That's up to them and their conscience as to whether to accept this lifestyle but I know people who happily do and in 10 or 20 years time will also be inheriting multimillion pound properties, which our government feels should now be exempt from tax on the first million.
Sorry but that just doesn't sit comfortably with me.
Or perhaps it's a compromise, the government couldn't see a better way to avoid those with less than a million being taxed.
By the way, what's the difference if you choose not to work if you are poor and have the State look after you, but it's wrong if you choose not to work, are rich, and mummy and daddy look after you?
The government with their endless propaganda about what a burden the unemployed and unfit for work are on our tax revenues certainly appear to think there is a huge difference, Dippenhall. One lot they are always picking on (and not without justification in SOME cases) the others they are falling over themselves to appease and make even more comfortable...
One set of people contribute to society，the other doesn't.
How do the people who choose not to work and live off Mummy and Daddy's money contribute to society Stu?
I included mummy and daddy in the set of people, they have earned that money, paid and continue to pay tax on those earnings, it is their right to decide how that money is spent.
That wasn't what was said though, was it.
You asked how I thought a set of people contributed to society, I explained.
Either way, those living off their parents are much loss of a burden than those living off the state.
Incorrect. Read the thread, a specific question was put, an answer was given, then you suddenly brought the parents into the equation to suit your argument. Moving the goalposts, that's the expression I believe. You are right, but that was not the point made originally.
How can the parents not be in the equation, it's them spending the money.
Because that was not the question that was asked. Read the thread...
"However I disagree with your premise that the NHS was set up to deal with the sickness of 'old age'." Quote: The new prime minister, Clement Attlee, announced he would introduce the welfare state outlined in the 1942 Beveridge Report. This included the establishment of a National Health Service in 1948 with free medical treatment for all. A national system of benefits was also introduced to provide 'social security' so that the population would be protected from the 'cradle to the grave'.
"However I disagree with your premise that the NHS was set up to deal with the sickness of 'old age'." Quote: The new prime minister, Clement Attlee, announced he would introduce the welfare state outlined in the 1942 Beveridge Report. This included the establishment of a National Health Service in 1948 with free medical treatment for all. A national system of benefits was also introduced to provide 'social security' so that the population would be protected from the 'cradle to the grave'.
Beat me to it.
Incidentally my original post actually referred to all sickness not just the sickness of old age.
My view let me reiterate is that treatment for all illness should be free with no weaselling around with different categories of care to justify extorting money from the sick. If the care is needed because of the detrimental effects of the illness it is health care.
However Red In SE8 has expressed a view that elderly property owners should pay for NHS treatment if I've understood him correctly. If I was going to charge for NHS treatment, which I reiterate I do not believe in, then the people who should be charged are those who have some choice as to using NHS facitilities rather than dementia patients. For example I read somewhere (no time to search it out just now) that at least 50% of A&E visits are 'avoidable' and are attributable directly or indirectly to alcohol or drug abuse be it damage to the individual or the mind altering effects making that individual damage others.
If I was going down the charging route then these are the people I would charge as those charges may act as a deterrent and relieve overburdened A&E departments of avoidable, unnecessary work thus improving the treatment and survival possibilities of the genuinely ill.
I would also ruthlessly attack the gross inefficencies that exist on the 'non clinical' side of the NHS. Labour's flagship PFI Scheme which swallows money, the rigged procurement market which means that medical supplies and drugs cost far more than necessary and the money pit useless IT development rife throughout the NHS to name but three.
However this is a subject for another thread and I am straying too far from inheritance tax and its modern incarnation social care.
"However I disagree with your premise that the NHS was set up to deal with the sickness of 'old age'." Quote: The new prime minister, Clement Attlee, announced he would introduce the welfare state outlined in the 1942 Beveridge Report. This included the establishment of a National Health Service in 1948 with free medical treatment for all. A national system of benefits was also introduced to provide 'social security' so that the population would be protected from the 'cradle to the grave'.
People are living 10 or 15 years longer now. Are you saying we should blindly follow policies from 70 years ago and not adapt to the changing circumstances of today's world?
