It broke my grandmothers heart to know that the care home she was in was costing £1300 a week, she was in there for 2 years. She wanted this to be her children's inheritance
No! Mucky as that sounds! I think you can set up a trust fund which remains out of reach of the Local Authority , and the money can be left to your beneficiaries, who will top up any fees in the event that the state accommodation is ...er...full ofexcrement to use your description!!@@Petrolhead912
In the 1990s I sold pensions on the strenght that the tax free lump sum would pay off most if not all of the mortgage and leave the investor with a pension for life. Most were over a 40 year term plus, I was not alone.
The approach of selling pensions with the promise that a tax-free lump sum would pay off mortgages and provide a lifelong pension was common in the 1990s. However, many factors can affect the outcome, including changes in the housing market and interest rates. It's crucial for investors to seek personalized advice and consider diversified financial strategies to ensure long-term financial stability.
it's vital for investors to seek personalized advice and adopt diversified financial strategies. Working with a knowledgeable financial adviser is crucial for achieving long-term financial stability and freedom
I've experimented with a few over the past years, but I've stuck with ‘’Nicole Anastasia Plumlee” for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look her up.
Small taxes can affect investment decisions such as whether to choose tax-free municipal bonds over taxable bonds or do a Roth IRA conversion. I’ve been sitting on over $745K equity from a home sale and I want to invest on the stock market, how do I achieve this without being taxed twice?
There’s more benefit to holding fixed-income assets in tax-deferred retirement accounts as opposed to taxable accounts. If you're not who understands strategies to invest in the market, seek a Financial advisor to guide you.
Indeed, I did make use of a financial counselor. As I get closer to retirement, their advice has been really helpful. I thought compound interest on index funds wouldn't be sufficient because I started late. It's amusing how I've done better than colleagues who have more years of investment experience. I've profited more than $886k tax free.
Certainly, there are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’Sophia Maurine Lanting” for about five years now, and her performance has been consistently impressive.She’s quite known in her field, look-her up.
I feel investors should be focusing on under-the-radar stocks, and considering the current rollercoaster nature of the stock market, Because 35% of my $270k portfolio comprises of plummeting stocks which were once revered and i don't know where to go here out of devastation
Safest approach i feel to tackle it is to diversify investments. By spreading investments across different asset classes, like bonds, real estate, and international stocks, they can reduce the impact of a market meltdown
No doubt, having the right plan is invaluable, my portfolio is well-matched for every season of the market and recently hit 100% rise from early last year. I and my CFP are working on a 7 figure ballpark goal, tho this could take till Q3 2024.
I just googled her and I'm really impressed with her credentials; I reached out to her since I need all the assistance I can get. I just scheduled a caII.
Inheritance tax can be a source of confusion, with various myths surrounding who will pay it and how it truly works. Contrary to common belief, not everyone is subject to inheritance tax in every situation
Understanding the intricacies is crucial, as the tax depends on factors like the value of the estate, the relationship to the deceased, and available exemptions. Dispelling these myths is the first step in demystifying inheritance tax.
Having recently dealt with the complexities of inheritance tax, I can attest to the importance of professional guidance. It's not just about the financial aspect but understanding the nuances of tax laws. I engaged a certified advisor who not only clarified the intricacies but also helped optimize the financial implications, ensuring I paid only what was necessary.
Your experience echoes my concerns about potential inheritance tax. Could you share more about your advisor's approach and how they helped you navigate the intricacies of this tax?
The bigger concern is if you need care and own your home the council will take your home, you’ll have nothing to leave. This is what most pensioners like myself are concerned about.
@@shamir.globalimpact Think he means, if they're put into a care home, and they own a house, Government will use the value of the house to fund the stay at a care home, at apparently high rates. You only get help from the system, if you financially have nothing. That in itself controversial. One one hand, people who have nothing need help from Government, but if they contributed nothing or little into the system why are they getting too much help? Those who contributed to the system can't get access because they have their own finances, but at the same time, why shouldn't get access, when it's their taxes that prop up the system in the first place and now they need some help back.
@@shamir.globalimpactto fund your care you would have to sell your home and pay for care from the proceeds…the council don’t do this or take your home to do it…you or your family have to do this …but paying for your own care means you can find a care home you like where you like and some are splendid.
Such a brilliant video explaining simply.Been looking on internet & a little confused. the way things were worded.Martyn has summed it up so well.Thank you
Great video, I have a quick question. I am an aspiring trader, I am looking study some traders and earn off their expertise rather than investing myself and lose money emotionally. What's your take on copy trading? Do people really make money? Just looking for some reassurance.
Focus on long term investments in property, stocks, and bonds. Avoid copying, day trading and 'chart astrology'. Diversify across different geographies, industries, and value chain stages - to reduce your risk. You can do this with ETFs, or by selecting different stocks yourself. This is the best way to invest for more than 90% of people
How can I participate in this? I sincerely aspire to establish a secure financial future and am eager to participate. Who is the driving force behind your success?
Point 6. Whilst only 4% of households pay inheritance tax, many many more have to complete bonkers hrmc forms to prove no tax is due. If you ask a solicitor to do it for you it will cost around £10,000. If not you get to fill in around 80 pages across 13 forms. It is a bureaucrats wet dream and very time consuming.
I agree. It is just 'another' government endorsed hurdle and hmrc financial gain put in place of your 'rightful' inheritance that they have already charged tax on when it was 'originally' either earnt or purchased. And now they want more!.
Ive just had a free chat with advisor Clare Sutherland and she has answered all my questions, especially about lasting power of attorney, IHT, wills and if a trust fund would help. Trust funds can be very expensive. Everyone's situation is different so I think speaking to a professional has helped me understand how I can protect and make it more straight forward for my children to pick up the pieces if I lose capacity and when Ive gone.
The main problem I have with it is that the wealthiest almost entirely avoid it via complex financial vehicles/offshoring etc. Yes, only 4% of estates pay it today, but that number will go up substantially every year as house prices continue to rise and the tax thresholds are frozen. Taxing twice at 40%, even for affluent households, is imo too heavy a burden, but if you’re going to do it, at least make the very wealthiest pay it as well. Not to do so is a huge injustice.
Yes and in the case where a spinster aunt died leaving everything to her sister, who had died previous. With My brother and sister we inherited her estate, it came over the £325 K threshold so 40% IHT was charged which just left me asking why. Her earnings were taxed, her taxes money invested and profits taxed, taxes when property bought, and then they want a further piece of the action.
@@guyr7351 The tax is on you. You are looking to come into a sum of wealth that you didn't earn. Unearned income is still income. Unearned income is taxed below the level of earned income. Stop complaining. You received a bunch of cash you did not earn. Pay your tax and count yourself lucky. Luckier than most. Why should you be able to accumulate so much intergenerational wealth when to do so invariably disadvantages everyone else?
@@bakedbean37 one way to look at it, to me it is the state having another bite at the cherry. I’m not sure how it disadvantages other people though, the amount of tax raised is modest by the Governments income levels from other taxes, and as others have said those estates that are much higher valued systems and ways are found to pass the wealth down. I did use the money wisely and it was not money I had ever anticipated, but I had promised my mother when she was dying of Cancer I would make sure her sister was OK a promise I kept, being the only person who made the effort to see her in her final days, (covid was still having an impact) talking to her as she slipped away. I also made a payment to a cousin who I know my aunt wanted to give money to, the other beneficiaries wouldn’t make any payment. But hey ho it is what it is
@@bakedbean37 Because it was her aunt's money. Like it or not: family looks out for family. The tax has been paid. You, my friend, should not have a say.
@@Nora.........earn your own money don't rely on handouts. These rich scroungers are insufferable! Take the money and keep quite. Many people are struggling to feed themselves and their kids, they don't want hear about people complaining they missed out on 100K and only got 500k in inheritance.
People who never saved are better looked after as they can get pension credit and other benefits. People who worked all their lives and saved by being frugal are punished. My pension is very small and every month I have to dip into my meagre savings after working and paying taxes for 45 years. My pension is just over the threshold for claiming pension credit. I am single and there is no one to share the bills. No one knows how long they have got on this planet but my thinking now is enjoy life by spending your savings and if you live long enough without any savings left, then let the government / council take care of you. People with no savings or assets pay nothing for being in a home but others with some assets have to pay.
Maybe 96% of estates didn't pay Inheritance Tax, but that is because a lot of those have jumped through all the hoops in the preceeding years to ensure they didn't pay. It can easily creep up on you: a sadly widowed middle-aged person who thinks they've still no concerns about IHT can soon be thrown into problems if a parent leaves them their estate and it's worth a surprisingly large amount. £1m is not as much as it first seems once you factor in your own home AND an inherited home.
