Inheritance Tax Question

Stuff

Stuff

Stuff

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Quick question... If you were to receive a gift of £10k and someone dies within the 7 year 'limit', is inheritance tax payable on that gift, even if it was received all those years ago?
 
Also taper relief would apply if the gift was over 3 years before the time of death which reduces the tax payable. I.e. if the gift was 6-7 years before the time of death, the IHT payable is reduced by 80%.
 
Ahh, death and taxes - the two most certain things in life.

OP - I think you can receive so many thousand pounds before the taxman takes a cut. Can't remember the exact amount but it is well over the £10,000 that you quoted.

Inheritance tax comes across as unfair in my opinion because they've earnt the money, paid tax on it already and then the money gets taxed again when you get it.
 
Strife212 said:
IHT must raise a paltry amount for all the grief and hassle it causes people. Should be abolished.
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In 2010-11 it was £2.9 billion, the same as the amount raised in spirits duties.

It's approximately the equivalent of a penny on the basic rate of Income Tax.

Edit:

In 2013-14 it was £3.4 billion, the same as the amount raised in beer duties.
 
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even ignoring taper relief there probably wouldn't be a huge amount of tax to pay on it... its 40% of the assets above 325k

so supposing their estate was worth 500k in total you're AFAIK going to be paying 14% tax on that assuming they died shortly after giving you the 10k
 
yup and its better to tax assets when they're transferred... I really don't like the idea of 'property taxes' they have in other countries while we do have council tax it doesn't vary too much in comparison between households. Assets should be taxed when you transfer ownership of them - i.e. stamp duty, IHT etc..
 
Strife212 said:
IHT must raise a paltry amount for all the grief and hassle it causes people. Should be abolished.
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It should indeed. There is absolutely no legitimate sense behind taxing money that was already taxed at the point of earning just because it's being passed on. Inheritance Tax is disgusting.

Stamp Duty is another that should go. Very little basis in it besides a quick governmental cash grab.
 
Pestilence said:
It should indeed. There is absolutely no legitimate sense behind taxing money that was already taxed at the point of earning just because it's being passed on. Inheritance Tax is disgusting.

Stamp Duty is another that should go. Very little basis in it besides a quick governmental cash grab.
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People have to be taxed some how, these particular taxes are actually quite good because it lets the population take a cut of money that's passed from Lord X and his 5000 acre estate rather than that family living of inheritance from hundreds of years ago.

In forces people to contribute rather than receive.

The only other good taxes are those based on consumption (VAT etc), use more pay more.

Income taxes however are bad as they don't reward working hard.
 
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Pestilence said:
There is absolutely no legitimate sense behind taxing money that was already taxed at the point of earning just because it's being passed on.
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Aparrt from preventing the concentration of wealth you mean................
 
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VAT is a regressive tax.

Income tax is fair people just need to come round to the idea paying more for good social welfare and services , child care, education, health etc is better than amassing wealth in its own right.
 
amigafan2003 said:
Aprart from preventing the concentration of wealth you mean................
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I'm not entirely certain that that's valid -- in my own opinion, of course.

"Old money" will always be around, but when people have worked hard to amass that fortune then what further claim should be had upon it? It was taxed in the beginning, so why should it be further chipped on as the years move on?

If I were mega-rich, through my own legitimate toils and tax paying, I'd like to think that the money is mine to do whatever I wish with. Even if that means passing it on when I die without further interference. That seems perfectly reasonable to me.

I'm interested in knowing your opinions on that.
 
Stuff said:
Quick question... If you were to receive a gift of £10k and someone dies within the 7 year 'limit', is inheritance tax payable on that gift, even if it was received all those years ago?
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Yes (if their estate is valuable enough), but the estate pays the tax, not you.
 
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