Why inheritance is the dirty secret of the middle classes – harder to talk about than sex

https://www.boards.ie/discussion/comment/119956011#Comment_119956011

The person who earned it paid tax. They can give it to who they want. The government got their cut already.

Allinall

https://www.boards.ie/discussion/comment/119956021#Comment_119956021

Earned income is taxed at different rates.

there are specific exemptions for lottery and competition wins. Same for gambling wins.

One eyed Jack

https://www.boards.ie/discussion/comment/119955977#Comment_119955977

It’s not all technicality at all. Jobseekers benefit is an income which is taxed in the same way as income from PAYE employment. In a similar fashion, inheritance is considered income which is taxable with those who benefit claiming they’re paying too much in taxes when they inherit property or goods valued above the existing thresholds which means they pay 30 odd % on anything over I think it’s €300k.

That’s I think what the article is driving at in suggesting that inheritance is a dirty word among the middle classes. I’ve seen how among members of my own family they’re circling like vultures around the family home waiting for my mother to pop her clogs. Had I my way, I’d raze the property to the ground.

Allinall

https://www.boards.ie/discussion/comment/119956026#Comment_119956026

The wages you get from your employer have already been taxed when your employer earned it.

all money is taxed multiple times.

https://www.boards.ie/discussion/comment/119956023#Comment_119956023

Are you serious?

Princess Consuela Bananahammock

https://www.boards.ie/discussion/comment/119956034#Comment_119956034

Again - NOT an income.

The rest of this is true, but none of it addresses the issues raised or answers the questions I asked (some of it even agrees with me).

Donald Trump

https://www.boards.ie/discussion/comment/119956047#Comment_119956047

Yes, deadly serious. It is true. I am surprised you didn't know it

https://www.boards.ie/discussion/comment/119956038#Comment_119956038

Word salad. You contribute or take. Often both at some stage in your life.

The basics of this whole debate is people trying to take more, off those of have died.

thegame983

Whether it's the money in your pocket, your payslip, your savings account or possible inheritance, the powers that be are working tirelessly to take it from you and give it to private interests.

The less you have, the more they have.

Donald Trump

https://www.boards.ie/discussion/comment/119956053#Comment_119956053

Nothing is taken off people who died. When you are dead, you no longer own anything and have nothing to take. It is an impossibility.

It might be taken off beneficiaries. The tax paid depends on the beneficiary and their lifetime allowances etc. It has no reference to the deceased.

https://www.boards.ie/discussion/comment/119956044#Comment_119956044

No. The wages I get off my employer are off what my employer has left after their taxes. It’s not the same money taxed again.

Donald Trump

https://www.boards.ie/discussion/comment/119956059#Comment_119956059

When you get a job someday you will learn all about it. You will indeed find that you are taxed on that income.

In fact, for the money paid to you by your employer, he will likely not have his income tax deducted from it.

Still stihl waters 3

https://www.boards.ie/discussion/comment/119955969#Comment_119955969

I've never met anyone who pays tax on nixers, do you really declare nixers lol

Donald Trump

https://www.boards.ie/discussion/comment/119956068#Comment_119956068

No. I don't do nixers. It was a hypothetical question

"lol"

https://www.boards.ie/discussion/comment/119956058#Comment_119956058

If it’s mine when I’m alive and I want to give it to my kids it’s the same outcome if it’s taken off me or my kids it doesn’t matter and is purely a technicality. It’s taken off what I have made and it’s you who wants to take it. As usual to prop of those who have made nothing.

eggy81

They should just legalise drugs. That’s where the killing is to be made.

One eyed Jack

https://www.boards.ie/discussion/comment/119956053#Comment_119956053

Word salad you say, and then follow up with “you contribute OR take, often both at some stage in your life”. Your point is meaningless, we’re all aware that we give and take and all the rest of it. I didn’t have to pay for my education for example, funding for education is provided for by the State out of public funds, which are paid into out of general taxation, including income tax, inheritance tax, corporation tax.