Private pensions can "sometimes" be included which I why, I suspect, Martin didn't stress this. If you have a flexible pension (like a SIPP) and reduce your drawings because you know that you are terminally ill, in a bid to pass on wealth, HMRC can charge the pension to IHT. In any event, if you die older than 75 and leave a pension fund to anyone (spouse, children or grandchildren) they pay income tax on what they take out of the inherited pot which could be 20%, 40% or 45% so could be more than IHT albeit the tax is on withdrawals whereas IHT is before it's passed on.
The biggest scandal around inheritance tax is HMRC demanding payment directly, but you can't pay untill Probate is granted which is in the hands of another branch of the burocracy that is even more dysfunctional than HMRC.
My Mother is going into a care home and the house she and my deceased Dad bought is to be sold off, her savings account emptied and used to pay for her £1200 per week care. £130,000 worth at the moment. Sadly, that's how it goes, the money my Mum and Dad created over 60 years is going to the nursing home manager. Someone has to pay for it! Looks like myself, my brother and sister are getting no inheritance at all. What a wonderful country. 😞😡
This is so difficult but the good thing the money your parents earned is taking care of your Mother in her old age,bless her. I hope she is happy and gets care of the highest standard as her money is paying for it, anything left will I am sure come to you all. I would be thankful she is being well looked after and you are all doing the right thing by your dear Mum. Bless you all.
I recently inherited almost $500k. I REALLY need to make this money work for me, and not just disappear over time. I've been scrambling for somewhere to put the money, where can make an effort to use the gains to pay bills so I can quit my job. All roads have pointed to the financial market of some sort which is a good idea buh where else should I put money besides the financial market? We have a 13% RPI rate so cash is tough.
Wow I know Samuel Peter Descovich. His platform maintains a unique perspective and is very transparent with their investors. Regardless of whether or not he outperforms i will always stay invested as his methods alone with keeping investors in touch with their strategies and outlooks are something that so few managers are capable of and they should follow suit
Yeah real, that guy is one asset manager that gives the breakdown of everything on how things are done, joining an effective financial community can be 100% beneficial when joined properly that's all I can say out of experience
I’m never likely to have enough for inheritance tax to be applied to my estate, but I still think it’s a despicable tax. We pay tax on everything all our lives, so why should stuff we’ve bought or money we’ve saved, that we’ve already paid tax on, be taxed again on our death. This was a tax originally aimed at the super rich, now to be honest it affects the moderately wealthy, it shouldn’t be applied to anyone, but if the government must steal money, maybe they could reign it in a bit & only charge 20%.
You have paid tax on the money in your estate and you are not going to pay again. However a person who has not worked or saved to create that money is going to be taxed if you give that money to them. Just like wages every time money is moved from one person to another it is taxed. Your employer gives you money you pay tax, you give money to the window cleaner, they pay tax. We all have to pay our own dues in life.
@@garyh1572 I always wondered about that phrase unearned.. I get it, your children didn’t earn the house or the tax paid wages that paid for it or the tax that the bank paid on the profits on the interest you paid. A son could be 60 when inheriting a family home and take a mortgage out to keep it after paying the tax on it… then use a part of his pension 5 years later to clear that loan. He could die a year later, 6 years after he paid the tax on the house and leave it to his daughter who then also has to take another mortgage on her tax bill.. it never ends and is a disgrace.. all because you’d like to keep your family home.
@@garyh1572the government certainly didn’t earn a penny of it so they are not entitled to 1 single red cent of it. They are nothing but legal mafia thieves. My children are my responsibility and what’s mine is theirs, they earned it through me and my efforts as a responsible parent who does not leave burdens on society as I built foundations for them to build on.
@@zionjzachary Yes, but when they receive the money ,it needs to be taxed like income. Less than 3% of the population pay it anyway. It won't affect you - stop defending very rich people.
One checkpoint as not sure 500k on residence is correct, it’s up to 500k as residence value is the tax free amount so if you left 500k in cash and residence was 100k tax free would be 425k the rest would be taxed still.
I'm the same as you, single divorced but house around £700K, the going rate for a modest family home in SE. When my son is ready to buy a house I will downsize to pass the extra £200K on as soon as possible. I have zero savings.... I stuff it all into the pension pot, an amazing protective barrier from IHT.
Single people and divorcees without children are discriminated against and are unable to leave their estate to nephews or nieces. Grossly unfair in my view.
When my dad died several years ago. Died from sudden death my parents were not married. I was 8 The government took 40% of everything!! It went to probate and the solicitor charged £300 per hour letter / email 😢
I'm going to be liable for it, but I've had it with this government and this is not a vote winner for me. There are ways to avoid or lessen the blow with IHT. You just need a good financial adviser.
How is it not the perfect tax? Only dead people pay it, and only the richest at that! I cannot even conceive of the scenario where someone is a major victim of this. To have lost money to it you have to be receiving many hundreds of thousands of pounds!
But it shouldn’t mean that you are driven to pay a financial advisor, just how many times are we expected to be taxed for anything during our life time! It infuriates me that we we get taxed, time and time again on that we have worked hard for.
It’s bonkers that this is a vote pleaser when so few people pay IHT. The RNRB needs reform though so siblings are included and not just direct descendants.
Needs reform. There should be a higher amount/allowance for those in London as properties are the highest than the rest of UK. All London homes are all above £325k. So all single home owners will have to pay. What is the point of owning a property, be poor & live on benefits!!!
My mother who was divorced from my deceased father has a pretty regular family house worth more than £500,000. She has 3 children and 3 grandchildren. So I'm going to be paying 40% tax on maybe a little over £100,000 of the money I receive, meanwhile Cuthbert who is an only child of a wealthy couple can pick up £1,000,000 tax free. Its that kind of inequality that needs to go. Also the Duke of Westminster inherited £8billion without paying any tax as his family set up a trust fund. Its a silly tax that only catches a few people in the middle.
It’s an unjust Tax, people work hard all their life’s and get taxed on money earned, money spent and even money saved. Other countries have abolished it completely. The Tax system is complicated too much as it is. So is this the whole U.K.? I thought it was £350k per person and £700k using a dead partners like a husband or wife’s Allowance. Didn’t know if you pass on a house it goes up to £500k.
@@mrscreamer379Or instead of being upset at someone getting a better deal maybe because his parents had a business who employed people for many years ha it so go we abolish it and everyone is on the same playing field. So the rich who have worked hard should give it up that’s a problem too why should they.
Thing is though, you’ve already paid income tax on savings and before your mortgage payments. That could well have been 40%, so they are taking 40% on top of 40% already paid while accumulating your estate. Daylight robbery as are many other taxes on top of taxed income. But not to worry, they’ll take it all away anyway to pay for the old people’s home and later nursing care, while those that have gambled or pished it all away will get it all paid for and they are the ones who get the sympathy also.
HMRC is the biggest scammers . They make rules butt in reality is scam The scam that is becoming rules and regulations just because they made it doesn’t mean is the right thing to do. Working all your life paying tax on every thing than you give 40% 😂😂😂😂
higher taxes = higher inflation = government subsides to quell inflation, The rising interest rate can surely control inflation, but won't prevent erosion of the eroding purchasing power of the US dollar. I have learnt my lesson this time. The banks can't be making money off my money, while inflation eats into it. I have set aside 650k to invest in the stock market now, since that keeps up with inflation, but I don't know how to get started.
Yeah, things may be hard right now, but I've come to realize both bear and bull market, recessions and economic boom, all provide opportunities to make high gains, I used to call bluff on folks that bragged about making a fortune from such down-markets until I happened to do so myself
Keeping money in the bank is like paying banks and the Government. Here's how it works: The bank gives out your money as loan, and charge interest obviously higher than inflation rate, and then give you, the depositor, interest lower than inflation rate. That means net loss for you. That is why I prefer to invest, and on average, my advisor makes returns that always beats inflation!
To be honest, I've been wary of banks for a while, but I wasn't sure how to speak with an advisor first. Please let me know who your adviser is if it's okay; I need some recommendations.
Finding financial advisors like "Rebecca Noblett Roberts" who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.
These issues are mind boggling, especially if you are not financially minded, or savvy. The whole death thing, and how to negotiate this mine field, frankly terrifies me.
With house prices now and inflation, it think it will become more of an issue for current middle earners. Its a popular policy to reduce it for the simple reason it is a tax on a tax, any wealth generated will have tax paid on it from the start. It is not a `let the wealthy keep more money` policy to reduce IHT, but of course it will have no bearing on the poorest, who just need more money in their pocket today
Inheritance tax…..Either ditch it or fix it because there are loopholes that has existed for centuries that has enabled the upper class to prevent them paying it. This has caused the great divide in wealth in the UK.
