not doing very well at all.
 

[pib]

Imagine this happening to your estate!

https://www.theguardian.com/uk-news/2023/nov/23/revealed-king-charles-secretly-profiting-from-the-assets-of-dead-citizens

[BillyStubbsTears]

'A lot of these numbers... are sort of made up' - Paul Johnson, IFS, in his review of the Autumn Statement.

https://twitter.com/SophyRidgeSky/status/1727353906341282050

It's certainly starting to look that way as people start to drill down into the details that Hunt didn't mention.

The numbers stack up on the assumption that:

1) All Govt spending apart from health, defence and education is set to fall by 4.1% each and every year for the next 5 years.

2) The best part of half a million severely incapacitated people will be moved off that level of welfare.

Aye. Good luck with that.

A cynic might call this a scorched earth policy, leaving those who take over next year with the unpopular job of taking the really hard decisions.

As I was saying.

Here's that we'll known vipers' nest of economically illiterate Marxists...(checks notes)...err...The Economist, saying precisely the same thing about Hunt's plans

https://twitter.com/duncanrobinson/status/1727728938879693284