"However I disagree with your premise that the NHS was set up to deal with the sickness of 'old age'." Quote: The new prime minister, Clement Attlee, announced he would introduce the welfare state outlined in the 1942 Beveridge Report. This included the establishment of a National Health Service in 1948 with free medical treatment for all. A national system of benefits was also introduced to provide 'social security' so that the population would be protected from the 'cradle to the grave'.
People are living 10 or 15 years longer now. Are you saying we should blindly follow policies from 70 years ago and not adapt to the changing circumstances of today's world?
And that, I think will be more or less the argument, put forward more and more. Short of a mass culling of the old and infirm the problem will not go away. Give it another 20 years we will probably be paying more for services of NHS a lot more. Or at least those of us lucky enough to have assets will. Probably will allow euthanasia in a few years time, then we will all be able to pass on our money to our children and not to some owner of so called care home.
"However I disagree with your premise that the NHS was set up to deal with the sickness of 'old age'." Quote: The new prime minister, Clement Attlee, announced he would introduce the welfare state outlined in the 1942 Beveridge Report. This included the establishment of a National Health Service in 1948 with free medical treatment for all. A national system of benefits was also introduced to provide 'social security' so that the population would be protected from the 'cradle to the grave'.
People are living 10 or 15 years longer now. Are you saying we should blindly follow policies from 70 years ago and not adapt to the changing circumstances of today's world?
Read again, I'm just correcting a misinformed statement about the original aspirations of the NHS.
How long the NHS can stick to that historic pledge is another matter. But there should be transparency and fairness in making changes, not changes through the back door that pretend the NHS is still what it was designed to be.
"However I disagree with your premise that the NHS was set up to deal with the sickness of 'old age'." Quote: The new prime minister, Clement Attlee, announced he would introduce the welfare state outlined in the 1942 Beveridge Report. This included the establishment of a National Health Service in 1948 with free medical treatment for all. A national system of benefits was also introduced to provide 'social security' so that the population would be protected from the 'cradle to the grave'.
Clement Attlee also wanted to ban privatised healthcare so you couldn't pay for healthcare even if you wanted to if he got away with his dystopian vision.
Not that I agree that old people who aren't penniless should be forced to pay for healthcare. I don't think people should be forced to pay for healthcare just because it's a disease/illness only/mostly old people get. Why not make old people, who are easier for criminals to target, be made to pay for their own police as well? They're going to be dead soon anyway, right so they don't need their money?
"However I disagree with your premise that the NHS was set up to deal with the sickness of 'old age'." Quote: The new prime minister, Clement Attlee, announced he would introduce the welfare state outlined in the 1942 Beveridge Report. This included the establishment of a National Health Service in 1948 with free medical treatment for all. A national system of benefits was also introduced to provide 'social security' so that the population would be protected from the 'cradle to the grave'.
People are living 10 or 15 years longer now. Are you saying we should blindly follow policies from 70 years ago and not adapt to the changing circumstances of today's world?
You've changed your tune since the Election thread.
"However I disagree with your premise that the NHS was set up to deal with the sickness of 'old age'." Quote: The new prime minister, Clement Attlee, announced he would introduce the welfare state outlined in the 1942 Beveridge Report. This included the establishment of a National Health Service in 1948 with free medical treatment for all. A national system of benefits was also introduced to provide 'social security' so that the population would be protected from the 'cradle to the grave'.
People are living 10 or 15 years longer now. Are you saying we should blindly follow policies from 70 years ago and not adapt to the changing circumstances of today's world?
You've changed your tune since the Election thread.
Perhaps you should have a look at what you were posting about the NHS and the Tories 'privatising' it - or "adapting it to the changing circumstances of today's World" which is what they are trying to do.
"However I disagree with your premise that the NHS was set up to deal with the sickness of 'old age'." Quote: The new prime minister, Clement Attlee, announced he would introduce the welfare state outlined in the 1942 Beveridge Report. This included the establishment of a National Health Service in 1948 with free medical treatment for all. A national system of benefits was also introduced to provide 'social security' so that the population would be protected from the 'cradle to the grave'.
Clement Attlee also wanted to ban privatised healthcare so you couldn't pay for healthcare even if you wanted to if he got away with his dystopian vision.
