Second off, it's not in earned. It was earned by the parents or who ever who is leaving it behind. It's been taxed.Why should general society get a hand in?
There is definitely 2 sides posting within this group.
1) How dare anyone assume they are entitled to whatever happens to be left to them by whoever chooses to leave it to them without anything taxed.
2) People who think that because the assets have been accumulated through someone else's life, and had various forms of tax on whatever the assets are already placed on them through their life time, that it shouldn't then further be taxed when given in a will.
Whilst both sides are entitled to their opinion, I find it hard to follow this thread now with the underlying snipes between the two camps. It's hardly an adult way to handle things. It has potential to be a very informative thread for people. I for one am genuinely interested in the facts that people are stating here rather than assuming anyone ASKING is a self-entitled windfall merchant.
Most people are subject to double taxation (or sometimes more) .
Most of us pay income tax on earned income. We then pay VAT on goods that we purchase with our net (after tax) income. If we choose to invest in stocks and shares or buy a second property, we also pay tax on any income generated by those assets. When those investments are sold, we are liable to pay Capital Gains Tax on any profits made, subject to certain allowances/exemptions.
Inheritance tax is in many ways similar to Capital Gains Tax. For many (probably most) people, the biggest "profit" that they make in their lifetime will be the increase in the capital value of their home. This "profit" is not taxed during their lifetime (*see below), but is instead captured by Inheritance Tax when the property is "disposed of", i.e. when the estate is wound up. It should also be noted that IHT is a tax on the estate of the deceased, not on the beneficiaries - they simply receive their inheritance after tax has been deducted from the value of the estate. Personally, I regard this a windfall but others will no doubt disagree ...
IHT is a tax on wealth and whilst it may be imperfect, it is at least "progressive" (meaning that it impacts to the greatest extent on those who are wealthiest) so for the majority of people, it's probably better than the alternatives (e.g. raising income tax, VAT etc.)
* Council Tax bands and bills are based on property values in 1993 and therefore do not reflect the substantial increase in property values since then.
There is definitely 2 sides posting within this group.
1) How dare anyone assume they are entitled to whatever happens to be left to them by whoever chooses to leave it to them without anything taxed.
2) People who think that because the assets have been accumulated through someone else's life, and had various forms of tax on whatever the assets are already placed on them through their life time, that it shouldn't then further be taxed when given in a will.
Whilst both sides are entitled to their opinion, I find it hard to follow this thread now with the underlying snipes between the two camps. It's hardly an adult way to handle things. It has potential to be a very informative thread for people. I for one am genuinely interested in the facts that people are stating here rather than assuming anyone ASKING is a self-entitled windfall merchant.
Actually there is a third camp.
Those who, probably like myself, will stand to inherit from an estate where inheritance tax will be due and who is happy for that to be taxed
2) People who think that because the assets have been accumulated through someone else's life, and had various forms of tax on whatever the assets are already placed on them through their life time, that it shouldn't then further be taxed when given in a will.
That is my opinion put more perfectly than I ever could.
That is my opinion put more perfectly than I ever could.
I don't mean either option to come across as bad towards either. That's what makes it an interesting discussion, and helps more information come through. It's just the little snipes here and there that were starting to spoil it slightly.
I don't think Panixs meant that as a slight. I think the point about needing a good account and lawyer has been proven by how many of us here had no real understand of how IHT works.
First off, you've proven your first statement to be false with your last statement.
I really haven't. Its basic maths. Because the first 325k is not taxed, the total tax would never actually be 40% of the total amount left by the deceased.
Those who, probably like myself, will stand to inherit from an estate where inheritance tax will be due and who is happy for that to be taxed
Personally i would be very pleased (and incredibly lucky) to be getting an inheritance so large it is subject to inheritance tax. Its just pure selfishness to complain about some of that cash going to the greater good.
Personally i would be very pleased (and incredibly lucky) to be getting an inheritance so large it is subject to inheritance tax. Its just pure selfishness to complain about some of that cash going to the greater good.
You see I am from the other camp. I have done several things to ensure that should I pass away I have left people in a comfortable position.
Various things have already BEEN taxed for the greater good. I willingly choose and WISH for my property and assets to go to someone so that their life may be comfortable should it be for the rest of their days.
I don't think that as selfish. I think of that, as through my life I will have contributated in various ways, as will the receipient of my assets should I pass away before them, and we will have already helped contribute to the greater good as you say through our life times.
