Only the little people pay taxes. 25-year-old inherits €10.5 billion tax free.

Billionaire Leona Helmsley is infamously recorded as saying, "We don't pay taxes. Only the little people pay taxes". And so it is with Britain's richest person, dying and leaving his whole estate tax free to his son. Legally.

Apparently, the little people in Britain pay 40% inheritance tax on everything above £325,000. In Ireland the first €280,000 is tax free (while imposing cutbacks on the rest of us, Fine Gael in October 2015 looked after its property-rich voters in south-east Dublin and increased the tax-free limit by €55,000, from €225,000 - it's no wonder inequality is growing faster than ever, and I write this as somebody who will benefit directly from that election stunt.)


Hugh Grosvenor (25) begins first weekend as billionaire

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Inheritance tax and the Dukes of Westminster

Is it time countries in the western world started putting serious taxes on the super rich, and particularly on inherited wealth (i.e. on people who contribute nothing in terms of work or initiative)? If they all do it, the rich won't have anywhere to escape to. Indeed, if they're like the 25-year-old above with the largest property portfolio in Britain it's highly unlikely they'll sell everything and move.

The_Valeyard

Nine billion.
Mind Boggles.
The damage I could do with that much money.

Jay D

Deleted User wrote: »

Apparently, the little people in Britain pay [url=https://www.gov.uk/inheritance-
[url=http://www.ft.com/cms/s/0/e94f6dde-
Is it time countries in the western world started putting serious taxes on the super rich, and particularly on inherited wealth (i.e. on people who contribute nothing in terms of work or initiative)? If they all do it, the rich won't have anywhere to escape to. Indeed, if they're like the 25-year-old above with the largest property portfolio in Britain it's highly unlikely they'll sell everything and move.

I'd like to agree but while our governments are super-greedy and super incompetent then what's the point? Ireland in particular is an absolute joke. So f*ck it really.

In fact what I'd much rather see is penalising for this sense of entitlement from freeloaders waiting on handouts that we see so often. Having a load of kids with no means of their own to support them. I think that would fix a lot more problems than taxing the super-rich to begin with.

Call me medieval.

Ruu

Fair play to them.

Irish Praetorian

At 40% I'm kinda not surprised people are figuring out ways around this, have these people not heard of a Laffer Curve?

54and56

I don't understand why someone who accumulates wealth, be it property or business interests, and pays income and all other taxes due during their ownership should then have the fruits of their labour pillaged just because they die and pass what they have accumulated onto their family.

If we make wealth creation a punitive exercise and demotivate people from starting businesses etc who's going to create the jobs we need to provide incomes for those who want to work?

Irish Praetorian

Je_suis_Jean wrote: »

I don't understand why someone who accumulates wealth, be it property or business interests, and pays income and all other taxes due during their ownership should then have the fruits of their labour pillaged just because they die and pass what they have accumulated onto their family.

If we make wealth creation a punitive exercise and demotivate people from starting businesses etc who's going to create the jobs we need to provide incomes for those who want to work?

Same reason why those people are asked to pay a portion of that wealth when they are in the process of earning it, be that by selling their labour or their assets; because the state needs the cash.

The problem here is that someone thought just under half of everything was a good rate that wouldn't cause problems when really it should be 10-15%.

Je_suis_Jean

No

Je_suis_Jean wrote: »

I don't understand why someone who accumulates wealth, be it property or business interests, and pays income and all other taxes due during their ownership should then have the fruits of their labour pillaged just because they die and pass what they have accumulated onto their family.

If we make wealth creation a punitive exercise and demotivate people from starting businesses etc who's going to create the jobs we need to provide incomes for those who want to work?

Wealth transfer (e.g. inheritance) is to somebody who has paid no tax on their newfound wealth. They have not created a single job, or had any fruits of any labour exercised in connection with that wealth. If somebody gives me €500,000 for a product I have made with my own initiative and energy, I will have to pay tax on this new wealth.

In this context, there is no reason why somebody who inherits - i.e. does no work at all - €500k or even €50 million should escape comparable (at the very least) taxes on their new income.

B.A._Baracus

Sorry for the stupid question, but if people who inherit £325,000 or more have to pay 40% how did he get this tax-free? amazing solicitor, right?

jcon1913

Je_suis_Jean wrote: »

I don't understand why someone who accumulates wealth, be it property or business interests, and pays income and all other taxes due during their ownership should then have the fruits of their labour pillaged just because they die and pass what they have accumulated onto their family.