Not that I agree that old people who aren't penniless should be forced to pay for healthcare. I don't think people should be forced to pay for healthcare just because it's a disease/illness only/mostly old people get. Why not make old people, who are easier for criminals to target, be made to pay for their own police as well? They're going to be dead soon anyway, right so they don't need their money?
I think some people are missing the point and/or being deliberately disingenuous. I don't think it is the case that old people have to pay for their healthcare at the moment. Even if it is an age related problem such as a knee or hip replacement. In fact, I know this is not the case. And I am not suggesting this should change. The scenario I am refering to is where an old person needs 24 hour care for the rest of their lives and don't have a family who are willing or able to provide that care and therefore have to move into a care home. It is my opinion that it is not unreasonable to expect that if that person has assets those assets should be used to contribute to the cost of this care.
Perhaps you should have a look at what you were posting about the NHS and the Tories 'privatising' it - or "adapting it to the changing circumstances of today's World" which is what they are trying to do.
"However I disagree with your premise that the NHS was set up to deal with the sickness of 'old age'." Quote: The new prime minister, Clement Attlee, announced he would introduce the welfare state outlined in the 1942 Beveridge Report. This included the establishment of a National Health Service in 1948 with free medical treatment for all. A national system of benefits was also introduced to provide 'social security' so that the population would be protected from the 'cradle to the grave'.
Clement Attlee also wanted to ban privatised healthcare so you couldn't pay for healthcare even if you wanted to if he got away with his dystopian vision.
Not that I agree that old people who aren't penniless should be forced to pay for healthcare. I don't think people should be forced to pay for healthcare just because it's a disease/illness only/mostly old people get. Why not make old people, who are easier for criminals to target, be made to pay for their own police as well? They're going to be dead soon anyway, right so they don't need their money?
I think some people are missing the point and/or being deliberately disingenuous. I don't think it is the case that old people have to pay for their healthcare at the moment. Even if it is an age related problem such as a knee or hip replacement. In fact, I know this is not the case. And I am not suggesting this should change. The scenario I am refering to is where an old person needs 24 hour care for the rest of their lives and don't have a family who are willing or able to provide that care and therefore have to move into a care home. It is my opinion that it is not unreasonable to expect that if that person has assets those assets should be used to contribute to the cost of this care.
What if they give all their assets away before requesting 24-hour care from the state?
"However I disagree with your premise that the NHS was set up to deal with the sickness of 'old age'." Quote: The new prime minister, Clement Attlee, announced he would introduce the welfare state outlined in the 1942 Beveridge Report. This included the establishment of a National Health Service in 1948 with free medical treatment for all. A national system of benefits was also introduced to provide 'social security' so that the population would be protected from the 'cradle to the grave'.
Clement Attlee also wanted to ban privatised healthcare so you couldn't pay for healthcare even if you wanted to if he got away with his dystopian vision.
Not that I agree that old people who aren't penniless should be forced to pay for healthcare. I don't think people should be forced to pay for healthcare just because it's a disease/illness only/mostly old people get. Why not make old people, who are easier for criminals to target, be made to pay for their own police as well? They're going to be dead soon anyway, right so they don't need their money?
I think some people are missing the point and/or being deliberately disingenuous. I don't think it is the case that old people have to pay for their healthcare at the moment. Even if it is an age related problem such as a knee or hip replacement. In fact, I know this is not the case. And I am not suggesting this should change. The scenario I am refering to is where an old person needs 24 hour care for the rest of their lives and don't have a family who are willing or able to provide that care and therefore have to move into a care home. It is my opinion that it is not unreasonable to expect that if that person has assets those assets should be used to contribute to the cost of this care.
What if they give all their assets away before requesting 24-hour care from the state?
There are existing rules that faciltate the inland revenue chasing assets that have been given away by people before they die in order to avoid/reduce inheritance tax. They don't work very well but the principle is there.
". In perhaps the daftest economic policy of the decade, inheritance tax was cut—but only on houses. A new allowance for homes means that estates worth up to £1m ($1.5m) will escape taxation. Even if dead millionaires were good candidates for tax breaks—doubtful, especially given fiscal pressures—there is no good economic reason to privilege houses over other assets. Indeed, the policy will encourage the well-off to buy bigger homes. In a country facing a severe housing shortage, that is irresponsible."