It’s how a society functions, by wealth redistribution. The basics of this debate is get rid of your wealth while you’re alive and pass it onto your children and grandchildren in the most tax efficient way possible, and then they won’t be hit with an enormous tax burden on their inheritance when you do pop your clogs!

Still stihl waters 3

https://www.boards.ie/discussion/comment/119956078#Comment_119956078

Oh right, silly hypothesis in fairness as no one pays tax on nixers lol

Donald Trump

https://www.boards.ie/discussion/comment/119956082#Comment_119956082

No it's not.

If you have a 500k house and leave it to one child, that child will be liable to a small tax.

If you have a 500k house and you leave it to two children, neither will pay any tax (unless they already exhausted their lifetime allowances)

The tax system doesn't give a bollix what your, the now dead person, circumstances are or were. You're dead. You can't own anything. It is all now in your estate

https://www.boards.ie/discussion/comment/119956064#Comment_119956064

When I get a job someday? Can you not just argue your point of view?

Donald Trump

https://www.boards.ie/discussion/comment/119956091#Comment_119956091

Depends on the "nixer". Plenty of people make a lot from them. Depends on your definition of the word though. You can define it as something where no tax is paid if you want

Sure there is even the odd story about teachers getting stung over giving grinds. Never mind fellas on the dole and, in reality, putting up extensions.

Not all nixers are cash-in-hand either.

Strumms

https://www.boards.ie/discussion/comment/119955990#Comment_119955990

As regards inheritance, yes completely..

because tax has been earned, taxed.

Donald Trump

https://www.boards.ie/discussion/comment/119956107#Comment_119956107

Someone else paid tax on that income. Now it's the beneficiaries turn

Princess Consuela Bananahammock

https://www.boards.ie/discussion/comment/119956095#Comment_119956095

Hang on - are you arguing in favour of or against tax here....?

Also - how do you pay tax on an asset without liquidising the asset?

https://www.boards.ie/discussion/comment/119956088#Comment_119956088

More word salad. You don’t really say anything. Tax is part of society and vital to society. What should and shouldn’t be taxed is the discussion here.

https://www.boards.ie/discussion/comment/119956119#Comment_119956119

You mean now it’s the governments turn to take again.

magicbastarder

i think it's been mentioned several times already, but i suspect the main reason this would be an issue for some in ireland is a result of our dysfunctional property system, as i suspect most examples of people paying inheritance tax is on property. if houses weren't so falsely expensive, a good proportion of those who have paid tax probably wouldn't have breached the threshold to pay.

anyway, my attitude to anyone complaining about inheritance tax can be boild down to - boo hoo, your dad gave you 400k and you've to pay €21k in tax. life's not fair.

i pay tax at the top rate of money i've worked to earn. why shouldn't i pay tax on money i didn't work to earn?

elperello

Interesting discussion but you are really only dealing with the crumbs off the inheritance table.

The real wealth owned by the truly rich tends to be well protected by a phalanx of lawyers and accountants and is handed down pretty much intact.

Trust funds, off shore accounts and extensive land/property holdings are to large extent bullet proof.

Donald Trump

https://www.boards.ie/discussion/comment/119956151#Comment_119956151

I was explaining to the poster why it is not the dead person who is getting taxed (as they appear to think)

There is no law forcing you to liquidise an asset. There are other mechanisms by which you can acquire money besides being gifted it from your parents. You could, for example, have a job which pays you money and you could use that money to pay inheritance tax.

One eyed Jack

https://www.boards.ie/discussion/comment/119956159#Comment_119956159

Paying tax on inherited wealth isn’t up for negotiation though, not sure what you think there is to discuss? If someone inherits assets from another, they may have to pay tax on that asset. They didn’t have to pay tax on it before, because it wasn’t theirs.

The idea that their parents or grandparents paid taxes on the asset while they benefited from the ownership of said assets, means nothing as far as whether or not the person who inherits the asset should have to pay tax on it now that they own it and and benefit from ownership of the asset.