If we make wealth creation a punitive exercise and demotivate people from starting businesses etc who's going to create the jobs we need to provide incomes for those who want to work?

Dont mistake loopholes for the mega wealthy as something you or I will ever benefit from. Mega wealthy people have the money to pay tax advisers to find loopholes. I dont and you prob dont. We need to get real and get all countries to change laws across the world to get everyone to pay their fair share including the mega wealthy.

Mint Aero

[Deleted User] wrote: »

Wealth transfer (e.g. inheritance) is to somebody who has paid no tax on their newfound wealth. They have not created a single job, or had any fruits of any labour exercised in connection with that wealth. If somebody gives me €500,000 for a product I have made with my own initiative and energy, I will have to pay tax on this new wealth.

In this context, there is no reason why somebody who inherits - i.e. does no work at all - €500k or even €50 million should escape comparable (at the very least) taxes on their new income.

Thanks for underlining and making bold the key points of what you were trying to say. If only everyone did this so the thickos could understand such intelligent posts.

duffman13

[Deleted User] wrote: »

Wealth transfer (e.g. inheritance) is to somebody who has paid no tax on their newfound wealth. They have not created a single job, or had any fruits of any labour exercised in connection with that wealth. If somebody gives me €500,000 for a product I have made with my own initiative and energy, I will have to pay tax on this new wealth.

In this context, there is no reason why somebody who inherits - i.e. does no work at all - €500k or even €50 million should escape comparable (at the very least) taxes on their new income.

A family home should be exempt being perfectly honest, anything above this I can understand being subject to tax but 40% tax is ridiculous.

If I was inheriting a big sum (500k +) id see an advisor. They don't cost an arm and a leg and they find perfectly legal ways to reduce your tax liability. If anyone is earning above the lower tax threshold id recommend seeing a financial advisor or and accountant as they can often save you a few quid long term.

Vic_08

Jay D wrote: »

I'd like to agree but while our governments are super-greedy and super incompetent then what's the point? Ireland in particular is an absolute joke. So f*ck it really.

Yeah, much better that we have the working poor and those just about keeping their finances in order by working their arses off all their lives pay rather than the super rich.

Jay D wrote: »

In fact what I'd much rather see is penalising for this sense of entitlement from freeloaders waiting on handouts that we see so often. Having a load of kids with no means of their own to support them. I think that would fix a lot more problems than taxing the super-rich to begin with.

Call me medieval.

The top 1% use every trick to avoid paying, the bottom 10% stand with the begging bowl proclaiming their hooman rights and everyone else in between gets the bill.

Chromosphere

No

This is actually far more extreme than just your typical inheritance. It's pretty much what remains of the feudal system. All of those lands were inherited and passed down a long line of aristocrats' families for centuries.

Basically what you're looking at is the British class system in action and it's one of the reasons I am very glad we left the UK. For all the outward appearances of a modern society, the UK is still almost feudal when it comes to how land is owned.

This kind of thing is nothing to do with accumulation of wealth from business or from enterprise, it's just pure privilege based on family lines and a formalised, legally protected class system.

KingBrian2

It is quite sickening how unequal the economies of the world have become. We are seeing good results in China, India and sprinkle of other part of the globe but the extremely rich are still creaming off the top and that is due to how easy it is for them to exploit the stock markets of the world building up their portfolios profiting from owning vast shares, assets & resources.

Mint Aero

No

Mint Aero wrote: »

Thanks for underlining and making bold the key points of what you were trying to say. If only everyone did this so the thickos could understand such intelligent posts.

Glad to assist and kudos for managing to finish it all.

duffman13

No

duffman13 wrote: »

A family home should be exempt being perfectly honest, anything above this I can understand being subject to tax but 40% tax is ridiculous.

If the family home is worth €5 million or so, I'd have to disagree. Indeed even if it's worth €200,000 it's hard to justify somebody receiving €200k in income (via inheritance) and not being taxed when a person who receives €200k in income from her work must be taxed.

KingBrian2

I'd say a lot of this wealth causes distortions in the economy. When someone really rich dies and the wealth which has accumulated over decades suddenly is transferred to the inheritors you get a lot of persons with a lot to spend with no insight into how to invest this income or the best way to keep track of all properties, resources that this person now owns. Before you know it you get a lot of billionaires with mansions littering the countryside wasting away the potential to actual use that wealth for worthwhile pursuits.