Quoted from that well-known socialist and envy-promoting paper, The Economist
". In perhaps the daftest economic policy of the decade, inheritance tax was cut—but only on houses. A new allowance for homes means that estates worth up to £1m ($1.5m) will escape taxation. Even if dead millionaires were good candidates for tax breaks—doubtful, especially given fiscal pressures—there is no good economic reason to privilege houses over other assets. Indeed, the policy will encourage the well-off to buy bigger homes. In a country facing a severe housing shortage, that is irresponsible."
Quoted from that well-known socialist and envy-promoting paper, The Economist
It is odd - but it's even odder if you read the actual budget document.
First, and I quote, To ensure that the wealthiest estates continue to make a greater contribution to inheritance tax receipts, there will be a tapered withdrawal of the main residence nil-rate band for estates with a net value of more than £2 million. So, the really wealthy will benefit much less than the moderately wealthy.
Second, the £1mn exemption is made up of two bits: up to £650,000 for any assets passed to any individual on death and gifts in the 7 years before death. And up to £350,000 when a main residence is passed on death to a direct descendant
So, it seems The Economist has either just read the obfuscation in the press releases rather than the actual detail or, more worryingly, they don't understand it!
So - if I've understood that correctly, as I'd initially assumed from the pre-budget leaks, there's no point in switching your assets to a more valuable main residence as only one worth £350k or less benefits to any great extent (and then only if it's a couple's house and then only if they are bequeathing the house to children or grandchildren).
Edited to add: I find the English odd too. Why the use of the phrase a main residence rather than the main residence? Will you be able to nominate which residence is your main one?
". In perhaps the daftest economic policy of the decade, inheritance tax was cut—but only on houses. A new allowance for homes means that estates worth up to £1m ($1.5m) will escape taxation. Even if dead millionaires were good candidates for tax breaks—doubtful, especially given fiscal pressures—there is no good economic reason to privilege houses over other assets. Indeed, the policy will encourage the well-off to buy bigger homes. In a country facing a severe housing shortage, that is irresponsible."
Quoted from that well-known socialist and envy-promoting paper, The Economist
It is odd - but it's even odder if you read the actual budget document.
First, and I quote, To ensure that the wealthiest estates continue to make a greater contribution to inheritance tax receipts, there will be a tapered withdrawal of the main residence nil-rate band for estates with a net value of more than £2 million. So, the really wealthy will benefit much less than the moderately wealthy.
Second, the £1mn exemption is made up of two bits: up to £650,000 for any assets passed to any individual on death and gifts in the 7 years before death. And up to £350,000 when a main residence is passed on death to a direct descendant
So, it seems The Economist has either just read the obfuscation in the press releases rather than the actual detail or, more worryingly, they don't understand it!
So - if I've understood that correctly, as I'd initially assumed from the pre-budget leaks, there's no point in switching your assets to a more valuable main residence as only one worth £350k or less benefits to any great extent (and then only if it's a couple's house and then only if they are bequeathing the house to children or grandchildren).
Edited to add: I find the English odd too. Why the use of the phrase a main residence rather than the main residence? Will you be able to nominate which residence is your main one?
No, the house can be worth up to £1m. There's £650k from the 'any assets' bucket, plus an additional £350k if a house. So as things stand if you have a house worth £1m, you are better off sitting in it, rather than downsizing and having some cash
The Economist's article does not seem to take into account WHY the change has been made. Generally speaking, those who are cash and asset wealthy are smart enough to avoid IHT or at least smart enough and rich enough to avoid it. The burden of IHT falls disproportionately on the following types of people (if their main residence is the asset that pushes them into IHT territory):
- cash-poor people who bought a modest home decades ago in an area that has become 'gentrified' by yuppies, commuters, millionaires and overseas speculators, causing the price of their house to skyrocket but for personal reasons they do not wish to leave the area to release that equity.