It’s why people are encouraged to pass on their assets while they are still alive, to reduce the amount of tax the person who inherits the assets will have to pay upon their inheritance when the person dies.

It’s not word salad, it’s pretty basic economics. That’s why it’s a good idea to make a will too - so that you can decide within the bounds of Irish law how your estate is to be distributed upon your death, seeing as you can’t take it with you.

Brian201888

I'd be very happy to see the tax free threshold for inheritance tax abolished and it all taxed at the recipients marginal rate .

It's nonsense that it should be treated differently, it's income to those who receive it and I say this as someone who it seems will have considerably less issues planning for retirement when I receive inheritance from my parents.

Donald Trump

https://www.boards.ie/discussion/comment/119956179#Comment_119956179

No. It will be the first, and only time, the beneficiary pays taxes on that windfall.

Princess Consuela Bananahammock

https://www.boards.ie/discussion/comment/119956210#Comment_119956210

Problem there is that you're assuming either a) the inheritance is cash; or b) the person inheriting already has substantial cash reserves.

What if they inherit the family house and decide they want to move into it and live there? They have to stump up for the privilege? What percentage do you think they should be paying on the inheritance?

joseywhales

https://www.boards.ie/discussion/comment/119955814#Comment_119955814

Sorry what? Who is coughing up 33%? You are receiving 66%. You didn't earn it!

Even from an purely economic perspective, you want to reward merit(output) so that you increase the overall output of the country. But here we have an unfair advantage that is uncompetitive and reduces the potential of the country as a whole.

Its not right morally or practically.

Donald Trump

https://www.boards.ie/discussion/comment/119956229#Comment_119956229

If they are smart, and move into the house before the parent passes away, they inherit it all tax free.

If you don't plan, and you inherit a very valuable house which you want to move into, you won't need your own house and can sell that if you want. If you are in your 50's and don't have a house or any savings and you inherit a 3 million Euro house for example, then maybe it would be better for you to liquidate it anyway

It's 33% on the value about 350k or thereabouts. A person inheriting the average house will pay very little.

It’s clear some don’t like the thought of inheritance, perhaps it is more prevalent in those that won’t get any, or don’t think their kids deserve it. It is worth remembering that IHT is most often a tax on middle class savings rather than on the wealth of the super rich being handed down multiple generations.

My view would be, is the State more entitled to the fruits of the working middle class than their children are, and if so, why? Have we not earned the right, after paying tax all our lives, not to be charged a further tax just because we have died?

magicbastarder

https://www.boards.ie/discussion/comment/119956229#Comment_119956229

if they want to be given a house they don't already live in, and can't afford the tax, tough.

under the current regime, the tax on the 'worst case' scenario for a 500k property (which is well above the national medium) is approx 10% the value of the property.

magicbastarder

Have we not earned the right, after paying tax all our lives, not to be charged a further tax just because we have died?

AGAIN, the tax is not charged on the deceased (or the benefactor).

One eyed Jack

https://www.boards.ie/discussion/comment/119956248#Comment_119956248

It’s not a tax on middle class savings though, it’s a tax that everyone is obligated to pay based upon the fact that they have inherited an asset which is considered an income - everyone pays tax on any income received.

The State is entitled to tax, the children or grandchildren or their spouse or whomever is the beneficiary of the inheritance is the person who is obligated to pay any outstanding taxes, not the person who has died, and because nobody who has died is paying any further tax, the idea of the right not to pay any further taxes just doesn’t arise.

Fuascailteoir

The vast vast majority of people use solicitors to go through the probate process. They actually take a percentage of the total estate as well. Even down to the value of cars. Total parasites. They try to make the probate process appear difficult to try to avoid people doing it themselves

Princess Consuela Bananahammock

https://www.boards.ie/discussion/comment/119956239#Comment_119956239

This is bizarre logic.

First off, you're going for an ideal world as a cop out - assuming that it's somehow possible to predict the death of a parent (or blaming people for bad planning if the death was sudden) and even then you're condoning inheriting without tax while trying to argue for the exact opposite in the first place....?

