| Inheritance tax 11:56 - Sep 24 with 3878 views | DJR |
I mentioned a hint of this on another thread, but the Sunday Times today is firming up the fact that the Tories look like they are going to pull something out of the hat on inheritance tax before the election to huge public approval.
But as I said on that thread, and as the the following from the paper indicates, the vast majority will never come anyway near to paying the tax. But it just goes to indicate another area where the Tories use public ignorance to their advantage.
"... government advisers are clear that there are political gains to be made this side of an election. “This is the most hated tax in Britain, according to the polls,” the source said. “It’s the most hated tax at every income. A lot of people don’t know they won’t pay it. People also feel it is just wrong to tax people on income that has already been taxed – and at a time when they are grieving.”
The most recent Treasury figures show that only 3.76 per cent of UK deaths result in an inheritance tax charge. However, YouGov polling for The Times suggests that almost a third (31 per cent) of people think their assets will be enough to attract inheritance tax when they die, and 15 per cent expect to receive an inheritance large enough to attract the tax. Only 5 per cent know the threshold for inheritance tax was usually £1 million."
[Post edited 24 Sep 2023 11:57]
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| Inheritance tax on 12:01 - Sep 24 with 3216 views | The_Flashing_Smile |
What do you mean the threshold for inheritance tax "was usually" £1 million? What's the caveat there?
I must admit, I assumed my parents' money would be taxed when they die, I had no idea the threshold was as high as you suggest. |  |
| Trust the process. Trust Phil. |
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| Inheritance tax on 12:05 - Sep 24 with 3177 views | tractordownsouth |
Hilarious how these Tories love to rail against poor people getting “handouts” but kick and scream at the prospect of having to pay a bit of tax on the £1m they’ve inherited from the bank of mum and dad. |  |
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| Inheritance tax on 12:08 - Sep 24 with 3168 views | Ryorry |
Clearly aimed at wealthy tories who were probably diehard bluerinses anyway, so doubt it'll change the polls much.
If the threshold's now £1m, then it's already been massively upped since 2012 when I was executor of a will that was a long way short of that sum, but still incurred 40% IHT. |  |
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| Inheritance tax on 12:12 - Sep 24 with 3149 views | Keno |
| Inheritance tax on 12:01 - Sep 24 by The_Flashing_Smile |
What do you mean the threshold for inheritance tax "was usually" £1 million? What's the caveat there?
I must admit, I assumed my parents' money would be taxed when they die, I had no idea the threshold was as high as you suggest. |
the individual allowance is £325,000 plus residential nil rate band of £175,000 makes £500,000.
On the death of a spouse if they do use their allowances they pass to the survivor and on the 2nd death it means the total available allowances can be £1,000,000 |  |
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| Inheritance tax on 12:12 - Sep 24 with 3139 views | Cheltenham_Blue |
| Inheritance tax on 12:08 - Sep 24 by Ryorry |
Clearly aimed at wealthy tories who were probably diehard bluerinses anyway, so doubt it'll change the polls much.
If the threshold's now £1m, then it's already been massively upped since 2012 when I was executor of a will that was a long way short of that sum, but still incurred 40% IHT. |
Its £500k if passed to Children or Grandchildren, but married couples can share their allowance, meaning the the threshold stands at £1m
However, it's only £350k if passed to anyone else. Given the average cost of a house now..... |  |
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| Inheritance tax on 12:13 - Sep 24 with 3135 views | mutters |
| Inheritance tax on 12:08 - Sep 24 by Ryorry |
Clearly aimed at wealthy tories who were probably diehard bluerinses anyway, so doubt it'll change the polls much.
If the threshold's now £1m, then it's already been massively upped since 2012 when I was executor of a will that was a long way short of that sum, but still incurred 40% IHT. |
The millions figure relates to a married couple who can share their IHT free allowance and also have a property to pass down. Normally each person has £325k allowance , but on top of this you get a residence nil-rate band is £175,000, meaning your overall IHT allowance could increase to £500,000. |  |
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| Inheritance tax on 12:23 - Sep 24 with 3097 views | Ryorry |
| Inheritance tax on 12:12 - Sep 24 by Cheltenham_Blue |
Its £500k if passed to Children or Grandchildren, but married couples can share their allowance, meaning the the threshold stands at £1m
However, it's only £350k if passed to anyone else. Given the average cost of a house now..... |
That would explain it, thanks (Mutters too). | |
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| Inheritance tax on 12:26 - Sep 24 with 3081 views | Nthsuffolkblue |
| Inheritance tax on 12:01 - Sep 24 by The_Flashing_Smile |
What do you mean the threshold for inheritance tax "was usually" £1 million? What's the caveat there?