- people who die a sudden, unexpected death (road accident, murder, industrial accident, killed in combat etc.) without having made the necessary arrangements to ensure their estate was in order so that they could minimise the impact of IHT on what they would have liked to have passed onto their loved ones
So basically the only people who will be affected by this change in IHT are victims of market forces outside their control or victims of unexpected death. Everyone else who would be liable would already be doing their best to avoid the tax.
You also have to bear in mind a house doesn't actually cost that much to build in most cases (ignoring amenities such as tennis courts, swimming pools etc.). A 5-bed house could be built for under 200K nowadays. The actual value of property is the land/area/post code. The existing issue with including the main residence for IHT purposes has led to property that has increased in value passing from poor bereaved families to rich speculators or millionaire or buy-to-let barons. You would have thought the Tories were on the side of the latter rather than the former.
Calling it the daftest economic policy of the decade is a rather stupid line. They forget Brown was in office as both Chancellor and PM for 5 of the last 10 years and he was certainly behind much barmier policies during those years.
The Economist's article does not seem to take into account WHY the change has been made. Generally speaking, those who are cash and asset wealthy are smart enough to avoid IHT or at least smart enough and rich enough to avoid it. The burden of IHT falls disproportionately on the following types of people (if their main residence is the asset that pushes them into IHT territory):
- cash-poor people who bought a modest home decades ago in an area that has become 'gentrified' by yuppies, commuters, millionaires and overseas speculators, causing the price of their house to skyrocket but for personal reasons they do not wish to leave the area to release that equity.
- people who die a sudden, unexpected death (road accident, murder, industrial accident, killed in combat etc.) without having made the necessary arrangements to ensure their estate was in order so that they could minimise the impact of IHT on what they would have liked to have passed onto their loved ones
So basically the only people who will be affected by this change in IHT are victims of market forces outside their control or victims of unexpected death. Everyone else who would be liable would already be doing their best to avoid the tax.
You also have to bear in mind a house doesn't actually cost that much to build in most cases (ignoring amenities such as tennis courts, swimming pools etc.). A 5-bed house could be built for under 200K nowadays. The actual value of property is the land/area/post code. The existing issue with including the main residence for IHT purposes has led to property that has increased in value passing from poor bereaved families to rich speculators or millionaire or buy-to-let barons. You would have thought the Tories were on the side of the latter rather than the former.
Calling it the daftest economic policy of the decade is a rather stupid line. They forget Brown was in office as both Chancellor and PM for 5 of the last 10 years and he was certainly behind much barmier policies during those years.
It's the cash-poor sitting on a big house that is precisely why tilting the allowances towards property is wrong. Under the new rules an elderly single person or couple sitting in a 4-bed house has extra incentive to stay there, and not downsize - and i can name several houses in my street where that is the case. If you think we already have enough 3/4 bed houses in SE England, well it's no problem is it?
In fact, let me give you a very real example - my next-door neighbours. Missus is in her 80s, getting more frail, hubbie is 90 or so, and basically house bound. It's their prerogative to stay where they are of course, but at some point a move to a really nice retirement apartment - in the same are and nearer to shops etc - might be a good idea. But unless i'm missing a trick, the new rules will penalise them. Current house - say £900k. New apartment say £500k, leaving £400k cash. Net result is more IHT.
(forget stuff about trusts etc for now, let's keep it straightforward and assume that neither may be lucky & live another 7 years)
So they have good reason to stay put for as long as possible. And if for some reason they HAVE to move (care home, etc.) they are penalised. Why?
The Economist's article does not seem to take into account WHY the change has been made. Generally speaking, those who are cash and asset wealthy are smart enough to avoid IHT or at least smart enough and rich enough to avoid it. The burden of IHT falls disproportionately on the following types of people (if their main residence is the asset that pushes them into IHT territory):
- cash-poor people who bought a modest home decades ago in an area that has become 'gentrified' by yuppies, commuters, millionaires and overseas speculators, causing the price of their house to skyrocket but for personal reasons they do not wish to leave the area to release that equity.
- people who die a sudden, unexpected death (road accident, murder, industrial accident, killed in combat etc.) without having made the necessary arrangements to ensure their estate was in order so that they could minimise the impact of IHT on what they would have liked to have passed onto their loved ones
So basically the only people who will be affected by this change in IHT are victims of market forces outside their control or victims of unexpected death. Everyone else who would be liable would already be doing their best to avoid the tax.