I'm so happy I made productive decisions about my finances that changed my life forever,hoping to retire next year.. Investment should always be on any creative man's heart for success in life
YES! that's exactly her name (Stacey Macken) I watched her interview on CNN News and so many people recommended highly about her and her trading skills, she's an expert and I'm just starting with her....From Brisbane Australia
Truly, investing has changed my perspective on how one can succeed in life; working multiple jobs isn't the optimal way to attain financial freedom and unfortunately, we discover this later in life. Currently earn as much as 12 grand weekly and this has improved my financial life
Wow. I'm a bit perplexed seeing her been mentioned here also Didn't know she has been good to so many people too this is wonderful, I'm in my fifth trade with her and it has been super
What gets me is i have been living with my partner for 20 years, i have worked 33 years and recently i was out of a job redundancy and i could not claim for anything no benifits even for dentists doctors etc because my partner was earning more than £16 grand a year, so you get nothing if your not married and get nothing when they pass (if they go before you do)
I have some good friends who have been together since University 30 years+. When they reached the point where they could afford to buy they got married because it improved their tax situation.
I lost over $70k when everything started to tank. Not because I was in an exchange that went belly up. I was just stupid to hold and because that's what everyone said. I'm still responsible. It just taught me to be a better investor now that I understand more of what could go wrong. It took me over two years of being in the market, I'm really grateful I found one source to recover my money, at least $10k profits weekly. Thanks Natalie Strayer.. .
Natalie Strayer has really set the standard for others to follow, we love her here in Canada 🇨🇦 as she has been really helpful and changed lots of life's
Wow - my mum is house rich and money poor as she lived in London. All her life my parents struggled and the one thing they had was a house. They have 4 kids and looks like a decent chunk of what will be left will go to the government.
Thank you for sharing. In cross border inheritance between England and Spain what happens if defendants have NOT paid UK and Spanish inheritance taxes? What happens if defendants pass away from the vaccines? Does everything go to the claimant (legal English and Spanish heir)?
It’s a tax that needs to be abolished. It’s not the most affluent house holds who pay it! Example when the Duke of Westminster Died and his son inherited his estate the inheritance would have run into the billions he paid nothing of the sort.
I’m Australian and didn’t know how this tax worked but and it’s occasionally suggested we will get it here. If it is and it’s similar I don’t have a problem with it after your explanation. What I do find very strange is that I always thought it was a tax paid by the recipient, however the way you talk about it, it’s paid by the deceased. Personally, I think that is gross. It would be more acceptable if it was calculated on the deceased’s assets etc. But the tax imposed on the recipient.
Excellent simple explanation from Martin. It is deliberately made to sound complex by the sharks and vultures who call themselves financial advisors, tax advisors, and similar. As Martin says, only those with substantial wealth are exposed to significant inheritance tax, and if they can't work out what's best for them, then they should seek advice. The government can always introduce new legislation, so even the most thorough tax planning could be rendered ineffective. Lots of people will make themselves stressed and ill worrying about money when they actually have plenty and could relax and enjoy their life. Those who need to be concerned are those with no assets, renting, in debt, and not skilled in playing the system. These are the people who end up as alcoholics, on anti-depressants, and ultimately dying young. Sad so many people obsess about money who don't need to and who could enjoy themselves. Martin is a good guy because he debunks the scaremongers and helps people to stop worrying and helps people to avoid being ripped off.
I can't agree that it only hits a certain elite groups. My late father worked on the tools all his life, working class through and through. Because he had been prudent as a young man he had managed to retire to a nice detached two bed cottage in Kent just outside London. After he passed I had to pay IHT and saw nearly half the inheritance, that my father had worked hard to setup and pay tax on in the first place, disappear overnight. It's a nasty, pernicious tax that must hit almost any estate leaving a property in the SE and other high value property areas of the UK. Good riddance if it does go is all I can say. *caveat to my rant: this was about eight years ago now and I think the thresholds and application may have changed since then. However I still maintain it's a nasty tax.
The bloke wasn't wealthy he probably scrimped all his life , never had a holiday just so he could leave it to a corrupt goverment . and certainly didn't waste his money on costa coffee @@Chris-im3ys
So when second parent passes then IHT is paid at 40% on anything over £1 mill assuming they have passed the property over to their offspring (explicitly stated in a will for example).
For everyone here complaining about IHT... The tax take overall need to be the same total number. Which leaves two options: 1) Pay more tax (income, dividend, capital gains, VAT, VED, duties etc.) while you are alive Or 2) Pay inheritance tax on your estate when you're gone. Be careful what you wish for.
Be careful if you plan on getting married just to avoid paying IHT ..I know far more people lost everything in a nasty divorce than I know who have lost money paying inheritance tax
Worth mentioning. If you have a pension pot then that is not considered an IHT eligible asset. So, if you have £900,000 in assets, and you have a pension pot of £200,000 then the pension pot does not take you over the £1,000,000 threshold. You will not pay any IHT.
Good explanation with one key confusion. Martin uses the word “you” a lot. But, in this case, the “you” will now be dead. So, key clarification is that the executor / administrator has to do the paying of the tax if required.
I'm 66, I'll probably live another 20 years if I'm lucky. So mr Lewis what will the government be in 20 years? what will the rates be, for income, inheritance and capital gains taxes, is it best to pass the money on now, when Idie, through a clever dodge , a trust fund? I received advice and took out a private pension in my thirties I was assured I would gain financially. The previous government stopped raising the basic tax threshold, but boasted and raised pensions in line with inflation or wages. So now I pay tax on my pension. I'm sure I could pay an accountant and he would give me advice on the best way to avoid tax which would be valid until the next budgets tax changes.
More people will pay this tax if they live on their own. (Wealth they have already paid tax on). It is taxed at a marginal rate of 40% which is twice as much as CGT.
Unfortunately with inflation, especially house price inflation, many people find themselves caught out by IHT unexpectedly. Giving from spare income is the most efficient - and underused- means of reducing IHT liability. Keeping records is helpful; form IHT 403 contains a simple layout for this
Inheritance tax may apply to estates above a certain value. However it does apply apply to the most wealthy. The “royal” family does not any inheritance tax and receive tax allowances on Duchy income.
Martin, I LOVE you & your videos! The tax system is really unfair in this country, especially for a lot of Lower/Middle class British people. Have you heard of a TH-camr called,"Gary Economics?". Please search him out as he is on a public quest to try and change some of the ways people are taxed in this country. You both could be a force to reckon with! ❤
Hypothetically as a divorced or single person the maximum I am allowed to leave including the value of my property is £500,000 and this is only the case if I have a direct descendant, otherwise £325,000. I can see many more people being dragged into this tax given the price of property these days, and the divorce rate.
Can you sell the property ahead of probate… would it still count? Or must a physical property still exist at the the time of death to get the extra tax allowance?
I'm still confused. My mother is now 90 yrs old. She has savings of around £40,000, which she has decided she would like to transfer to my bank account before her death. That would be my full inheritance if she passed away, so it is below the amount to pay inheritance tax. But if I receive the full amount now & she were to pass away in the next 7 yrs does the nil to be paid still stand or would I still be liable for inheritance tax?
Regardless of your estate size the mortality of taxing someone who has been left money or assets by someone who has passed is immoral. They were taxed on income their whole life and desperate politicians bring in MORE tax cause you wont care when your dead
I applied to HMRC/DWP regarding the married couples when my dad died in 2003 about my mum on less pension than my dad I watched your programme in 2022 & im still waiting 16-18 months ago
Not as rosie as he states. Here's one scenario : A single person with no children, owns a UK average house worth £290,000 and has £100k savings. Not a rich person by any means will have to pay (390-325)* 0.4 in inheritance tax = £26,000. Personally, I'll be paying £260,000 in IHT unless I get married or emigrate.
The problem is its not a fair tax. Why? In the financial advice industry it's nicknamed 'the voluntary tax'. Because with the right financial advice you can largely avoid this tax. Therefore the very wealthy usually do. They know its coming and have the wealth to be able to plan for it whilst having money on tap for the here and now. It tends to be the middle classes that get stung for this tax. Those who have looked after their savings, invested a bit of money, and have seen the value of their properties go up dramatically over the years. The left like to point to the numbers that very few pay this tax and can't understand why people hate it so much. But this just shows a lack of understanding that we are a very moral bunch in the UK and whilst we are gonna get dragged into it or not we think it's wrong to get taxed again on money which has already been taxed to high heaven.