I must admit, I assumed my parents' money would be taxed when they die, I had no idea the threshold was as high as you suggest. |
Usually £1 million because if you have greater worth you can set up funds to still avoid it.
EDIT: This is in addition to what Mutters clarified. [Post edited 24 Sep 2023 12:35]
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| Inheritance tax on 12:31 - Sep 24 with 3053 views | BanksterDebtSlave |
| Inheritance tax on 12:13 - Sep 24 by mutters |
The millions figure relates to a married couple who can share their IHT free allowance and also have a property to pass down. Normally each person has £325k allowance , but on top of this you get a residence nil-rate band is £175,000, meaning your overall IHT allowance could increase to £500,000. |
What happens after any property is sold, is that then taxed at 40 per cent? |  |
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| Inheritance tax on 12:35 - Sep 24 with 3030 views | DJR |
| Inheritance tax on 12:01 - Sep 24 by The_Flashing_Smile |
What do you mean the threshold for inheritance tax "was usually" £1 million? What's the caveat there?
I must admit, I assumed my parents' money would be taxed when they die, I had no idea the threshold was as high as you suggest. |
There isn't really a caveat, assuming the assets and family home are left to the surviving spouse, and when the surviving spouse dies are then left to the children. Having said that, lifetime gifts may reduce it.
And if the value of the family home is less than £350,000. the exemption will be £650,000 plus the value of the house. | | | |
| Inheritance tax on 12:37 - Sep 24 with 3015 views | strikalite |
| Inheritance tax on 12:12 - Sep 24 by Cheltenham_Blue |
Its £500k if passed to Children or Grandchildren, but married couples can share their allowance, meaning the the threshold stands at £1m
However, it's only £350k if passed to anyone else. Given the average cost of a house now..... |
Re your last sentence, so if say an estate of £700k was passed on to someone, do you get taxed on anything after £350k or on the full £700k? |  | | |
| Inheritance tax on 12:38 - Sep 24 with 3006 views | Nthsuffolkblue |
| Inheritance tax on 12:08 - Sep 24 by Ryorry |
Clearly aimed at wealthy tories who were probably diehard bluerinses anyway, so doubt it'll change the polls much.
If the threshold's now £1m, then it's already been massively upped since 2012 when I was executor of a will that was a long way short of that sum, but still incurred 40% IHT. |
I think it is more aimed at those who, in ignorance, are unaware there is a big sum that is tax-free already.
The wealthiest will already have set up funds that avoid paying it (as long as they are set up far in enough advance) on the advice of their financial advisors. | |
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| Inheritance tax on 12:42 - Sep 24 with 2982 views | DJR |
| Inheritance tax on 12:08 - Sep 24 by Ryorry |
Clearly aimed at wealthy tories who were probably diehard bluerinses anyway, so doubt it'll change the polls much.
If the threshold's now £1m, then it's already been massively upped since 2012 when I was executor of a will that was a long way short of that sum, but still incurred 40% IHT. |
In 2012, if it were the estate of a surviving spouse, the threshold would have been potentially £650,000.
I think you will find its popularity extends to those way off the thresholds.
As the quote in the OP indicates, it is the most unpopular tax regardless of income.
And ignorance (not meant pejoratively) on this plays into the Tories' hands. | | | |
| Inheritance tax on 12:44 - Sep 24 with 2960 views | Swansea_Blue |
| Inheritance tax on 12:31 - Sep 24 by BanksterDebtSlave |
What happens after any property is sold, is that then taxed at 40 per cent? |
No. The estimated value of the property is included in the estimated value of the estate declared for tax purposes. Once sold, tax would only apply on the potion of the value over the IHT threshold (which could be £500k for a single couple or the c. £1M for a married couple if the spouses allowance wasn’t used when they died). So it possible, normal even, to not pay IHT on ‘normal’ properties (mansions excluded!). |  |
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| Inheritance tax on 12:52 - Sep 24 with 2926 views | Nthsuffolkblue |
| Inheritance tax on 12:37 - Sep 24 by strikalite |
Re your last sentence, so if say an estate of £700k was passed on to someone, do you get taxed on anything after £350k or on the full £700k? |
Only on anything passed on above the threshold (and only if that isn't in a fund excluded from tax). | |
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| Inheritance tax on 13:14 - Sep 24 with 2867 views | DJR |
| Inheritance tax on 12:37 - Sep 24 by strikalite |
Re your last sentence, so if say an estate of £700k was passed on to someone, do you get taxed on anything after £350k or on the full £700k? |
Only above £350,000, otherwise it would be especially harsh. | | | |
| Inheritance tax on 13:40 - Sep 24 with 2775 views | bluefunk |
| Inheritance tax on 13:14 - Sep 24 by DJR |
Only above £350,000, otherwise it would be especially harsh. |
As has been said on this thread previously, the basic threshold for IHT is £325k, not £350k. If you are passing on a property to children, then you also get an additional £175k. Those are per person thresholds and they are transferable between spouses, so an individual leaving an estate, which includes property, has an effective threshold of £500k, a married couple, on second death £1m. Tax is the paid on the surplus at 40%.
