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I dont get. Parents generally dont charge their kids rent. Add to that that your parents have just gifted you a house... Why would you charge them market rates?
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I dont get. Parents generally dont charge their kids rent. Add to that that your parents have just gifted you a house... Why would you charge them market rates?
Caporegime
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South east.
Of course but how is that relevant to the current discussion?
Not only that but councils have the power to trace back assets for many years previously and charge for care based on the disposed assets.
I'm very surprised that theres been very little talk about this as this is one of my main concerns also.
Damn! Look at Jim Sillars. Its strange recognising all these people back then.
If you don't pay market rental the gift is treated as one with reservation of benefits. For IHT purposes it effectively gets treated as if you never actually gave away the house. See here for a short and basic explanation:
https://www.gov.uk/inheritance-tax/passing-on-home
Edit: oh, and if the solution to a tax problem was this simple there wouldn't be a profession dedicated to assisting taxpayers navigate the world of taxation.
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That's still millions of people - and besides, that doesn't cover people who earn large dividends - that will cover PAYE for sure. There are a lot more actual high earners out there rather than middle earners in the 30-80k mark.
Look, I don't mind paying tax. I really don't. It's fair - but... it's the constant targeting of those earning over an arbitrary value which is supposedly "high" - that number keeps coming down.
£20 a week worse off - no that doesn't bother me. That said, I have no trust in the government or the NHS' capability of utilising this extra money sensibly. So that's why I resent it slightly.
Also, consider that what some people who are earning this supposed large 80k+ salary some may be single income families - paying a mortgage, bills, food, kids, transport (either public or private) and all the other bits and pieces - that 'huge' amount of money suddenly disappears quickly. Sure you'll probably okay and keep the family going - but you're not necessarily going to be "well off" or have potentially much disposable income. Or, if you're renting and wanting to save for a deposit, but still have the kids, and the single income, and living in/around London (typically associated with high earners) that 'huge' salary is actually not all that 'huge'. That salary if it becomes taxed more will become less over all than 2 incomes @ 40k.
Now if we were having a chat about people earning £1m+ a year with 50% bonuses etc... then I'd argue you'd be onto something.
However, thinking about it dispassionately 80k household income depending on your circumstances is not always as peachy as some make it out to be. Now of course you should be able to manage, and requires some sacrifices and a little bit of financial planning/being sensible, with that sort of household income. But it's not as if you will be driving a Ferrari, wear Gucci clothes, and have a pool and half a dozen foreign holidays a year!
because if you don't then you're rather obviously disposing of an asset which you still want to make use of... seriously do you not think this would be an obvious loop hole otherwise? Just transfer your house to your kid's names and carry on living there
One thing I don't understand about the Tory's death tax to pay for care:
Scenario: Husband, wife, 2 kids (say 2 year old and 4 year old) living in house wholey owned (no mortgage). Husband or wife gets degenerative illness and needs 10 years of expensive care and then dies, leaving the other and a 12 and 14 year old. Do the care costs then come out of the deceased's equity share in the house, potentially forcing the sale of the house and leaving three people homeless?
Scenario: Husband, wife, 2 kids (say 2 year old and 4 year old) living in house wholey owned (no mortgage). Husband or wife gets degenerative illness and needs 10 years of expensive care and then dies, leaving the other and a 12 and 14 year old. Do the care costs then come out of the deceased's equity share in the house, potentially forcing the sale of the house and leaving three people homeless?
Pretty sure I saw that on some old age analysis site that women now require some form of help for 11 years and men 6 years on average. Now obviously a lot of people get this assistance from their partners and family so dont need "at home" care or in carehomes but that does imply that potentially, somebody with no family to look after them (or close enough) will require some form of social care for up to 11 years on average. So with that costing £11k per year for at home and then later at £30k per annum for in a nursing home I can some individuals will be paying back hundreds of thousands.
Also the amount of people receiving care either at home or in nursing home is 1m atm and set to rise to 3m over the next fews years. If they only needed this care for a short time before dying like dowie claims then I would have thought more people would be dying per annum? There was only 529k deaths in the UK in 2015 and that is off all ages. Even if that was all the people in care that would still be 2 to 6 years needing care.
The mortality rate for the over 85s is 129 for men and 102 for women and even for the over 90s its only 244 and 219. So thats a lot of years of average the very old are living for,
No, it doesn't come out until the partner dies which is at least something. Although what happens if that surviving partner wants to move house or get a mortgage on it, I have no idea.
Also unknown is whether this figure continues to grow or is fixed at point of death.
Also the amount of people receiving care either at home or in nursing home is 1m atm and set to rise to 3m over the next fews years. If they only needed this care for a short time before dying like dowie claims then I would have thought more people would be dying per annum? There was only 529k deaths in the UK in 2015 and that is off all ages. Even if that was all the people in care that would still be 2 to 6 years needing care.
The mortality rate for the over 85s is 129 for men and 102 for women and even for the over 90s its only 244 and 219. So thats a lot of years of average the very old are living for,
No, it doesn't come out until the partner dies which is at least something. Although what happens if that surviving partner wants to move house or get a mortgage on it, I have no idea.
Also unknown is whether this figure continues to grow or is fixed at point of death.
That is why all manifesto pledges by any party are only as good as the detailed legislation that follows them. Unless you create an Edstone
how was your comment relevant to this election then?
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Yes, the Torys have admitted they are going to bend homeowners and pensioners over, but you have to vote for them before they tell you whether they are going to use lube or not.That is why all manifesto pledges by any party are only as good as the detailed legislation that follows them. Unless you create an Edstone
They've said that they won't force a sale until you and your spouse are deceased.
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Rofl... Quote of the day
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What happens if you want to move, or remortgage?
Wonder how long before someone figures out the big problem with this system and how people are going to offset it and the knock on problem it will cause :s
It's a secret (or, they haven't made that bit up yet...)
You gonna be moving when you need home care? Move to Timbuktu or something
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