ProudDUB

Deleted User wrote: »

If the family home is worth €5 million or so, I'd have to disagree. Indeed even if it's worth €200,000 it's hard to justify somebody receiving €200k in income (via inheritance) and not being taxed when a person who receives €200k in income from her work must be taxed.

But the person who originally owned the house, paid tax on their earnings, so if they leave it to their child & the child has to pay tax on it, then their parent is being taxed twice. That's not fair.

Last year, my aunt died and left her house to her daughter. It was a bog standard 3 bed semi, but as it was in the good part of Castleknock, it was worth over 600,000. If her daughter wanted to move into her old family home, with her family (which she really wanted to do) she would have had to cough up over 100,000 inheiritance tax to the government. She couldn't, so the house was sold. That's not right.

Am all for multi millionaires having to pay their share, but plenty of ordinary people get stung too. Especially Dubs, where the property values are so much higher than else where.

Capt'n Midnight

Je_suis_Jean wrote: »

I don't understand why someone who accumulates wealth, be it property or business interests, and pays income and all other taxes due during their ownership should then have the fruits of their labour pillaged just because they die and pass what they have accumulated onto their family.

If we make wealth creation a punitive exercise and demotivate people from starting businesses etc who's going to create the jobs we need to provide incomes for those who want to work?

The main ways they accumulate wealth is by not paying tax on it and by wealth transfer from the poor.

They are enjoying the fruits of others labour, not their own. And mostly indirectly because the tax burden gets pushed on to wage earners.


If you are wondering where the value of your house and reduction in wages went to because of the recession ? It's gone to the super rich.

The number of billionaires who have the same combined assets of the poorest half of humanity has dropped from 400 to 82 in recent years.

If the richest 100 people had to pay tax on their increased income during the recession set at a rate matching USC / increases in PRSI that everyone even those on minimum wages had to pay then we could have eliminated extreme poverty globally.



If the super rich paid the same sort of levels of tax on their income that we do then maybe more of us could maybe accumulate some wealth or start businesses. Instead most startups go bust within a few years because paying tax means it's very difficult to compete with multinationals who don't.

ProudDUB

No

ProudDUB wrote: »

But the person who originally owned the house, paid tax on their earnings, so if they leave it to their child & the child has to pay tax on it, then their parent is being taxed twice. That's not fair.

But they're really not; they've died. A different person, the child, is being taxed on this because it is new income to them. In the same way a working person is taxed on new income he receives.

ProudDUB wrote: »

Last year, my aunt died and left her house to her daughter. It was a bog standard 3 bed semi, but as it was in the good part of Castleknock, it was worth over 600,000. If her daughter wanted to move into her old family home, with her family (which she really wanted to do) she would have had to cough up over 100,000 inheiritance tax to the government. She couldn't, so the house was sold. That's not right.

Why not? It's a building. Home is a very different, intangible thing. The daughter in effect received an income of €600,000 - and fair play to her - and the government has very kindly said she has only to pay tax on €320k of her income. In other words, she has received an income of €280k tax free. How many people are allowed to have €280k of their income from their actual work tax free?

ProudDUB

Deleted User wrote: »

But they're really not; they've died. A different person, the child, is being taxed on this because it is new income to them. In the same way a working person is taxed on new income he receives.

Why not? It's a building. Home is a very different, intangible thing. The daughter in effect received an income of €600,000 - and fair play to her - and the government has very kindly said she has only to pay tax on €320k of her income. In other words, she has received an income of €280k tax free. How many people are allowed to have €280k of their income from their actual work tax free?

Family homes should be exempt imo, precisely because they are family homes imo. People have a connection to them, that they don't to other pieces of bricks and mortar. A family owning a similar home in Longford or Leitrim would have had to pay eff all inheritance tax. How is that fair?

A massive part of her parents income over 35 years, went on paying off the mortgage on the house, so they they could provide a home for their children. But then when they die, the government take another massive chunk of their asset, to such a degree that the house passed out of the family. It's not right, not when its the family home.

Princess Consuela Bananahammock

Deleted User wrote: »

But they're really not; they've died. A different person, the child, is being taxed on this because it is new income to them. In the same way a working person is taxed on new income he receives.

But he's NOT receiving an income - he's receiving an asset. If he sells it or rents it out, then he's in receipt of an income and will be taxed on it.

