Qwerty
Striker
That's why I said it could be deferred 5 years. Gives him time to join the workforce, then he can easily get a £150k mortgage for a £600k house. For a 23 year old to be in that financial situation is tremendous.
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Inheritance Tax Penalty: who pays?
- Thread starter CatRyan
- Start date
Aren’t there equity release schemes where you basically sell a share in the house against a future sale for a percentage of its value? I’ve no doubt there’ll be extortionate fees involved but if it means Great Aunt Mildred can stay in the house she shared with her brother for the past 87 years then that has to be a good thing? The rellies then pick the bones of what’s leftover after she’s pegged it and the house is sold while the company shelling out for her over the years take their cut.
I reckon there are likely several ways around situations from changing the type of ownership of the house, to bank loans, to what you posted, I don't know all the ins and outs. I think one poster said the IHT could be deferred at a cost (?)
My initial example (post #35 from memory) was putting a sympathetic take on perhaps tweaking the IHT where paying the IHT was detrimental to the person who had to pay it.
Kent_Mackem
Striker
Why though? They didn't earn it, you did.
Am I missing something here? Don't almost all young people / students do that?
They might look the gift horse in the mouth once you are gone though....
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on a very quick look and only out of interest, it looks like it has to be in place before the death (and a subsequent IHT bill) I am happy to be put right though.
I guess when the estate is valued you can't then go reducing the assets [value] by 'getting rid of stuff'.
Because that’s where I want my money to go when I’m gone. The state hasn’t earned it either, so why should they be entitled to 40%?
Possibly. Be a shame if people end up twisting about the tax deduction on what I leave them, especially as I'll make clear I'm not going out of my way to try and avoid it.
Qwerty
Striker
To pay for services?
The 45% tax I’m paying on my income already should more than cover my share.
Qwerty
Striker
You won't be paying any inheritance tax.
People don't like paying tax, I get that, however it's necessary.
How do you know?
42
Striker
Cos you mentioned it last time it was highly unlikely you would, oh and you'll be dead
Mackem00
Striker
Because you'll be dead. The person receiving the gift will be paying it. It's a victimless "crime".
You have just made this up.
The person paying the bill is the person who has died. The bill is calculated on the estate value at death, before any distributions, so it doesn’t make sense to suggest it’s the person who’s receiving the gift who pays it.
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42
Striker
Might not have explicitly stated it, but it's the impression you gave since you kept dodging the question
Mackem00
Striker
Only if you are willfully ignoring the obvious.
So you made it up then.
The calculations are what they are so it's a tough one to argue against.
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42
Striker
Not really, you said you weren't due any inheritance, then rambled on about ambition which suggests your current status is that you're below the limit.
You are reading things that aren't there.
IHT is anti-family and the current thresholds and rates are arbitrary. 40% on whatever's left if you get hit by a bus or killed by a short illness is very, very heavy. I think building some wealth to secure your family's future (and therefore less likely to be a burden on the state) is a noble venture that should be incentivised, not penalised. The current rules in this country do not do that for anyone but the very, very wealthy.
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Qwerty
Striker
You'll be dead, if it somehow isn't paid you won't be chased for it.