You also have to bear in mind a house doesn't actually cost that much to build in most cases (ignoring amenities such as tennis courts, swimming pools etc.). A 5-bed house could be built for under 200K nowadays. The actual value of property is the land/area/post code. The existing issue with including the main residence for IHT purposes has led to property that has increased in value passing from poor bereaved families to rich speculators or millionaire or buy-to-let barons. You would have thought the Tories were on the side of the latter rather than the former.
Calling it the daftest economic policy of the decade is a rather stupid line. They forget Brown was in office as both Chancellor and PM for 5 of the last 10 years and he was certainly behind much barmier policies during those years.
It's the cash-poor sitting on a big house that is precisely why tilting the allowances towards property is wrong. Under the new rules an elderly single person or couple sitting in a 4-bed house has extra incentive to stay there, and not downsize - and i can name several houses in my street where that is the case. If you think we already have enough 3/4 bed houses in SE England, well it's no problem is it?
Believe me, elderly people do not particularly care about their money after they die. Yes they want to pass as much onto their loved ones as possible but I doubt many will continue to stay in a property that's too big for them if they're too frail to maintain it and there is no evidence that this will be a problem as a result of this change. Besides, as I mentioned before, if the elderly couple does downsize, it's more likely a rich person or family that don't need a house that size will buy it than a family that needs it.
The Economist's article does not seem to take into account WHY the change has been made. Generally speaking, those who are cash and asset wealthy are smart enough to avoid IHT or at least smart enough and rich enough to avoid it. The burden of IHT falls disproportionately on the following types of people (if their main residence is the asset that pushes them into IHT territory):
- cash-poor people who bought a modest home decades ago in an area that has become 'gentrified' by yuppies, commuters, millionaires and overseas speculators, causing the price of their house to skyrocket but for personal reasons they do not wish to leave the area to release that equity.
- people who die a sudden, unexpected death (road accident, murder, industrial accident, killed in combat etc.) without having made the necessary arrangements to ensure their estate was in order so that they could minimise the impact of IHT on what they would have liked to have passed onto their loved ones
So basically the only people who will be affected by this change in IHT are victims of market forces outside their control or victims of unexpected death. Everyone else who would be liable would already be doing their best to avoid the tax.
You also have to bear in mind a house doesn't actually cost that much to build in most cases (ignoring amenities such as tennis courts, swimming pools etc.). A 5-bed house could be built for under 200K nowadays. The actual value of property is the land/area/post code. The existing issue with including the main residence for IHT purposes has led to property that has increased in value passing from poor bereaved families to rich speculators or millionaire or buy-to-let barons. You would have thought the Tories were on the side of the latter rather than the former.
Calling it the daftest economic policy of the decade is a rather stupid line. They forget Brown was in office as both Chancellor and PM for 5 of the last 10 years and he was certainly behind much barmier policies during those years.
It's the cash-poor sitting on a big house that is precisely why tilting the allowances towards property is wrong. Under the new rules an elderly single person or couple sitting in a 4-bed house has extra incentive to stay there, and not downsize - and i can name several houses in my street where that is the case. If you think we already have enough 3/4 bed houses in SE England, well it's no problem is it?
Believe me, elderly people do not particularly care about their money after they die. Yes they want to pass as much onto their loved ones as possible but I doubt many will continue to stay in a property that's too big for them if they're too frail to maintain it and there is no evidence that this will be a problem as a result of this change. Besides, as I mentioned before, if the elderly couple does downsize, it's more likely a rich person or family that don't need a house that size will buy it than a family that needs it.
There's plenty of evidence that we have a housing shortage, so any change in policy that favours housing over other assets surely can't be a good idea. If you don't like IHT at all, well then scrap it, or allow £1m inheritance regardless of whether it is cash, houses or football programmes.
But we (i.e. me & The Economist versus your good self) will have to agree to differ on this I think. As you will probably gather from this, I stand to benefit from this change, so my misgivings about it certainly aren't related to that.