Why not? It's a building. Home is a very different, intangible thing. The daughter in effect received an income of €600,000 - and fair play to her - and the government has very kindly said she has only to pay tax on €320k of her income. In other words, she has received an income of €280k tax free. How many people are allowed to have €280k of their income from their actual work tax free?

These are exactly the people inheritance tax laws are intended to protect: if you use the asset for you own personal use and make no profit from it, why should you pay tax on money you're not earning?

ProudDUB

No

ProudDUB wrote: »

Family homes should be exempt imo, precisely because they are family homes imo.

But they're not "family homes" if the parents have passed away and the children have their own lives, their own families.

ProudDUB wrote: »

People have a connection to them, that they don't to other pieces of bricks and mortar.

People live in expensive houses all the time, and in nearly all cases they have to sell them because their (taxed) income cannot sustain them. Should they have a right to live there in perpetuity because they have a connection to them? It's a recipe for creating greater inequality.

Moreover, should a person in an expensive house receive an enormous amount of income (in the form of inheritance) and not pay tax on it, while somebody who earns the same income by actually working/contributing to society is taxed heavily on it?

ProudDUB wrote: »

A family owning a similar home in Longford or Leitrim would have had to pay eff all inheritance tax. How is that fair?

This is an obviously silly comparison. I'm sure anybody inheriting in either county would love the problem of their house being worth enough to be liable to the inheritance tax which faces the son or daughter of somebody on Shrewsbury Road or Cross Avenue.

kowloon

No

What happens to an 18 year old who inherits the family home, do they have to pay tax on the home they're living in and have inherited or are allowances make for them?

ProudDUB

Deleted User wrote: »

But they're not "family homes" if the parents have passed away and the children have their own lives, their own families.

People live in expensive houses all the time, and in nearly all cases they have to sell them because their (taxed) income cannot sustain them. Should they have a right to live there in perpetuity because they have a connection to them? It's a recipe for creating greater inequality.

Moreover, should a person in an expensive house receive an enormous amount of income (in the form of inheritance) and not pay tax on it, while somebody who earns the same income by actually working/contributing to society is taxed heavily on it?






This is an obviously silly comparison. I'm sure anybody inheriting in either county would love the problem of their house being worth enough to be liable to the inheritance tax which faces the son or daughter of somebody on Shrewsbury Road or Cross Avenue.

Where did I mention two of the most expensive roads to live on in the country, that have some of the biggest and poshest houses in the country? Nowhere is where.

I'm talking about a very average, 3 bed semi detached house, the type that can be seen all across the bog standard housing estates of Ireland. The daughter is a teacher and her husband is a Guard. They are two very ordinary people, with two very ordinary jobs and lives. They have committed the crime of wanting to live in her old family home, to be close to other family members and remain a part of a community that they both grew up in. I'm not talking about two shyster Anglo bankers who spent their lives buying up all the D4 mega mansions, as they gave two fingers to the little people. They are the little people !

Donald Trump

ProudDUB wrote: »

Deleted User wrote: »

But they're really not; they've died. A different person, the child, is being taxed on this because it is new income to them. In the same way a working person is taxed on new income he receives.

Why not? It's a building. Home is a very different, intangible thing. The daughter in effect received an income of 600,000 - and fair play to her - and the government has very kindly said she has only to pay tax on 320k of her income. In other words, she has received an income of 280k tax free. How many people are allowed to have 280k of their income from their actual work tax free?

Family homes should be exempt imo, precisely because they are family homes imo. People have a connection to them, that they don't to other pieces of bricks and mortar. A family owning a similar home in Longford or Leitrim would have had to pay eff all inheritance tax. How is that fair?

A massive part of her parents income over 35 years, went on paying off the mortgage on the house, so they they could provide a home for their children. But then when they die, the government take another massive chunk of their asset, to such a degree that the house passed out of the family. It's not right, not when its the family home.

I think that homes are fully exempt.

If the home that you are living in is bequeathed to you, and ownership passes to you, I think you might be 100% exempt from the tax.

What you are talking about is their parents' home. Every home is a "family home" if someone lives in it!

The daughter was living somewhere else. She could have sold the other home, moved into the fancy house and had a nice chunk of change left over. If she didn't have a house somewhere else, well she was getting a house in a fancy area for 100k.

