Millennials are likely to enjoy the biggest "inheritance boom"

Tunney · 2 Jan 2018 at 10:28

Dolph said:
Nothing says progress like state seizure of property.

… from dead multimillionaires.

If we want a meritocratic society, we need to reward those who are currently productive rather than those whose ancestors have been productive.

Dolph · 2 Jan 2018 at 10:31

Tunney said:
… from dead multimillionaires.

If we want a meritocratic society, we need to reward those who are currently productive rather than those whose ancestors have been productive.

So how are you going to stop the assets moving before death?

Tunney · 2 Jan 2018 at 11:45

Dolph said:
So how are you going to stop the assets moving before death?

Tax gifts and second properties appropriately.

Dolph · 2 Jan 2018 at 11:47

Tunney said:
Tax gifts and second properties appropriately.

So not just from the dead then, just across the board tax increases...

balky12 · 2 Jan 2018 at 12:09

Tunney said:
I say tax the first million at zero and then anything above that at a hundred percent. Leaving a million pounds to your descendants should be enough for anyone.

My parents house is worth more than a million. They are hardly millionaires though.

I would therefore have to sell the house to pay the taxman...

A house that was taxed upon purchase and then paid for by money which was taxed.

Tax tax tax tax tax

Tunney · 2 Jan 2018 at 12:29

Dolph said:
So not just from the dead then, just across the board tax increases...

Depends on when the tax was levied. We already have the seven-year rule.

balky12 said:
My parents house is worth more than a million. They are hardly millionaires though.

If they own the house outright, they are millionaires whether they feel like millionaires or not.

I would therefore have to sell the house to pay the taxman...

You’d still have a guaranteed million pounds left after the sale.

The current threadhold for leaving property to your children is £425,000 and anything above that is taxed at 40%. If your parents’ house is worth over a million, you’re likely going to need to sell it.

balky12 · 2 Jan 2018 at 12:45

Tunney said:
If they own the house outright, they are millionaires whether they feel like millionaires or not.

You’d still have a guaranteed million pounds left after the sale.

The current threadhold for leaving property to your children is £425,000 and anything above that is taxed at 40%. If your parents’ house is worth over a million, you’re likely going to need to sell it.

Being a millionaire and having a house worth more than a million (Especially in a South East, are two totally different things imo. But semantics.

That can be doubled up though to £850,000. Meaning I would only need to pay 40% on what's above that. Plus the threshold is increasing to a possible £1m by 2020? Which is even better.

dowie · 2 Jan 2018 at 12:48

Dis86 said:
But why? Tax has already been paid on that. Several times over in many cases!

that's how tax works... if you work in a shop say the people buying things have paid tax on their income... they'll pay tax on the products they buy, the ship will pay tax on its profits (if a LTD company) and you'll pay tax on your income... you could pull out that same line there - but pointing out that the customers have already paid some tax on their income and then again on the stuff they bought isn't a good argument against you still having to pay tax on your income...

Mr Badger · 2 Jan 2018 at 12:52

balky12 said:
Tax tax tax tax tax

Makes the world go round.

dl8860 · 2 Jan 2018 at 12:54

balky12 said:
Being a millionaire and having a house worth more than a million (Especially in a South East, are two totally different things imo. But semantics.

OK but if you had a million quid in the bank and wanted to live in that area and didn't own a home.... you'd probably go and buy a similar house. Being a millionaire doesn't mean having 7 figures in the bank to spend willy nilly on top of all your other assets. It's not semantics, it's the meaning of the word.

Scam · 2 Jan 2018 at 13:08

If you own a £1m house outright (no mortgage) then you are a millionaire. Just goes to show how much we've normalised these ridiculous house prices that people in the SE would argue they're not "well off" when they could sell-up and rent somewhere -- with £1m in the bank! The girlfriend and I walk past £1m houses in our street with pensioners sitting in their front room thinking "jeez, how the other half live". Pensioners sitting on £1m with no mortgage to pay whilst we pay a not-insignificant proportion of our salaries to live in a 2 bed flat in the same road...

*Of course, people paying off a big mortgage on a £1m mortgage are not necessarily well-off as far as disposable income goes, but they are still rich in capital because they will have that £1m paid off.. eventually.

EDIT: It's this type of **** that really makes me see red. Stupid BBC giving them free publicity like they've done something all hippy-happy and wonderful whereas in reality they're the biggest capitalist whores going. You say "passive income stream" I say, well.. I can't say on these forums! http://www.bbc.co.uk/news/av/uk-england-42423615/early-retirement-our-road-to-financial-independence

balky12 · 2 Jan 2018 at 15:50

Never did I say my parents weren't 'well-off' and yes maybe I could have argued the whole millionaire point differently. Yes technically they are millionaires...

However when one imagines a millionaires lifestyle it's more than likely a hell of a lot different to my mum and dads

I imagine there are quite a lot of millionaires especially in the south east and London once you add up all their assets/ pensions/ etc.