But the huge gain potentially made in property value, say family home, house, hasn't been taxed before. Buy house for 100k , 30 years later it's worth 600k, none of that money has been taxed.
It's not that wealthy can avoid it, it's that they take advice and many middle-class individuals don't take the right advice. It's really easy to take sensible steps and avoid silly pitfalls. I was a financial adviser for over 30 years and this was bread-and-butter. Most people imagine that they can give their property to their children to avoid IHT while still living in their house. They don't want to give away capital in their lifetime in case they need it. You can't have it both ways... Keep it and pay the tax, or give it away. OR, take out insurance equal to the inheritance tax bill, write that in trust for your family and then keep your capital. So many options...
@@friendlyhorseuk7220 yet the house has the same utility as when it was purchased, so has it really gone up in value if equivalent shelter has the same value? Should all that value be taxed now? Why don't you advocate capital gains tax on housing then, instead of this unfair death tax?
@@adamp6320 capital gains tax is already charged on gains made on houses that aren't a persons main home . I think IHT exempt allowances are generous already at 325k + potentially an extra 175k on a home so up to 500k tax free. Also I don't accept the term death tax, . Dead people don't and can't pay tax. The tax is paid by the beneficiaries , not the deceased
Fair to say that atm only ~4% pay the tax. What we have though is a boomer generation that is coming to the stage in life where there are more popping off. This generation more than any have benefitted from increased asset values much of which is still stored in investments and property. That 4% is going to rise significantly in the next 10-15years. I doubt the govt is going to want to throw that out. What I expect to see is a raising of the threshold to ~425k for cash & 750k inc property.
I think you're spot on with this. My brother and I fall into this category because our Dad saved his hard earned money, but mainly due to property price rises. The house we will inherit is a 4 bed detached and by no means grand but worth around £750k currently. With property prices as they are, it's hard to think only 4% will pay going forward. There are ways such as inheritance tax isa's you can invest in that avoid the tax because they invest funds in small businesses.
Good point. The future is a foreign country though. Property value has certainly accelerated rapidly but so has the time folk live with chronic conditions. I can see a situation where very many ordinary houses in the South East go above all thresholds, yet have been effectively been mortgaged to pay for Care. My Mum died recently at 96 and a close relative is still living in Care at 103. It all gets complicated.
I always have this question: we have our residence, and buy stock while alive, to try and get an income with our money. If we die and the stock goes to our child, do they pay inheritance tax on that? even if I worked 30 years to accumulate that?
1. Isas have limits and all your money should be spread out and not in only 1 thing. 2. Cash isas are covered by the fscs so only 80k in insured if the bank goes bust 3. Idk if I pass and leave the isa to my child if they actually get the isa, or the money is taken out and then used as inheritance 4. If the royal family was exempt, everyone should. Any law that is for some only is an unfair law that should not exist
What contract is inheritance tax? All contracts belong to a trust. 1. Who founded the trust? 2. Who is the grantor? Answer 1. The Agent. The agent who works for the state. The servant. 2. You are the grantor, you own the Res and the trust. Stop fighting policy. Fight the declaration of the trust. The agent pledged the trust for you, and it then defined the trustee and beneficiary position on your behalf. The owner can express their will on the trust. So, just do that. Declare yourself as the beneficiary and the agent as the trustee. Job done. And the agent imposing their will on your property is the trustee; they become liable. Stop fighting policy and start fighting trusts.
So, in a nut shell. If our ( my wife and I)estate is valued at under £1m there will be no inheritance tax to pay of the estate goes to our children? If it's over £1m does inheritance tax only kick in on anything over the £1m?
no everything over 500k when leaving to children is taxed at 40% soon to be 55% under starmer so if your house sells for 1 mil they'll pay 275k tax, 55% of 500k
When my single parent mother bought the house it was under 100k and now looking at houses on my road for sale over recent years, its over 500k and looks like it will keep rising. It's my main residence. But that means I will need to pay inheritance tax and its not like we are wealthy. Surely a lot more people in London will be hit with IHT as low - average wage workers?
Londoner here. A lot of houses in London are affected. I've had to do IHT planning with a tax advisor as my parents own two houses both worth over a million. They bought one for about £80k and the second for £160k. London property has been insane.
@@stephen129 incredibly! My mother is with ill health now so I don't think gifting will amount to lowering the tax at this point but who knows. It was something I knew about years ago but I was much younger then and broaching the subject would have been difficult and it quite difficult now too. Much easier with my dad who was more pragmatic about things even when he passed. Sigh, adulting.
I could only afford a one bed flat in London on a low wage. Bought my 1 bed flat 40yrs ago. Can't afford to gift anything then or now retired. I can't afford to put heating now! Nil IHT if gifting 7 years before you die is ridiculous unless you are wealthy. As if we know when we are going to die?
@@WalkWithWallace I know, but 40% of over that and houses around me are 545k- 575k and rising will cripple me as a single person on an average wage especially considering our house was like 82k when we bought it and its been our home since. for the average Londoner in this situation its quite worrying.
Brilliant. Excuse my ignorance, no inheritance tax for most estates, but equally important... Will the heirs pay income tax on their inheritance is still baffling.
One thing I cannot find clear information relates to "gifts out of income" for a married couple where one of the couple does not work. The worker has a good income. Is the gifts out of income allowance £3000 (from the one who works), or £6000, as the working spouse can give money to his/her non working spouse so he/she can make a £3000 gift - all without affecting normal life style. In addition, if the couple want to splurge on an expensive holiday one year, but have to sell some stocks/shares to finance this, does this affect the gift allowance for that year?
Nowadays I think the bigger concern is losing your estate to care home fees.
What do you suggest, stay home and live in your own excrement 😂
It broke my grandmothers heart to know that the care home she was in was costing £1300 a week, she was in there for 2 years. She wanted this to be her children's inheritance
@@bensims7501A nurse at home wouldn't cost £5000 a month.
@laurainsley2907 yeap, but they (carers, not nurses) work 8 hour shifts. she needed 2 people to lift her that's 6 people a day
No! Mucky as that sounds! I think you can set up a trust fund which remains out of reach of the Local Authority , and the money can be left to your beneficiaries, who will top up any fees in the event that the state accommodation is ...er...full ofexcrement to use your description!!@@Petrolhead912
In the 1990s I sold pensions on the strenght that the tax free lump sum would pay off most if not all of the mortgage and leave the investor with a pension for life. Most were over a 40 year term plus, I was not alone.
The approach of selling pensions with the promise that a tax-free lump sum would pay off mortgages and provide a lifelong pension was common in the 1990s. However, many factors can affect the outcome, including changes in the housing market and interest rates. It's crucial for investors to seek personalized advice and consider diversified financial strategies to ensure long-term financial stability.
it's vital for investors to seek personalized advice and adopt diversified financial strategies. Working with a knowledgeable financial adviser is crucial for achieving long-term financial stability and freedom
I've experimented with a few over the past years, but I've stuck with ‘’Nicole Anastasia Plumlee” for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look her up.
You've posted this in more than one place. Feeling bad about that?
@@misterbonzoid5623 obviously feeling very bad
Small taxes can affect investment decisions such as whether to choose tax-free municipal bonds over taxable bonds or do a Roth IRA conversion. I’ve been sitting on over $745K equity from a home sale and I want to invest on the stock market, how do I achieve this without being taxed twice?
There’s more benefit to holding fixed-income assets in tax-deferred retirement accounts as opposed to taxable accounts. If you're not who understands strategies to invest in the market, seek a Financial advisor to guide you.
Indeed, I did make use of a financial counselor. As I get closer to retirement, their advice has been really helpful. I thought compound interest on index funds wouldn't be sufficient because I started late. It's amusing how I've done better than colleagues who have more years of investment experience. I've profited more than $886k tax free.
Hope you don't mind if I ask you to recommend this particular professional you use their service?
Certainly, there are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’Sophia Maurine Lanting” for about five years now, and her performance has been consistently impressive.She’s quite known in her field, look-her up.
She appears to be well-educated and well-read. I ran a Google search for her name and came across her website; thank you for sharing.
I feel investors should be focusing on under-the-radar stocks, and considering the current rollercoaster nature of the stock market, Because 35% of my $270k portfolio comprises of plummeting stocks which were once revered and i don't know where to go here out of devastation
Safest approach i feel to tackle it is to diversify investments. By spreading investments across different asset classes, like bonds, real estate, and international stocks, they can reduce the impact of a market meltdown
No doubt, having the right plan is invaluable, my portfolio is well-matched for every season of the market and recently hit 100% rise from early last year. I and my CFP are working on a 7 figure ballpark goal, tho this could take till Q3 2024.