If anything, this thread is a great demonstration of the level of misinformation around inheritance tax. Despite several posters providing the correct figures, still there are some ignoring them. |  | | |
| Inheritance tax on 15:40 - Sep 24 with 2584 views | DJR |
| Inheritance tax on 13:40 - Sep 24 by bluefunk |
As has been said on this thread previously, the basic threshold for IHT is £325k, not £350k. If you are passing on a property to children, then you also get an additional £175k. Those are per person thresholds and they are transferable between spouses, so an individual leaving an estate, which includes property, has an effective threshold of £500k, a married couple, on second death £1m. Tax is the paid on the surplus at 40%.
If anything, this thread is a great demonstration of the level of misinformation around inheritance tax. Despite several posters providing the correct figures, still there are some ignoring them. |
That was an error on my part in not spotting the incorrect figure of £350,000, but as the instigator of this post, and someone who has recently, without the use of a firm of solicitors, obtained probate, I fully know the law.
Even thought there was no inheritance tax to pay, obtaining probate involved the completion of eleven HMRC forms, including forms for the transfer of the unused nil rate band, the use of the residence nil rate band and the transfer of unused residence nil rate band. The process was not particularly straightforward, and for most people in my circumstances would be best left to a firm of solicitors. But I had the expertise to do it, and in doing so saved legal costs.
However, the vast majority of inheritances will be much more straightforward, because things have been much simplified. [Post edited 24 Sep 2023 15:56]
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| Inheritance tax on 15:58 - Sep 24 with 2532 views | heavyweight |
| Inheritance tax on 13:40 - Sep 24 by bluefunk |
As has been said on this thread previously, the basic threshold for IHT is £325k, not £350k. If you are passing on a property to children, then you also get an additional £175k. Those are per person thresholds and they are transferable between spouses, so an individual leaving an estate, which includes property, has an effective threshold of £500k, a married couple, on second death £1m. Tax is the paid on the surplus at 40%.
If anything, this thread is a great demonstration of the level of misinformation around inheritance tax. Despite several posters providing the correct figures, still there are some ignoring them. |
There are also extra exemptions - for instance agricultural land is exempt, subject to certain conditions. |  | | |
| Inheritance tax on 16:51 - Sep 24 with 2387 views | bluelagos |
| Inheritance tax on 15:58 - Sep 24 by heavyweight |
There are also extra exemptions - for instance agricultural land is exempt, subject to certain conditions. |
And the Royal family who I believe paid the grand sum of fck all IHT. |  |
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| Inheritance tax on 17:04 - Sep 24 with 2355 views | DJR |
| Inheritance tax on 16:51 - Sep 24 by bluelagos |
And the Royal family who I believe paid the grand sum of fck all IHT. |
According to the following, the Queen's estate at her death was worth £68.5 billion.
https://www.mirror.co.uk/news/uk-news/queen-worth-68billion-died-fortune-2801304
By my calculation, that would have involved inheritance tax of just over £27 billion, but for the Royal Family exemption.
That would have fixed a fair few potholes! | | | |
| Inheritance tax on 17:10 - Sep 24 with 2330 views | bluelagos |
They can't really hide behind the "We've already paid tax on that" defense either. | |
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| Inheritance tax on 17:18 - Sep 24 with 2304 views | DJR |
| Inheritance tax on 17:10 - Sep 24 by bluelagos |
They can't really hide behind the "We've already paid tax on that" defense either. |
Still, unlike other aristocrats, it saves them having to gift the Royal palaces to the National Trust to settle their inheritance tax bills.
"This is the Michael Fagan Bedroom, named after the intruder who got into the Queen's bedroom." [Post edited 24 Sep 2023 17:22]
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| Inheritance tax on 19:47 - Sep 24 with 2116 views | Crawfordsboot |
| Inheritance tax on 17:10 - Sep 24 by bluelagos |
They can't really hide behind the "We've already paid tax on that" defense either. |
I’m with you Lagos
Sack the lot of em. |  | | |
| Inheritance tax on 20:43 - Sep 24 with 2023 views | mutters |
Not that I am trying to defend the royal family not paying their fair share of tax the vast majority of her wealth is owned by the crown, which is not actually assessable for IHT as I understand it. The 430 million quoted should be however, like a lot of people various trusts etc can be used to mitigate these taxes. Lots of ways to evade sorry I meant avoid tax 😜 | |
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