Donald Trump

Donald Trump wrote: »

ProudDUB wrote: »

Deleted User wrote: »

But they're really not; they've died. A different person, the child, is being taxed on this because it is new income to them. In the same way a working person is taxed on new income he receives.

Why not? It's a building. Home is a very different, intangible thing. The daughter in effect received an income of 600,000 - and fair play to her - and the government has very kindly said she has only to pay tax on 320k of her income. In other words, she has received an income of 280k tax free. How many people are allowed to have 280k of their income from their actual work tax free?

Family homes should be exempt imo, precisely because they are family homes imo. People have a connection to them, that they don't to other pieces of bricks and mortar. A family owning a similar home in Longford or Leitrim would have had to pay eff all inheritance tax. How is that fair?

A massive part of her parents income over 35 years, went on paying off the mortgage on the house, so they they could provide a home for their children. But then when they die, the government take another massive chunk of their asset, to such a degree that the house passed out of the family. It's not right, not when its the family home.

I think that homes are fully exempt.

If the home that you are living in is bequeathed to you, and ownership passes to you, I think you might be 100% exempt from the tax.

What you are talking about is their parents' home. Every home is a "family home" if someone lives in it!

The daughter was living somewhere else. She could have sold the other home, moved into the fancy house and had a nice chunk of change left over. If she didn't have a house somewhere else, well she was getting a house in a fancy area for 100k.

Edit button isn't working. Admins fix the crappy new site

I meant homes are fully exempt if it IS your home!

kowloon

No

kowloon wrote: »

What happens to an 18 year old who inherits the family home, do they have to pay tax on the home they're living in and have inherited or are allowances make for them?

Obviously he should have to pay tax on his newfound wealth. With his inheritance he will still be much better off financially than most people his own age and if he cannot afford to live in that house he can sell it and purchase an alternative residence.

Donald Trump

Deleted User wrote: »

Billionaire Leona Helmsley is infamously recorded as saying, "We don't pay taxes. Only the little people pay taxes". And so it is with Britain's richest person, dying and leaving his whole estate tax free to his son. Legally.

Apparently, the little people in Britain pay 40% inheritance tax on everything above 325,000. In Ireland the first 280,000 is tax free (while imposing cutbacks on the rest of us, Fine Gael in October 2015 looked after its property-rich voters in south-east Dublin and increased the tax-free limit by 55,000, from 225,000 - it's no wonder inequality is growing faster than ever, and I write this as somebody who will benefit directly from that election stunt.)


Hugh Grosvenor (25) begins first weekend as billionaire

Duke's 9bn inheritance prompts call for tax overhaul

Duke s death hands property empire to 25-year-old son

Inheritance tax and the Dukes of Westminster

Is it time countries in the western world started putting serious taxes on the super rich, and particularly on inherited wealth (i.e. on people who contribute nothing in terms of work or initiative)? If they all do it, the rich won't have anywhere to escape to. Indeed, if they're like the 25-year-old above with the largest property portfolio in Britain it's highly unlikely they'll sell everything and move.

I don't know the details here but I am assuming that there is some kind of trust set up so that legally the son doesn't "own" the assets. He may have some, or almost full, control over them but he probably doesn't technically own them.

He will get the income from them, and be taxed off that income. But the assets themselves are probably "owned" by the Trust. The average person could do the same thing, it just wouldn't be worth the effort, or practical to set it up.


I think that inherited or gifted wealth should definitely be taxed. Suppose there is a millionaire with two twin sons. Neither are much good for anything and one is exceptionally lazy. He sets up a company to give the first one something to do and the company pays the son a nominal wage of 100k a year. Nominal in the sense that he doesn't actually earn it. He just hands the lazy son 100k into his hand. People want the second one to get off tax free?

Slightly modified example where the millionaire hands his son the same "pocket money" every year as you earn gross. You don't want him to be taxed on his income?

ProudDUB

No

ProudDUB wrote: »

They have committed the crime of wanting to live in her old family home, to be close to other family members and remain a part of a community that they both grew up in.

You're essentially talking about a huge number of people in southeast Dublin who would also like to live in if not the "old family home" in the same area as their parents. Why should somebody be given a tax-free inheritance to skip this very long queue of taxpayers who have a similar aspiration?

Again, no amount of emotion will detract from the essence: if somebody who earns €500k has to pay tax on it, somebody who did no work/inherits property worth €500k definitely should be paying tax on it. To contend otherwise is an injustice to people who actually work.