10% Rule, am i missing something

[SaltyC]

I believe taper relief applies to any gift no matter what the value.

After all, if it didn't then you could give away multiple amounts of £324999 without incurring any IHT liability.

But yes, rocks everywhere - so best get advice from an expert and not somebody on the internet.

My explanation / understanding isn't good enough to explain. Only gifts Over £325000 count for taper relief before 7 years. Nit sure if all or only tge amount over the limit gets taper relief.
Easier sailing through a Ricky passage with mines in the channel.

 

[lustyd]

No, gifts over the allowance just mean the tax doesn’t come from the estate, it’s paid by the receiver of the gift.

 

[Sailing steve]

YouGov says only about 4% of people have to pay inheritance tax so probably academic for most of us.

The threshold for an individuals IHT liability hasn't changed from £325k since 2010.

With a significant increase in property values and a roughly 3000 point rise in the FTSE since then it'll become less and less academic for more and more people as time goes on.

 

[Egret]

Fair comment. I had been thinking of the married couple figure of £650,000 + £175000 possibly,

 

[lustyd]

The threshold for an individuals IHT liability hasn't changed from £325k since 2010.

With a significant increase in property values and a roughly 3000 point rise in the FTSE since then it'll become less and less academic for more and more people as time goes on.

IHT isn’t really a proper tax. Just like “supertax” it’s just a pantomime to convince the poor that the rich are being taxed. There are a few middle income folk that end up paying because they don’t know better but the rich don’t pay and the poor don’t pay. None of this is hard to avoid.

If you think the value of your property makes a difference then get some advice from a pro. Do you think BoJo paid IHT on the family properties?

 

[Bouba]

Does inherited wealth help anyone ?.....all in all I will say no....most recipients will just waste it (which is the best option), lose their incentive to work for themselves, or become financially successful but become entitled and unpleasant.
My advice....spend it !

 

[lustyd]

Does inherited wealth help anyone ?

Literally everyone in parliament.

 

[Sailing steve]

If you think the value of your property makes a difference then get some advice from a pro.

I have.

Yes it does.

 

[lustyd]

I have.

Yes it does.

Then the advice wasn't very good. With proper planning your house could be worth £200M and you wouldn't need to pay IHT. The reason very few people pay IHT is that it's a tax designed to be worked around because it's a tax written by wealthy people to protect wealthy people.

 

[Sailing steve]

Then the advice wasn't very good. With proper planning your house could be worth £200M and you wouldn't need to pay IHT. The reason very few people pay IHT is that it's a tax designed to be worked around because it's a tax written by wealthy people to protect wealthy people.

If you believe I've been badly advised then I'd appreciate being told why.

 

[lustyd]

Because you seem to be saying that people pay more IHT as their property value goes up and that’s not the case. Some of the most expensive properties in the country are placed in family trusts but there are many ways to avoid IHT if you plan properly, and these methods get simpler the more wealthy you get. Hence those 4% paying it are in the middle not at the top.

 

[Tranona]

Because you seem to be saying that people pay more IHT as their property value goes up and that’s not the case. Some of the most expensive properties in the country are placed in family trusts but there are many ways to avoid IHT if you plan properly, and these methods get simpler the more wealthy you get. Hence those 4% paying it are in the middle not at the top.

In practice though with people who are on the margins it is not easy to justify placing a house in trust for the reasons (and probably others) I suggested in post#74. If you are seriously wealthy, as you say it is easier to plan ahead (as many farmers will be now), but for many there are too many unknowns. Of course again as I explained earlier) who made plans based on the 2015 rule change on pensions now find themselves in a potential IHT position but without the time to make the necessary arrangements, nor perhaps the clear cut case to set up a trust.

 

[TiggerToo]

As seen today: "The annual cost of running a superyacht is typically 10% of the purchase price".

It seems the 10% rule is taken as taken as a valid guideline for other floaty things in addition to our manky auld hulks

Revealed: how Roman Abramovich dodged taxes on cost of running his fleet of superyachts

 

[Bouba]

Shock horror !!!
Superyachts are foreign flagged and owned by shell companies….who would have thought !