I stand by what I say in that I don't see that as selfish at all. More that I care about people that I may leave behind and wish for them to be comfortable to a degree (as much as you can in life anyway).
I wonder what options there are for "creative" valuation, not illegally so, but getting the lowest possible valuation using any potential trick in the book?
I wonder what options there are for "creative" valuation, not illegally so, but getting the lowest possible valuation using any potential trick in the book?
We did have a situation in our family where the three main beneficiaries were myself, my brother and my aunts partner. She'd expressly said she wanted him to be able to afford to buy her home with a comfortable mortgaged.
It all got very complicated but basically the 3rds were made up of the house, insurance polices and pensions.
The value of the house was more than anyone expected but we (all the beneficiaries) agreed on a lower sale price of the house to her partner.
It was below market value but it was all legal apparently.
The value in question is a few 10s of thousands over the 325K threshold, so a decently creative under valuation would be just the ticket. There must be lawyers out there who can do this stuff.
You see I am from the other camp. I have done several things to ensure that should I pass away I have left people in a comfortable position.
Various things have already BEEN taxed for the greater good. I willingly choose and WISH for my property and assets to go to someone so that their life may be comfortable should it be for the rest of their days.
I don't think that as selfish. I think of that, as through my life I will have contributated in various ways, as will the receipient of my assets should I pass away before them, and we will have already helped contribute to the greater good as you say through our life times.
I stand by what I say in that I don't see that as selfish at all. More that I care about people that I may leave behind and wish for them to be comfortable to a degree (as much as you can in life anyway).
I don't think the person giving away the wealth can ever be thought of as selfish, and I'm sure everybody wants to give their loved ones a comfortable inheritance upon their passing.
What is selfish is receiving a large inheritance and then wanting it to be even bigger, causing other needy causes to miss out as a result.
The value in question is a few 10s of thousands over the 325K threshold, so a decently creative under valuation would be just the ticket. There must be lawyers out there who can do this stuff.
You could indeed try to defraud the system for personal gain, or you could just pay what is going to be a very small amount of tax in light of the overall sum of money.
I don't think the person giving away the wealth can ever be thought of as selfish, and I'm sure everybody wants to give their loved ones a comfortable inheritance upon their passing.
What is selfish is receiving a large inheritance and then wanting it to be even bigger, causing other needy causes to miss out as a result.
Tax isn't a charity though? It is rare that people are millionaires, nor very well off in this day and age, and whilst they're not dependant upon any leavings as a life or death situation, it could potentially make their lives a lot more comfortable. It would be my wish that my full estate is distributed how I dictate in my will. Thats my money, my assets, my valuables that I have earned through my life. I don't think thats an unreasonable want?
You could indeed try to defraud the system for personal gain, or you could just pay what is going to be a very small amount of tax in light of the overall sum of money.
I could be wrong, but I think what started this is that it's not that small. And could potentially cause people to have to sell family homes, or be indebted for 10 years in order to pay off something that they really dont have a lot of control over. I could be misreading though.
I could be wrong, but I think what started this is that it's not that small. And could potentially cause people to have to sell family homes, or be indebted for 10 years in order to pay off something that they really dont have a lot of control over. I could be misreading though.
"A few 10s of thousands" was what was quoted. So lets say its 30k over. Tax on that is going to be 12k.
12k out of a total inheritance of 355k is about 3%. 3% tax is tiny! I don't think anyone is going to be loosing there home over a debt that is 3% if the total value of the property.
But where does tax go? Schools and hospitals are quite nice things to have.
"A few 10s of thousands" was what was quoted. So lets say its 30k over. Tax on that is going to be 12k.
12k out of a total inheritance of 355k is about 3%. 3% tax is tiny! I don't think anyone is going to be loosing there home over a debt that is 3% if the total value of the property.
Those who, probably like myself, will stand to inherit from an estate where inheritance tax will be due and who is happy for that to be taxed
This goes for me too.
And as I was reading through the thread I was itching to add that I had never understood the argument that you shouldn't pay tax on inherited wealth as tax had already been paid on it, as the same could be said about almost all taxes you pay. But then I got to Yosemite's post #74 which makes that point excellently.
I always wondered what would happen, if gave away £500,000 amongst, say 10 friends to share and I died 1 year later. I assume the taxman goes after them, what would happen if there was no record whom I gave them to and that I left no further assets. ;-)
But you would have amassed that wealth because of your health and your education.