Please can you leave the info of your investment advisor here? I’m in dire need for one
Celia Kathleen Martel is the licensed advisor I use. Just search the name. You’d find necessary details to work with to set up an appointment.
I just googled her and I'm really impressed with her credentials; I reached out to her since I need all the assistance I can get. I just scheduled a caII.
That’s the first time I have heard anyone explain the situation about each partner having a double allowance. Thank you.
Inheritance tax can be a source of confusion, with various myths surrounding who will pay it and how it truly works. Contrary to common belief, not everyone is subject to inheritance tax in every situation
Understanding the intricacies is crucial, as the tax depends on factors like the value of the estate, the relationship to the deceased, and available exemptions. Dispelling these myths is the first step in demystifying inheritance tax.
Having recently dealt with the complexities of inheritance tax, I can attest to the importance of professional guidance. It's not just about the financial aspect but understanding the nuances of tax laws. I engaged a certified advisor who not only clarified the intricacies but also helped optimize the financial implications, ensuring I paid only what was necessary.
Your experience echoes my concerns about potential inheritance tax. Could you share more about your advisor's approach and how they helped you navigate the intricacies of this tax?
@@mariadrukker2557??
I work with Eric Paul Elmer.
The bigger concern is if you need care and own your home the council will take your home, you’ll have nothing to leave. This is what most pensioners like myself are concerned about.
Why would the council take your home if you need care? Curious.
@@shamir.globalimpact Think he means, if they're put into a care home, and they own a house, Government will use the value of the house to fund the stay at a care home, at apparently high rates. You only get help from the system, if you financially have nothing.
That in itself controversial. One one hand, people who have nothing need help from Government, but if they contributed nothing or little into the system why are they getting too much help?
Those who contributed to the system can't get access because they have their own finances, but at the same time, why shouldn't get access, when it's their taxes that prop up the system in the first place and now they need some help back.
@@MrGts92Ah ok understood. If that is the reality, that's actually horrible.
@@shamir.globalimpactto fund your care you would have to sell your home and pay for care from the proceeds…the council don’t do this or take your home to do it…you or your family have to do this …but paying for your own care means you can find a care home you like where you like and some are splendid.
Such a brilliant video explaining simply.Been looking on internet & a little confused. the way things were worded.Martyn has summed it up so well.Thank you
Great video, I have a quick question. I am an aspiring trader, I am looking study some traders and earn off their expertise rather than investing myself and lose money emotionally. What's your take on copy trading? Do people really make money? Just looking for some reassurance.
Focus on long term investments in property, stocks, and bonds. Avoid copying, day trading and 'chart astrology'. Diversify across different geographies, industries, and value chain stages - to reduce your risk. You can do this with ETFs, or by selecting different stocks yourself. This is the best way to invest for more than 90% of people
How can I participate in this? I sincerely aspire to establish a secure financial future and am eager to participate. Who is the driving force behind your success?
Ashley Airagahi is her name. She is regarded as a genius in her area and works at ALGO LAW FIRM. She’s quite known in her field, look-her up.
Thank you for this tip. It was easy to find your coach. Did my due diligence on her before emailing her. She seems proficient considering her resume.
Total scam
Brilliant summary. Anyone asks me about IHT, I’m going to point them to this video.
You may want to point them to the 'capital gains video' first. ....
God forbid you point them to a professional advisor who has qualifications, does it for a living and has spent their career advising people.
Thank you Martin, that's a very worthwhile and illuminating 4 minutes. Well done.
Point 6. Whilst only 4% of households pay inheritance tax, many many more have to complete bonkers hrmc forms to prove no tax is due. If you ask a solicitor to do it for you it will cost around £10,000. If not you get to fill in around 80 pages across 13 forms. It is a bureaucrats wet dream and very time consuming.
But think of the £700k you will receive for your 5 hours work!
I agree. It is just 'another' government endorsed hurdle and hmrc financial gain put in place of your 'rightful' inheritance that they have already charged tax on when it was 'originally' either earnt or purchased. And now they want more!.
@@yesihavereadityou mean the 700k avoid paying? With that logic you should be happy to pay up to some 690k to prove you shouldnt pay
Ive just had a free chat with advisor Clare Sutherland and she has answered all my questions, especially about lasting power of attorney, IHT, wills and if a trust fund would help. Trust funds can be very expensive. Everyone's situation is different so I think speaking to a professional has helped me understand how I can protect and make it more straight forward for my children to pick up the pieces if I lose capacity and when Ive gone.
The main problem I have with it is that the wealthiest almost entirely avoid it via complex financial vehicles/offshoring etc. Yes, only 4% of estates pay it today, but that number will go up substantially every year as house prices continue to rise and the tax thresholds are frozen.
Taxing twice at 40%, even for affluent households, is imo too heavy a burden, but if you’re going to do it, at least make the very wealthiest pay it as well. Not to do so is a huge injustice.
Yes and in the case where a spinster aunt died leaving everything to her sister, who had died previous. With My brother and sister we inherited her estate, it came over the £325 K threshold so 40% IHT was charged which just left me asking why.
Her earnings were taxed, her taxes money invested and profits taxed, taxes when property bought, and then they want a further piece of the action.
@@guyr7351 The tax is on you.
You are looking to come into a sum of wealth that you didn't earn.
Unearned income is still income.
Unearned income is taxed below the level of earned income.
Stop complaining.
You received a bunch of cash you did not earn.
Pay your tax and count yourself lucky.
Luckier than most.
Why should you be able to accumulate so much intergenerational wealth when to do so invariably disadvantages everyone else?
@@bakedbean37 one way to look at it, to me it is the state having another bite at the cherry. I’m not sure how it disadvantages other people though, the amount of tax raised is modest by the Governments income levels from other taxes, and as others have said those estates that are much higher valued systems and ways are found to pass the wealth down.
I did use the money wisely and it was not money I had ever anticipated, but I had promised my mother when she was dying of Cancer I would make sure her sister was OK a promise I kept, being the only person who made the effort to see her in her final days, (covid was still having an impact) talking to her as she slipped away. I also made a payment to a cousin who I know my aunt wanted to give money to, the other beneficiaries wouldn’t make any payment. But hey ho it is what it is
@@bakedbean37 Because it was her aunt's money. Like it or not: family looks out for family. The tax has been paid. You, my friend, should not have a say.
@@Nora.........earn your own money don't rely on handouts. These rich scroungers are insufferable! Take the money and keep quite. Many people are struggling to feed themselves and their kids, they don't want hear about people complaining they missed out on 100K and only got 500k in inheritance.
People who never saved are better looked after as they can get pension credit and other benefits. People who worked all their lives and saved by being frugal are punished. My pension is very small and every month I have to dip into my meagre savings after working and paying taxes for 45 years. My pension is just over the threshold for claiming pension credit. I am single and there is no one to share the bills. No one knows how long they have got on this planet but my thinking now is enjoy life by spending your savings and if you live long enough without any savings left, then let the government / council take care of you. People with no savings or assets pay nothing for being in a home but others with some assets have to pay.
Totally agree. Well said.
Agreed so true. People on benefits are better off.
You are not going to be effected by inheritance tax.
@@lenrichardson7349 You are right I will not be hit by inheritance tax but I am being punished now!
Surely as house prices keep rising more and more people will be subject to it
Maybe 96% of estates didn't pay Inheritance Tax, but that is because a lot of those have jumped through all the hoops in the preceeding years to ensure they didn't pay.
It can easily creep up on you: a sadly widowed middle-aged person who thinks they've still no concerns about IHT can soon be thrown into problems if a parent leaves them their estate and it's worth a surprisingly large amount. £1m is not as much as it first seems once you factor in your own home AND an inherited home.
You didn't mention that pension pots do not count towards your estate value on death so its a very cost effective way to leave a large sum of money.
Private pensions can "sometimes" be included which I why, I suspect, Martin didn't stress this. If you have a flexible pension (like a SIPP) and reduce your drawings because you know that you are terminally ill, in a bid to pass on wealth, HMRC can charge the pension to IHT. In any event, if you die older than 75 and leave a pension fund to anyone (spouse, children or grandchildren) they pay income tax on what they take out of the inherited pot which could be 20%, 40% or 45% so could be more than IHT albeit the tax is on withdrawals whereas IHT is before it's passed on.
@@mikeowen1819 once they reach 75 years of age that's it.
@@sickbuffalo9902 what do you mean?
The biggest scandal around inheritance tax is HMRC demanding payment directly, but you can't pay untill Probate is granted which is in the hands of another branch of the burocracy that is even more dysfunctional than HMRC.
You’re given 6 months to pay it.
Probate is quick if there is a valid Will in place.