The Economist's article does not seem to take into account WHY the change has been made. Generally speaking, those who are cash and asset wealthy are smart enough to avoid IHT or at least smart enough and rich enough to avoid it. The burden of IHT falls disproportionately on the following types of people (if their main residence is the asset that pushes them into IHT territory):
- cash-poor people who bought a modest home decades ago in an area that has become 'gentrified' by yuppies, commuters, millionaires and overseas speculators, causing the price of their house to skyrocket but for personal reasons they do not wish to leave the area to release that equity.
- people who die a sudden, unexpected death (road accident, murder, industrial accident, killed in combat etc.) without having made the necessary arrangements to ensure their estate was in order so that they could minimise the impact of IHT on what they would have liked to have passed onto their loved ones
So basically the only people who will be affected by this change in IHT are victims of market forces outside their control or victims of unexpected death. Everyone else who would be liable would already be doing their best to avoid the tax.
You also have to bear in mind a house doesn't actually cost that much to build in most cases (ignoring amenities such as tennis courts, swimming pools etc.). A 5-bed house could be built for under 200K nowadays. The actual value of property is the land/area/post code. The existing issue with including the main residence for IHT purposes has led to property that has increased in value passing from poor bereaved families to rich speculators or millionaire or buy-to-let barons. You would have thought the Tories were on the side of the latter rather than the former.
Calling it the daftest economic policy of the decade is a rather stupid line. They forget Brown was in office as both Chancellor and PM for 5 of the last 10 years and he was certainly behind much barmier policies during those years.
It's the cash-poor sitting on a big house that is precisely why tilting the allowances towards property is wrong. Under the new rules an elderly single person or couple sitting in a 4-bed house has extra incentive to stay there, and not downsize - and i can name several houses in my street where that is the case. If you think we already have enough 3/4 bed houses in SE England, well it's no problem is it?
Believe me, elderly people do not particularly care about their money after they die. Yes they want to pass as much onto their loved ones as possible but I doubt many will continue to stay in a property that's too big for them if they're too frail to maintain it and there is no evidence that this will be a problem as a result of this change. Besides, as I mentioned before, if the elderly couple does downsize, it's more likely a rich person or family that don't need a house that size will buy it than a family that needs it.
You're just making anything up now Fiish. Btw, I'm not joining the debate.
But we (i.e. me & The Economist versus your good self) will have to agree to differ on this I think. As you will probably gather from this, I stand to benefit from this change, so my misgivings about it certainly aren't related to that.
Actually it's you and one contributor to the Economist. If you read the Economist on a regular basis you would know that
A. different contributors will often post contrary opinions/arguments
B. Economist contributors are fallible
Also, someone who calls this change in IHT the 'daftest economic policy of the decade' instantly loses any credibility, both Tory and Labour have done much worse in the last 10 years.
Covered End - you're wrong, quite simply. There's not really much more I can add to that. I'm not the one making up an imaginary crisis where 90-100 year olds are squatting in massive houses to avoid a posthumous financial inconvenience.
Comments
Quote:
The new prime minister, Clement Attlee, announced he would introduce the welfare state outlined in the 1942 Beveridge Report. This included the establishment of a National Health Service in 1948 with free medical treatment for all. A national system of benefits was also introduced to provide 'social security' so that the population would be protected from the 'cradle to the grave'.
Incidentally my original post actually referred to all sickness not just the sickness of old age.
My view let me reiterate is that treatment for all illness should be free with no weaselling around with different categories of care to justify extorting money from the sick. If the care is needed because of the detrimental effects of the illness it is health care.
However Red In SE8 has expressed a view that elderly property owners should pay for NHS treatment if I've understood him correctly. If I was going to charge for NHS treatment, which I reiterate I do not believe in, then the people who should be charged are those who have some choice as to using NHS facitilities rather than dementia patients. For example I read somewhere (no time to search it out just now) that at least 50% of A&E visits are 'avoidable' and are attributable directly or indirectly to alcohol or drug abuse be it damage to the individual or the mind altering effects making that individual damage others.
If I was going down the charging route then these are the people I would charge as those charges may act as a deterrent and relieve overburdened A&E departments of avoidable, unnecessary work thus improving the treatment and survival possibilities of the genuinely ill.