This point makes no sense to me. If we go through life paying taxes we pay for health and schools. Debt repaid.
Why then should my things be taxed a again when I've died?
Surely it's the hospitals fault in the first place that I died....as most likely that's the last place I'd be seen alive ( joking joking)
Comments
See post #74.
1) How dare anyone assume they are entitled to whatever happens to be left to them by whoever chooses to leave it to them without anything taxed.
2) People who think that because the assets have been accumulated through someone else's life, and had various forms of tax on whatever the assets are already placed on them through their life time, that it shouldn't then further be taxed when given in a will.
Whilst both sides are entitled to their opinion, I find it hard to follow this thread now with the underlying snipes between the two camps. It's hardly an adult way to handle things. It has potential to be a very informative thread for people. I for one am genuinely interested in the facts that people are stating here rather than assuming anyone ASKING is a self-entitled windfall merchant.
Thank you for this. Very interesting read.
Those who, probably like myself, will stand to inherit from an estate where inheritance tax will be due and who is happy for that to be taxed
That is my opinion put more perfectly than I ever could.
You reckon?
We're not rich, but we're happy to invest a decent amount to avoid a quite monumental bill as and when.
You're quite right. Apologies.
I don't mean either option to come across as bad towards either. That's what makes it an interesting discussion, and helps more information come through. It's just the little snipes here and there that were starting to spoil it slightly.
I really haven't. Its basic maths. Because the first 325k is not taxed, the total tax would never actually be 40% of the total amount left by the deceased.
Personally i would be very pleased (and incredibly lucky) to be getting an inheritance so large it is subject to inheritance tax. Its just pure selfishness to complain about some of that cash going to the greater good.
You see I am from the other camp. I have done several things to ensure that should I pass away I have left people in a comfortable position.
Various things have already BEEN taxed for the greater good. I willingly choose and WISH for my property and assets to go to someone so that their life may be comfortable should it be for the rest of their days.
I don't think that as selfish. I think of that, as through my life I will have contributated in various ways, as will the receipient of my assets should I pass away before them, and we will have already helped contribute to the greater good as you say through our life times.
I stand by what I say in that I don't see that as selfish at all. More that I care about people that I may leave behind and wish for them to be comfortable to a degree (as much as you can in life anyway).
It all got very complicated but basically the 3rds were made up of the house, insurance polices and pensions.
The value of the house was more than anyone expected but we (all the beneficiaries) agreed on a lower sale price of the house to her partner.
It was below market value but it was all legal apparently.
I don't think the person giving away the wealth can ever be thought of as selfish, and I'm sure everybody wants to give their loved ones a comfortable inheritance upon their passing.
What is selfish is receiving a large inheritance and then wanting it to be even bigger, causing other needy causes to miss out as a result.
You could indeed try to defraud the system for personal gain, or you could just pay what is going to be a very small amount of tax in light of the overall sum of money.
Tax isn't a charity though? It is rare that people are millionaires, nor very well off in this day and age, and whilst they're not dependant upon any leavings as a life or death situation, it could potentially make their lives a lot more comfortable. It would be my wish that my full estate is distributed how I dictate in my will. Thats my money, my assets, my valuables that I have earned through my life. I don't think thats an unreasonable want?
I could be wrong, but I think what started this is that it's not that small. And could potentially cause people to have to sell family homes, or be indebted for 10 years in order to pay off something that they really dont have a lot of control over. I could be misreading though.
But where does tax go? Schools and hospitals are quite nice things to have.
"A few 10s of thousands" was what was quoted. So lets say its 30k over. Tax on that is going to be 12k.
12k out of a total inheritance of 355k is about 3%. 3% tax is tiny! I don't think anyone is going to be loosing there home over a debt that is 3% if the total value of the property.
Thanks for clarifying for me.
Well this valid also.
But you would have amassed that wealth because of your health and your education.
This goes for me too.
And as I was reading through the thread I was itching to add that I had never understood the argument that you shouldn't pay tax on inherited wealth as tax had already been paid on it, as the same could be said about almost all taxes you pay. But then I got to Yosemite's post #74 which makes that point excellently.
Why then should my things be taxed a again when I've died?
Surely it's the hospitals fault in the first place that I died....as most likely that's the last place I'd be seen alive