Was told recently probate is averaging 9 - 12 months since covid...
Only 4% of people pay the tax. They'll be rich people. Fuck em .
My Mother is going into a care home and the house she and my deceased Dad bought is to be sold off, her savings account emptied and used to pay for her £1200 per week care.
£130,000 worth at the moment. Sadly, that's how it goes, the money my Mum and Dad created over 60 years is going to the nursing home manager. Someone has to pay for it!
Looks like myself, my brother and sister are getting no inheritance at all. What a wonderful country. 😞😡
This is so difficult but the good thing the money your parents earned is taking care of your Mother in her old age,bless her. I hope she is happy and gets care of the highest standard as her money is paying for it, anything left will I am sure come to you all. I would be thankful she is being well looked after and you are all doing the right thing by your dear Mum. Bless you all.
Oh cry me a river. If you’re that concerned about it not getting HER money, you & your 2 siblings can take your Mum in and care for her yourselves.
I recently inherited almost $500k. I REALLY need to make this money work for me, and not just disappear over time. I've been scrambling for somewhere to put the money, where can make an effort to use the gains to pay bills so I can quit my job. All roads have pointed to the financial market of some sort which is a good idea buh where else should I put money besides the financial market? We have a 13% RPI rate so cash is tough.
Amazing well done! Which companies have performed best for you?
I'd say your lA is doing a great job protecting your portfolio. More still impressive as you're making fortunes in these turbulent times!
Wow I know Samuel Peter Descovich. His platform maintains a unique perspective and is very transparent with their investors.
Regardless of whether or not he outperforms i will always stay invested as his methods alone with keeping investors in touch with their strategies and outlooks are something that so few managers are capable of and they should follow suit
Yeah real, that guy is one asset manager that gives the breakdown of everything on how things are done, joining an effective financial community can be 100% beneficial when joined properly that's all I can say out of experience
I also found his impressive resume on Google. It feels like a blessing to have come across this comment section.
I’m never likely to have enough for inheritance tax to be applied to my estate, but I still think it’s a despicable tax.
We pay tax on everything all our lives, so why should stuff we’ve bought or money we’ve saved, that we’ve already paid tax on, be taxed again on our death.
This was a tax originally aimed at the super rich, now to be honest it affects the moderately wealthy, it shouldn’t be applied to anyone, but if the government must steal money, maybe they could reign it in a bit & only charge 20%.
You have paid tax on the money in your estate and you are not going to pay again. However a person who has not worked or saved to create that money is going to be taxed if you give that money to them. Just like wages every time money is moved from one person to another it is taxed. Your employer gives you money you pay tax, you give money to the window cleaner, they pay tax. We all have to pay our own dues in life.
Excellent summary, thanks Martin.
Sounds like a tax on single people to be honest.
It's not a tax on the person dying, it's a tax on people receiving unearned income.
@@garyh1572 I always wondered about that phrase unearned.. I get it, your children didn’t earn the house or the tax paid wages that paid for it or the tax that the bank paid on the profits on the interest you paid.
A son could be 60 when inheriting a family home and take a mortgage out to keep it after paying the tax on it… then use a part of his pension 5 years later to clear that loan. He could die a year later, 6 years after he paid the tax on the house and leave it to his daughter who then also has to take another mortgage on her tax bill.. it never ends and is a disgrace.. all because you’d like to keep your family home.
@@garyh1572the government certainly didn’t earn a penny of it so they are not entitled to 1 single red cent of it. They are nothing but legal mafia thieves.
My children are my responsibility and what’s mine is theirs, they earned it through me and my efforts as a responsible parent who does not leave burdens on society as I built foundations for them to build on.
@@garyh1572 The income was earned. By their family member.
@@zionjzachary Yes, but when they receive the money ,it needs to be taxed like income. Less than 3% of the population pay it anyway. It won't affect you - stop defending very rich people.
One checkpoint as not sure 500k on residence is correct, it’s up to 500k as residence value is the tax free amount so if you left 500k in cash and residence was 100k tax free would be 425k the rest would be taxed still.
I am not rich, but my estate will attract IHT. Single people, usually divorcees, owning a home in the South East will be caught every time!
I'm the same as you, single divorced but house around £700K, the going rate for a modest family home in SE. When my son is ready to buy a house I will downsize to pass the extra £200K on as soon as possible. I have zero savings.... I stuff it all into the pension pot, an amazing protective barrier from IHT.
Single people and divorcees without children are discriminated against and are unable to leave their estate to nephews or nieces. Grossly unfair in my view.
@@pvelectronics4291The best laid plans of mice and men oft go awry.
Thank you Mr Lewis
For what?
When my dad died several years ago. Died from sudden death my parents were not married. I was 8 The government took 40% of everything!! It went to probate and the solicitor charged £300 per hour letter / email 😢
Thanks Martin. This really cleared up the misunderstanding we had about inheritance tax and gave us peace of mind.
It’s a dirty tax and I’d vote for whichever party gets rid of it. Not fussed about any other policy!
I'm going to be liable for it, but I've had it with this government and this is not a vote winner for me. There are ways to avoid or lessen the blow with IHT. You just need a good financial adviser.
How is it not the perfect tax? Only dead people pay it, and only the richest at that! I cannot even conceive of the scenario where someone is a major victim of this. To have lost money to it you have to be receiving many hundreds of thousands of pounds!
But it shouldn’t mean that you are driven to pay a financial advisor, just how many times are we expected to be taxed for anything during our life time! It infuriates me that we we get taxed, time and time again on that we have worked hard for.
At last a clear explanation on inheritance tax! As ever thank you Martin Lewis!
It’s bonkers that this is a vote pleaser when so few people pay IHT. The RNRB needs reform though so siblings are included and not just direct descendants.
Needs reform. There should be a higher amount/allowance for those in London as properties are the highest than the rest of
UK. All London homes are all above £325k. So all single home owners will have to pay. What is the point of owning a property, be poor & live on benefits!!!
@@venuslin8647 there definitely should increase the allowance across the board, not just London. I’d rather own than rent tbh.
My mother who was divorced from my deceased father has a pretty regular family house worth more than £500,000. She has 3 children and 3 grandchildren. So I'm going to be paying 40% tax on maybe a little over £100,000 of the money I receive, meanwhile Cuthbert who is an only child of a wealthy couple can pick up £1,000,000 tax free. Its that kind of inequality that needs to go. Also the Duke of Westminster inherited £8billion without paying any tax as his family set up a trust fund. Its a silly tax that only catches a few people in the middle.
It’s an unjust Tax, people work hard all their life’s and get taxed on money earned, money spent and even money saved. Other countries have abolished it completely. The Tax system is complicated too much as it is. So is this the whole U.K.? I thought it was £350k per person and £700k using a dead partners like a husband or wife’s Allowance. Didn’t know if you pass on a house it goes up to £500k.
@@mrscreamer379Or instead of being upset at someone getting a better deal maybe because his parents had a business who employed people for many years ha it so go we abolish it and everyone is on the same playing field. So the rich who have worked hard should give it up that’s a problem too why should they.
Thing is though, you’ve already paid income tax on savings and before your mortgage payments. That could well have been 40%, so they are taking 40% on top of 40% already paid while accumulating your estate. Daylight robbery as are many other taxes on top of taxed income. But not to worry, they’ll take it all away anyway to pay for the old people’s home and later nursing care, while those that have gambled or pished it all away will get it all paid for and they are the ones who get the sympathy also.
HMRC is the biggest scammers .
They make rules butt in reality is scam
The scam that is becoming rules and regulations just because they made it doesn’t mean is the right thing to do.
Working all your life paying tax on every thing than you give 40% 😂😂😂😂
higher taxes = higher inflation = government subsides to quell inflation, The rising interest rate can surely control inflation, but won't prevent erosion of the eroding purchasing power of the US dollar. I have learnt my lesson this time. The banks can't be making money off my money, while inflation eats into it. I have set aside 650k to invest in the stock market now, since that keeps up with inflation, but I don't know how to get started.
Yeah, things may be hard right now, but I've come to realize both bear and bull market, recessions and economic boom, all provide opportunities to make high gains, I used to call bluff on folks that bragged about making a fortune from such down-markets until I happened to do so myself
Keeping money in the bank is like paying banks and the Government. Here's how it works: The bank gives out your money as loan, and charge interest obviously higher than inflation rate, and then give you, the depositor, interest lower than inflation rate. That means net loss for you. That is why I prefer to invest, and on average, my advisor makes returns that always beats inflation!
To be honest, I've been wary of banks for a while, but I wasn't sure how to speak with an advisor first. Please let me know who your adviser is if it's okay; I need some recommendations.
