by Lordo » Sun Sep 24, 2023 11:56 am
Interesting call this morning on London Bullshit Corporation presented by the stupidest presenter in the world Andrew Castle.
He believes people pay tax twice if their children pay inheritance tax. Which is simply not true.
Lets take an example. A person bought a house 40 years ago for 20,000 pounds. By the time the house is paid for that person must have paid 50,000 pounds. So, this individual was taxed at about 30% tax and insurance for the money paid. So, move on 40 years on, this house is now worth a million pounds. The house has gained in value of some 950,000 over that period. It is this gain that is being taxed. But before it is taxed the original value is taken out first. Then there is the Inheritance tax allowance of 350,000 pounds so in fact the 40% tax charged is for 600,000 gained over the period.
In UK, there is a facility for an individual to transfer their wealth to their children 7 years before their death so the children do not need to pay any tax. This 7 year rule only applies to the property one lives in if they vacate it after transfer or pay their children the going rate of rent for the house. Now this is the one that catches most people as they have nowhere else to go and once they retire there is no way of paying the rent so they are trapped, they have no other choice other than wait till death and let the children pay tax.
The Swine have been in government for 13 years, and yet they have not once increased the ITA whilst the houses have probably trebled in that time. But it is funny how looming election concentrates the Swine brain cells and they start talking about lowering inheritance tax.
Of course the Swine themselves can afford to employ lawyers to set up schemes to avoid this tax or give most of their wealth to their children without paying a penny in tax.
Go figure.