I would also ruthlessly attack the gross inefficencies that exist on the 'non clinical' side of the NHS. Labour's flagship PFI Scheme which swallows money, the rigged procurement market which means that medical supplies and drugs cost far more than necessary and the money pit useless IT development rife throughout the NHS to name but three.
However this is a subject for another thread and I am straying too far from inheritance tax and its modern incarnation social care.
Give it another 20 years we will probably be paying more for services of NHS a lot more. Or at least those of us lucky enough to have assets will.
Probably will allow euthanasia in a few years time, then we will all be able to pass on our money to our children and not to some owner of so called care home.
How long the NHS can stick to that historic pledge is another matter. But there should be transparency and fairness in making changes, not changes through the back door that pretend the NHS is still what it was designed to be.
Not that I agree that old people who aren't penniless should be forced to pay for healthcare. I don't think people should be forced to pay for healthcare just because it's a disease/illness only/mostly old people get. Why not make old people, who are easier for criminals to target, be made to pay for their own police as well? They're going to be dead soon anyway, right so they don't need their money?
Quoted from that well-known socialist and envy-promoting paper, The Economist
First, and I quote, To ensure that the wealthiest estates continue to make a greater contribution to inheritance tax receipts, there will be a tapered withdrawal of the main residence nil-rate band for estates with a net value of more than £2 million. So, the really wealthy will benefit much less than the moderately wealthy.
Second, the £1mn exemption is made up of two bits: up to £650,000 for any assets passed to any individual on death and gifts in the 7 years before death. And up to £350,000 when a main residence is passed on death to a direct descendant
So, it seems The Economist has either just read the obfuscation in the press releases rather than the actual detail or, more worryingly, they don't understand it!
So - if I've understood that correctly, as I'd initially assumed from the pre-budget leaks, there's no point in switching your assets to a more valuable main residence as only one worth £350k or less benefits to any great extent (and then only if it's a couple's house and then only if they are bequeathing the house to children or grandchildren).
Edited to add: I find the English odd too. Why the use of the phrase a main residence rather than the main residence? Will you be able to nominate which residence is your main one?
- cash-poor people who bought a modest home decades ago in an area that has become 'gentrified' by yuppies, commuters, millionaires and overseas speculators, causing the price of their house to skyrocket but for personal reasons they do not wish to leave the area to release that equity.
- people who die a sudden, unexpected death (road accident, murder, industrial accident, killed in combat etc.) without having made the necessary arrangements to ensure their estate was in order so that they could minimise the impact of IHT on what they would have liked to have passed onto their loved ones
So basically the only people who will be affected by this change in IHT are victims of market forces outside their control or victims of unexpected death. Everyone else who would be liable would already be doing their best to avoid the tax.
You also have to bear in mind a house doesn't actually cost that much to build in most cases (ignoring amenities such as tennis courts, swimming pools etc.). A 5-bed house could be built for under 200K nowadays. The actual value of property is the land/area/post code. The existing issue with including the main residence for IHT purposes has led to property that has increased in value passing from poor bereaved families to rich speculators or millionaire or buy-to-let barons. You would have thought the Tories were on the side of the latter rather than the former.
Calling it the daftest economic policy of the decade is a rather stupid line. They forget Brown was in office as both Chancellor and PM for 5 of the last 10 years and he was certainly behind much barmier policies during those years.
(forget stuff about trusts etc for now, let's keep it straightforward and assume that neither may be lucky & live another 7 years)
So they have good reason to stay put for as long as possible. And if for some reason they HAVE to move (care home, etc.) they are penalised. Why?
But we (i.e. me & The Economist versus your good self) will have to agree to differ on this I think. As you will probably gather from this, I stand to benefit from this change, so my misgivings about it certainly aren't related to that.
A. different contributors will often post contrary opinions/arguments
B. Economist contributors are fallible
Also, someone who calls this change in IHT the 'daftest economic policy of the decade' instantly loses any credibility, both Tory and Labour have done much worse in the last 10 years.
Covered End - you're wrong, quite simply. There's not really much more I can add to that. I'm not the one making up an imaginary crisis where 90-100 year olds are squatting in massive houses to avoid a posthumous financial inconvenience.