Finding financial advisors like "Rebecca Noblett Roberts" who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.
I copied her whole name and pasted it into my browser; her website appeared immediately, and her qualifications are excellent; thank you for sharing.
Very succinct summary, thanks Martin!
These issues are mind boggling, especially if you are not financially minded, or savvy. The whole death thing, and how to negotiate this mine field, frankly terrifies me.
With house prices now and inflation, it think it will become more of an issue for current middle earners. Its a popular policy to reduce it for the simple reason it is a tax on a tax, any wealth generated will have tax paid on it from the start. It is not a `let the wealthy keep more money` policy to reduce IHT, but of course it will have no bearing on the poorest, who just need more money in their pocket today
Inheritance tax…..Either ditch it or fix it because there are loopholes that has existed for centuries that has enabled the upper class to prevent them paying it.
This has caused the great divide in wealth in the UK.
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Thank you for kindness to let us know thank you again 😊
Estates over £2m do get RNRB but it’s tapered away by £1 for every £2 over the £2m the estate is.
What gets me is i have been living with my partner for 20 years, i have worked 33 years and recently i was out of a job redundancy and i could not claim for anything no benifits even for dentists doctors etc because my partner was earning more than £16 grand a year, so you get nothing if your not married and get nothing when they pass (if they go before you do)
Get married?
I have some good friends who have been together since University 30 years+. When they reached the point where they could afford to buy they got married because it improved their tax situation.
Yes i understand that, but the government treat me as a couple living together now. But don't if he passes before me.@@IMBlakeley
Leave everything to charity & you pay no tax, we got our wealth from the system so give it all back to the system end of.
This is precise and concise summay, thank you. May be you can do another one on Capital Gains Tax!
Hi
at 2.06-2.07 in the video, you said £350000 goes up to £500000. Did you mean £325000 goes up to £500000?
I lost over $70k when everything started to tank. Not because I was in an exchange that went belly up. I was just stupid to hold and because that's what everyone said. I'm still responsible. It just taught me to be a better investor now that I understand more of what could go wrong. It took me over two years of being in the market, I'm really grateful I found one source to recover my money, at least $10k profits weekly. Thanks Natalie Strayer.. .
The very first time we tried, we invested $2000 and after a week, we received $9500. That really helped us a lot to pay up our bills.
Natalie Strayer has really set the standard for others to follow, we love her here in Canada 🇨🇦 as she has been really helpful and changed lots of life's
I'm new at this, please how can I reach her?
After I raised up to 125k trading with her I bought a new House and a car here in the states also paid for my son's surgery
Glory to God shalom.
She's always active on Whats~App...
Also worth noting, and this is important, that money in the deceased person’s pension falls outside of the estate for IHT considerations!
not always... but usually.
Inheritance tax & capital gains tax should be abolished, why should the government have your funds for nothing, it’s your money
And that is why you can't take it with you...the tax man grabs it!
Wow - my mum is house rich and money poor as she lived in London. All her life my parents struggled and the one thing they had was a house. They have 4 kids and looks like a decent chunk of what will be left will go to the government.
Thank you for sharing. In cross border inheritance between England and Spain what happens if defendants have NOT paid UK and Spanish inheritance taxes? What happens if defendants pass away from the vaccines? Does everything go to the claimant (legal English and Spanish heir)?
It’s a tax that needs to be abolished. It’s not the most affluent house holds who pay it! Example when the Duke of Westminster Died and his son inherited his estate the inheritance would have run into the billions he paid nothing of the sort.
My Dad had me a little late and he should be retired but the economy won’t let him.
What would be the best route, Stock,a business or what.
I’m Australian and didn’t know how this tax worked but and it’s occasionally suggested we will get it here. If it is and it’s similar I don’t have a problem with it after your explanation.
What I do find very strange is that I always thought it was a tax paid by the recipient, however the way you talk about it, it’s paid by the deceased. Personally, I think that is gross. It would be more acceptable if it was calculated on the deceased’s assets etc. But the tax imposed on the recipient.
Excellent simple explanation from Martin.
It is deliberately made to sound complex by the sharks and vultures who call themselves financial advisors, tax advisors, and similar. As Martin says, only those with substantial wealth are exposed to significant inheritance tax, and if they can't work out what's best for them, then they should seek advice.
The government can always introduce new legislation, so even the most thorough tax planning could be rendered ineffective. Lots of people will make themselves stressed and ill worrying about money when they actually have plenty and could relax and enjoy their life.
Those who need to be concerned are those with no assets, renting, in debt, and not skilled in playing the system. These are the people who end up as alcoholics, on anti-depressants, and ultimately dying young.
Sad so many people obsess about money who don't need to and who could enjoy themselves.
Martin is a good guy because he debunks the scaremongers and helps people to stop worrying and helps people to avoid being ripped off.
Thieves pure and simple, how dare they.
I can't agree that it only hits a certain elite groups. My late father worked on the tools all his life, working class through and through. Because he had been prudent as a young man he had managed to retire to a nice detached two bed cottage in Kent just outside London.
After he passed I had to pay IHT and saw nearly half the inheritance, that my father had worked hard to setup and pay tax on in the first place, disappear overnight. It's a nasty, pernicious tax that must hit almost any estate leaving a property in the SE and other high value property areas of the UK. Good riddance if it does go is all I can say.
*caveat to my rant: this was about eight years ago now and I think the thresholds and application may have changed since then. However I still maintain it's a nasty tax.
Your father was in the 7% mentioned then. Just because he worked with his hands doesn't mean he wasn't wealthy.
The bloke wasn't wealthy he probably scrimped all his life , never had a holiday just so he could leave it to a corrupt goverment . and certainly didn't waste his money on costa coffee @@Chris-im3ys
You didnt pay any IHT, your farthers estate did.
So when second parent passes then IHT is paid at 40% on anything over £1 mill assuming they have passed the property over to their offspring (explicitly stated in a will for example).
Yes and assuming no lifetime gifts within 7 years that would eat into the nil rate band.
no it's 40% on anything over 325k or 500k if it's left to children
For everyone here complaining about IHT...
The tax take overall need to be the same total number. Which leaves two options:
1) Pay more tax (income, dividend, capital gains, VAT, VED, duties etc.) while you are alive
Or
2) Pay inheritance tax on your estate when you're gone.
Be careful what you wish for.
Not if you syphon the money through your duchy of cornwall business after your mother dies. Allegedly....
Be careful if you plan on getting married just to avoid paying IHT ..I know far more people lost everything in a nasty divorce
than I know who have lost money paying inheritance tax
Worth mentioning. If you have a pension pot then that is not considered an IHT eligible asset. So, if you have £900,000 in assets, and you have a pension pot of £200,000 then the pension pot does not take you over the £1,000,000 threshold. You will not pay any IHT.
Good explanation with one key confusion. Martin uses the word “you” a lot. But, in this case, the “you” will now be dead. So, key clarification is that the executor / administrator has to do the paying of the tax if required.
If you get married you'll have no assets left to leave to anyone, they'll all be gone when you divorce
I'm 66, I'll probably live another 20 years if I'm lucky. So mr Lewis what will the government be in 20 years? what will the rates be, for income, inheritance and capital gains taxes, is it best to pass the money on now, when Idie, through a clever dodge , a trust fund? I received advice and took out a private pension in my thirties I was assured I would gain financially. The previous government stopped raising the basic tax threshold, but boasted and raised pensions in line with inflation or wages. So now I pay tax on my pension. I'm sure I could pay an accountant and he would give me advice on the best way to avoid tax which would be valid until the next budgets tax changes.
4% not a lot, try telling that to the roughly 2.5 million people that have simply been robbed
Why should the people of this country pay inheritance tax when that prat of a King didn't pay a penny on his millions left to him. Uk 🇬🇧
More people will pay this tax if they live on their own. (Wealth they have already paid tax on). It is taxed at a marginal rate of 40% which is twice as much as CGT.
Unfortunately with inflation, especially house price inflation, many people find themselves caught out by IHT unexpectedly. Giving from spare income is the most efficient - and underused- means of reducing IHT liability. Keeping records is helpful; form IHT 403 contains a simple layout for this
Inheritance tax may apply to estates above a certain value. However it does apply apply to the most wealthy. The “royal” family does not any inheritance tax and receive tax allowances on Duchy income.
Martin, I LOVE you & your videos! The tax system is really unfair in this country, especially for a lot of Lower/Middle class British people. Have you heard of a TH-camr called,"Gary Economics?". Please search him out as he is on a public quest to try and change some of the ways people are taxed in this country. You both could be a force to reckon with! ❤
Hypothetically as a divorced or single person the maximum I am allowed to leave including the value of my property is £500,000 and this is only the case if I have a direct descendant, otherwise £325,000. I can see many more people being dragged into this tax given the price of property these days, and the divorce rate.