Then you're advising people to sell off the house they already own (eh???!) and telling people that they should actually have to pay 1 million euro to move into a house that they legally already own....?? That's actually beyond bizarre.

And even 33% of 350k is something in the region of 115,000 euro. Not everyone has that kind of cash lying around - what makes you think they do??

The only think I can take from this post is that you seem to be of the belief that everyone who inherits either already owns houses or has hundreds of thousands of cash on hand. At which point I've proven the flaws in your thinking that I highlighted in my initial post.

Problem there is that you're assuming either a) the inheritance is cash; or b) the person inheriting already has substantial cash reserves.

joseywhales

https://www.boards.ie/discussion/comment/119956248#Comment_119956248

I guess I don't get this concept. You are dead, how can you be taxed?

Also why do you care, your existence has ended, thats a bit more profound than worrying about where the money goes. Maybe that's just the way I see it.byhe world can end one second after I die for all I care, or you can all discover immortality, none of my business anymore.

Ill take your point, the only people I think that argue against inheritance tax are those that would benefit. I will get something, I don't want it, I'd rather they spend every last cent that they can. I'd happily do without it if everyone else does.

Donald Trump

https://www.boards.ie/discussion/comment/119956283#Comment_119956283

1) You don't need two houses. If you inherit a house that you want to live in, you won't need your current house.

2) I think you misunderstand the basics. If you inherit the 350k house from your parents, you will pay zero tax on it.

The idea behind 100% relief for inheriting a house if living in it, is not for a person to cynically guess when their parent will die so that they can move in in time. It is meant for people who are genuinely living in a house and sharing with a parent so that they can keep living there. If you have your own house, then it isn't aimed at you

Princess Consuela Bananahammock

https://www.boards.ie/discussion/comment/119956253#Comment_119956253

Why "tough"? A citizen aquires something for their own private use - why should the government get a say in how it's used?

elperello

How about we just tax money and property involved in commercial transactions?

magicbastarder

why not 'tough'? it's not their home. they still benefit massively from selling it.

if they've been living in the house anyway, they get it for free. if they've not been living in the house, they're clearly living somewhere else and have just been given a house they don't occupy and previously did not own.

whatever the arguments are against inheritance tax, this example is not one of them.

Princess Consuela Bananahammock

https://www.boards.ie/discussion/comment/119956295#Comment_119956295

I've delt with no 1 more than once, I'm not dealing with it again.

Regarding no. 2 - aren't you arguing that the recipient should have to pay the 33% tax in this scenario? or have I picked you up wrong?

Example: I pay rent and live on a modest income, I own no other properties - my parents pass away leaving me their house - I want to cancel my lease and move into what is now my legally owned house - you're saying I should pay 1/3 of the value of the house to revenue to do this - yes or no?

Newspaper with posh (but liberal, so it's ok) readership and writers, complaining about the middle class. Again.

Plus ça change.

sameoldname

https://www.boards.ie/discussion/comment/119956283#Comment_119956283

Either take out a loan to pay off the tax (you now have an asset you can secure that loan against) or if you can't afford the repayments sell the house and use the remainder to buy a smaller house. At a minimum you've gained €335,000 + 67% of anything over that.

I really don't get it, am I supposed to feel sorry for the small amount of people in this situation beyond feeling sorry for the death of their loved one? Like, having to sell the family home, if it comes to that, isn't great in an emotional sense but as far as real problems go, it's not high up there compared to say, never being able to afford a home at all.

https://www.boards.ie/discussion/comment/119956289#Comment_119956289

The concept is that parents who will leave an inheritance to their children tend to think about, and plan for this prior to death, and, are entitled to consider it unfair that what they have saved after tax, is going to be taxed again when their children inherit it. I appreciate that you may have the luxury of not being too interested in benefitting from inheritance now, but perhaps when you are older and have something of value to leave to your own children, you will give more consideration to it