Wouldn't surprise me if a lot of these millionaires live month by month when it comes to finances either.

dowie · 2 Jan 2018 at 15:55

Scam said:
EDIT: It's this type of **** that really makes me see red. Stupid BBC giving them free publicity like they've done something all hippy-happy and wonderful whereas in reality they're the biggest capitalist whores going. You say "passive income stream" I say, well.. I can't say on these forums! http://www.bbc.co.uk/news/av/uk-england-42423615/early-retirement-our-road-to-financial-independence

LOL I guess this Daily Mash story is relevant here:

*** warning mild swear word in the link below ***

https://tinyurl.com/y8kykp8l

A COUPLE who moved from London to Bristol are talking as if they’ve done something extremely brave.

Illustrator Mary Fisher and vague internet job worker Tom Booker moved to Bristol because they wanted to buy a relatively cheap house, but keep banging on about their ‘old lives’ in London.

Fisher said: “We were out every night in London at cutting-edge art galleries, restaurants you wouldn’t have heard of and plays where they make you dress up as a soldier. It was pretty amazing, as you can imagine.”

Seemingly forgetting that Bristol is still a big city with loads of crackheads, she added: “In the end though we were prepared to sacrifice that for a quieter life, where we have an allotment and wear dungarees like it’s the war.”

Booker said: “Of course we’re very lucky that everyone can work remotely these days. Well, everyone like us. Not people with normal office jobs but there’s probably only 50 million or so of them.”

Fisher added: “Now that we’re here were want to make a positive impact, possibly by setting up the puppetry academy that this working class area so desperately craves.

“We’re not saying we deserve a medal but some kind of trophy might be good, if it was designed by Grayson Perry and was tasteful."

englishpremier · 2 Jan 2018 at 16:14

balky12 said:
My parents house is worth more than a million. They are hardly millionaires though.

I would therefore have to sell the house to pay the taxman...

A house that was taxed upon purchase and then paid for by money which was taxed.

Tax tax tax tax tax

Normally it goes on assets so yes they are actually millionaires.

When you see the Rich List in whatever publication, it's not like Gates or Slim or whoever has billions just sitting in a bank, its all done on assets.

But anyway, I suppose that is besides the point. Not sure where I stand on inheritance tax. It seems punitive in nature.

dl8860 · 2 Jan 2018 at 16:24

I think if you believe we should live in a meritocracy in any sense, then you should be in favour of some form of inheritance tax. Otherwise why should one child have such a tremendous start ahead of another.

Randomface74 · 2 Jan 2018 at 16:29

I believe in a meritocracy but NOT in inheritance tax.

The inherited wealth comes from the parents' merit - which was taxed when earned.

It's entirely rational to want to use your talents to not only provide for yourself but also for your children.

I might be convinced that a portion of inheritance should go in a LISA or something though... maybe.

Hotwired · 2 Jan 2018 at 16:31

englishpremier said:
Normally it goes on assets so yes they are actually millionaires.

When you see the Rich List in whatever publication, it's not like Gates or Slim or whoever has billions just sitting in a bank, its all done on assets.

But anyway, I suppose that is besides the point. Not sure where I stand on inheritance tax. It seems punitive in nature.

Reminds me of Alan Sugar talking about his estimated value and it bouncing up and down in the UK list.

He didn't think much of it, also noted that many in such lists had very little liquid cash, meanwhile he could write a check for 100m if he wanted to.

Asset rich is not what people think of but it's really the majority. You can walk down streets where every property is £1m+ and everyone is retired but it's unlikely they have anything near in cash since they most likely got that house through climbing the property ladder with a large amount of their salaries over the years. That plus property values increasing at the same time. End result, almost all their value is in their house.

Roar87 · 2 Jan 2018 at 16:57

I'm interested in how people's views on inheritance tax are shaped by what they will actually inherit themselves.

I'm torn on the issue, both sides have valid arguments, you can argue 100% or 0% tax with valid points on both sides. I'm ideologically a fan of low taxes and high personal responsibility, and I'm also a fan of a meritocracy, which seem to conflict on this issue. I feel my belief in a meritocracy is more than my belief in a low tax state though, people should earn their own money, children of rich parents have enough advantages in life that it seems borderline ridiculous that they should get a huge lump sum on top meaning they may never have to work again. I'd probably support something like 50% over £500k and 80% over £5m.

Hotwired · 2 Jan 2018 at 17:12

Roar87 said:
I'm interested in how people's views on inheritance tax are shaped by what they will actually inherit themselves.

My parents have no intentions of letting the taxman have anything more than the bare minimum. Much is already in childrens names.

Roar87 · 2 Jan 2018 at 18:03

Hotwired said:
My parents have no intentions of letting the taxman have anything more than the bare minimum. Much is already in childrens names.

So just tax avoidance then, fair enough, I assume you'll never complain about anyone not paying their taxes or the state of public services then.