Can you sell the property ahead of probate… would it still count? Or must a physical property still exist at the the time of death to get the extra tax allowance?
Thank you. Really concise overview.
Brilliantly helpful as ever.
I'm still confused. My mother is now 90 yrs old. She has savings of around £40,000, which she has decided she would like to transfer to my bank account before her death. That would be my full inheritance if she passed away, so it is below the amount to pay inheritance tax. But if I receive the full amount now & she were to pass away in the next 7 yrs does the nil to be paid still stand or would I still be liable for inheritance tax?
Regardless of your estate size the mortality of taxing someone who has been left money or assets by someone who has passed is immoral. They were taxed on income their whole life and desperate politicians bring in MORE tax cause you wont care when your dead
I applied to HMRC/DWP regarding the married couples when my dad died in 2003 about my mum on less pension than my dad I watched your programme in 2022 & im still waiting 16-18 months ago
Well explained, thank you, Martin.
Not as rosie as he states. Here's one scenario : A single person with no children, owns a UK average house worth £290,000 and has £100k savings. Not a rich person
by any means will have to pay (390-325)* 0.4 in inheritance tax = £26,000. Personally, I'll be paying £260,000 in IHT unless I get married or emigrate.
The problem is its not a fair tax. Why? In the financial advice industry it's nicknamed 'the voluntary tax'. Because with the right financial advice you can largely avoid this tax. Therefore the very wealthy usually do. They know its coming and have the wealth to be able to plan for it whilst having money on tap for the here and now. It tends to be the middle classes that get stung for this tax. Those who have looked after their savings, invested a bit of money, and have seen the value of their properties go up dramatically over the years. The left like to point to the numbers that very few pay this tax and can't understand why people hate it so much. But this just shows a lack of understanding that we are a very moral bunch in the UK and whilst we are gonna get dragged into it or not we think it's wrong to get taxed again on money which has already been taxed to high heaven.
But the huge gain potentially made in property value, say family home, house, hasn't been taxed before. Buy house for 100k , 30 years later it's worth 600k, none of that money has been taxed.
It's not that wealthy can avoid it, it's that they take advice and many middle-class individuals don't take the right advice. It's really easy to take sensible steps and avoid silly pitfalls. I was a financial adviser for over 30 years and this was bread-and-butter. Most people imagine that they can give their property to their children to avoid IHT while still living in their house. They don't want to give away capital in their lifetime in case they need it. You can't have it both ways... Keep it and pay the tax, or give it away. OR, take out insurance equal to the inheritance tax bill, write that in trust for your family and then keep your capital. So many options...
@@friendlyhorseuk7220 yet the house has the same utility as when it was purchased, so has it really gone up in value if equivalent shelter has the same value? Should all that value be taxed now? Why don't you advocate capital gains tax on housing then, instead of this unfair death tax?
@@adamp6320 capital gains tax is already charged on gains made on houses that aren't a persons main home . I think IHT exempt allowances are generous already at 325k + potentially an extra 175k on a home so up to 500k tax free. Also I don't accept the term death tax, . Dead people don't and can't pay tax. The tax is paid by the beneficiaries , not the deceased
It's not expensive to get IHT advice and follow-up if your financial affairs are simple.
Fair to say that atm only ~4% pay the tax. What we have though is a boomer generation that is coming to the stage in life where there are more popping off. This generation more than any have benefitted from increased asset values much of which is still stored in investments and property. That 4% is going to rise significantly in the next 10-15years. I doubt the govt is going to want to throw that out. What I expect to see is a raising of the threshold to ~425k for cash & 750k inc property.
I think you're spot on with this. My brother and I fall into this category because our Dad saved his hard earned money, but mainly due to property price rises. The house we will inherit is a 4 bed detached and by no means grand but worth around £750k currently. With property prices as they are, it's hard to think only 4% will pay going forward. There are ways such as inheritance tax isa's you can invest in that avoid the tax because they invest funds in small businesses.
Good point. The future is a foreign country though. Property value has certainly accelerated rapidly but so has the time folk live with chronic conditions. I can see a situation where very many ordinary houses in the South East go above all thresholds, yet have been effectively been mortgaged to pay for Care. My Mum died recently at 96 and a close relative is still living in Care at 103. It all gets complicated.
I always have this question: we have our residence, and buy stock while alive, to try and get an income with our money. If we die and the stock goes to our child, do they pay inheritance tax on that? even if I worked 30 years to accumulate that?
It's an unfair tax (assuming that your income was earned legally). It should be abolished.
A lot of income and growth could be in untaxed isas
1. Isas have limits and all your money should be spread out and not in only 1 thing.
2. Cash isas are covered by the fscs so only 80k in insured if the bank goes bust
3. Idk if I pass and leave the isa to my child if they actually get the isa, or the money is taken out and then used as inheritance
4. If the royal family was exempt, everyone should. Any law that is for some only is an unfair law that should not exist
Have to pay tax. Part of your estate.
how about capital gains? if we inherit property from a parent then sell property on?
Should IHT be abolished? Yes - but at the next budget, Hunt should give priority to tackling 'fiscal drag'.
How has this changed in this weeks budget please?
What contract is inheritance tax?
All contracts belong to a trust.
1. Who founded the trust?
2. Who is the grantor?
Answer
1. The Agent. The agent who works for the state. The servant.
2. You are the grantor, you own the Res and the trust.
Stop fighting policy. Fight the declaration of the trust. The agent pledged the trust for you, and it then defined the trustee and beneficiary position on your behalf.
The owner can express their will on the trust.
So, just do that. Declare yourself as the beneficiary and the agent as the trustee.
Job done. And the agent imposing their will on your property is the trustee; they become liable.
Stop fighting policy and start fighting trusts.
If sons / daughters/ grandchildren inherited an estate upon a death in the UK, would they have to pay any capital gains tax?
So, in a nut shell. If our ( my wife and I)estate is valued at under £1m there will be no inheritance tax to pay of the estate goes to our children?
If it's over £1m does inheritance tax only kick in on anything over the £1m?
no everything over 500k when leaving to children is taxed at 40% soon to be 55% under starmer
so if your house sells for 1 mil they'll pay 275k tax, 55% of 500k
@@Foxingban that's absolutely disgusting.. government has no shame.
When my single parent mother bought the house it was under 100k and now looking at houses on my road for sale over recent years, its over 500k and looks like it will keep rising. It's my main residence. But that means I will need to pay inheritance tax and its not like we are wealthy. Surely a lot more people in London will be hit with IHT as low - average wage workers?
Londoner here. A lot of houses in London are affected. I've had to do IHT planning with a tax advisor as my parents own two houses both worth over a million. They bought one for about £80k and the second for £160k. London property has been insane.
@@stephen129 incredibly! My mother is with ill health now so I don't think gifting will amount to lowering the tax at this point but who knows. It was something I knew about years ago but I was much younger then and broaching the subject would have been difficult and it quite difficult now too. Much easier with my dad who was more pragmatic about things even when he passed. Sigh, adulting.
I could only afford a one bed flat in London on a low wage. Bought my 1 bed flat 40yrs ago. Can't afford to gift anything then or now retired. I can't afford to put heating now! Nil IHT if gifting 7 years before you die is ridiculous unless you are wealthy. As if we know when we are going to die?
If you inherit the house, you won’t pay IHT on the first £500k.
@@WalkWithWallace I know, but 40% of over that and houses around me are 545k- 575k and rising will cripple me as a single person on an average wage especially considering our house was like 82k when we bought it and its been our home since. for the average Londoner in this situation its quite worrying.
Hi Martin. thanks for the information. Have these rules changed at all since the labour government have got in?
What about leaving your inheritance to your siblings??
What about the government taking your estate to pay for care costs
Brilliant.
Excuse my ignorance, no inheritance tax for most estates, but equally important...
Will the heirs pay income tax on their inheritance is still baffling.
One thing I cannot find clear information relates to "gifts out of income" for a married couple where one of the couple does not work. The worker has a good income. Is the gifts out of income allowance £3000 (from the one who works), or £6000, as the working spouse can give money to his/her non working spouse so he/she can make a £3000 gift - all without affecting normal life style. In addition, if the couple want to splurge on an expensive holiday one year, but have to sell some stocks/shares to finance this, does this affect the gift allowance for that year?
This will very soon need a new video update.
How are remaining pension funds impacted by the Inheritance Tax?
What if you go to a nursing home?
Brilliant Martin xx
So 185 kids is the cut-off?