1 in 10 inherited their home

bad2thebone

https://www.boards.ie/discussion/comment/119997540#Comment_119997540

That's exactly what I did, took out a small mortgage to upgrade the house I was left.

I wouldn't say I'm wealthy, but more or less comfortable.

Was only talking about a guy with a friend today who was left a huge wad of money in 1999 bought an expensive sport's car and wrote it off the following Christmas. He was a factory worker, FFS you can't live in a Porsche.

Many a guy pissed,spunked and snorted away inheritance within 6 months or less.

Imagine the emotional hangover from stupid financial decisions.... absolutely horrific

Claw Hammer

https://www.boards.ie/discussion/comment/119999544#Comment_119999544

A lot of families have a cute hoor member who will hang in to inherit the house, particularly if there is a farm as well.

ahnowbrowncow

https://www.boards.ie/discussion/comment/119999801#Comment_119999801

Lots of people have to move and live in different areas. People living in rural areas often leave and move to Dublin/other cities as there weren't jobs close to home.

Many people who were born and lived in Dublin their whole life have moved to commuter counties as they couldn't afford a house in Dublin.

These people have to do it without being able to sell a property for nearly half a million.

The Spider

https://www.boards.ie/discussion/comment/119999936#Comment_119999936

I’m not from Dublin, but I lived there for years, I’ve moved to a coastal town a long time now, my point is there are a lot of people in working class areas that have become ‘gentrified’ and forcing them out seems wrong when they were there for generations.

I know the original comment was full of begrudgery as is the Irish way and aimed at people from the more salubrious neighbourhoods of Dublin.

timmyntc

https://www.boards.ie/discussion/comment/119999936#Comment_119999936

My parents worked hard to afford a house of their own - why shouldnt they get to leave it to myself or my siblings without the government taking a significant cut?

Why can I not leave the family home to my children without the government interfering and looking for their pound of flesh?

Its fundamentally different to people moving outside the capital for work reasons. For starters, what about people who lived in with their parents, then when the parent passes away all of a sudden they can owe a big inheritance bill or they have to sell the family home that they have been living in too!

magicbastarder

again, there's that dichotomy between 'worked hard and deserved it'; and the fact that the recipient of someone receiving this large bequest didn't work hard to earn it.

or; we're more OK with the concept of taxing the income from hard work than we are taxing the income 'earned' by our parents dying.

OEP

https://www.boards.ie/discussion/comment/120000080#Comment_120000080

Inheritance tax is probably the fairest way of redistributing wealth. You don't do anything to earn inheritance it's completely by the lottery of birth. The same people complaining about inheritance tax will complain about people not working for their money - yet you don't work for your inheritance. It's only relatively well off people that end up having to pay any tax, and you still get 300 odd grand tax free and then pay 33% on anything over that.

herbalplants

https://www.boards.ie/discussion/comment/120000238#Comment_120000238

And why should people not allowed to inherit free of tax! Why!

I pay high tax and wish to leave my kids the house free of tax, why not! Why shouldn't I want for my kids to inherit my house free of tax. Didn't I pay enough tax so far without getting ever anything for it!

You tell me why is it so hard to understand that it is a stupid tax. A tax that most countries don't have.

Can anyone find other countries with more stupid inheritance tax than Ireland please.

John_Rambo

What's the story with corporation houses passed down from one generation to the next? There's a small ex-corporation housing estate close to me that's become popular with wealthy young families and there's a good few families now dwelling in the house that was originally their parents house worth close to a shocking 700k. (I don't begrudge them, I think it's fantastic that they, unlike a lot of Dubliners and popular rural areas popular for holiday homes can stay in the area they grew up in)

whatawaster

https://www.boards.ie/discussion/comment/120001130#Comment_120001130

You can inherit €335,000 tax free! I'm really not sure what the drama is.

If someone's being left more than that, lucky them! They can pay the relatively small amount of overall tax (relative to the overall value of the inheritance) or they can sell the asset. Maybe not what they wanted, but no great tragedy. They are still in a vastly more fortunate situation than 90% of the population.

I think we are right to place reasonable limits on people's ability to accumulate wealth tax free.

StupidLikeAFox

https://www.boards.ie/discussion/comment/120001588#Comment_120001588

If you inherit a house from a parent worth 700k your inheritance tax bill would be around 100k - an extremely small mortgage for such a prime property. An incredible leg up in life that 90% of people don't get. These people will realistically be mortgage free in a few short years, I'm not going to have sympathy for anyone in that position tbh

Strumms

a property isn’t wealth though. It’s an object…. A home…We have to view inanimate objects as wealth ? No.

as I said before, the government will already have had a grab of that money enabled from that home existing multiple times.

property tax, tax on every purchase that furnished it. Tax on every cent spent to heat it, light it, power it, repair it…stamp duty…

if a parent dies and say a house worth 400,000 is left to two children…. ?

fûck all ethical about a government throwing their snouts in the trough again for another feast….

the owners will have paid a lifetime of tax and the young inheritors likely to have furnished the state with hundreds of thousands in tax revenue between them.

leave people with what is given to them. If you can’t run the country without such shenanigans. Why should people have to downsize ? 🙂

whatawaster

https://www.boards.ie/discussion/comment/120001938#Comment_120001938

If a 400k house is left to 2 children, there will be no tax payable. You only pay tax on inheritances from parent of over 335k

Strumms

https://www.boards.ie/discussion/comment/120001949#Comment_120001949

Factoring in cash assets and other property such as motor vehicles etc you very well probably will.

whatawaster

Can sell the car and use the cash to pay the tax bill in that case

Jmc25

https://www.boards.ie/discussion/comment/120001938#Comment_120001938

The argument re the parents already paid tax doesn't stand up when you consider that basically every cent in the country has been taxed multiple times - wages is taxed, when wages is spent on goods it's taxed further, when the seller of those goods makes a profit it's taxed again, and on and on it goes.

I get it though, people don't like paying tax on their inheritance. I don't like paying it to drive my car either. Such is life.

cruizer101

https://www.boards.ie/discussion/comment/120001994#Comment_120001994

Only if there is another 270k in assets they will start to pay tax.

For those who want rid of it, what tax do you propose increasing? You can't just magically get rid of a tax and not make up the shortfall elsewhere.

In terms of original topic have to say I'm surprised its as high as it is

herbalplants

https://www.boards.ie/discussion/comment/120002573#Comment_120002573

Countries like Sweden, Norway 0% inheritance tax, Denmark, Finland 15% tax. These countries are progressive with high salaries, who benefit of good cheap childcare, long maternity pay, etc. Free university, for sure Denmark you get paid to attend university. Yet these countries don't need to tax dead people on their homes. They must find it somewhere don't they! Maybe Ireland needs to rethink where they spend the tax money.

Geuze

Those countries have higher VAT and much higher income taxes, especially on low earners.

whatawaster

https://www.boards.ie/discussion/comment/120002621#Comment_120002621

Nobody is taxing dead people. They are dead.

They are taxing the living beneficiary, who is getting a windfall they did not earn. And even then, they are only being taxed if they get more than €335,000, which is a huge sum of money, which most people will never come close to inheriting.

So it's a wealth tax, and we are right to tax it. And the limits and exemptions are reasonable imo.

Claw Hammer

https://www.boards.ie/discussion/comment/120000080#Comment_120000080

Governments have to get tax from somewhere. Inheritated wealth is unearned by the recipient so there is a strong argument that it is fairer to have some inheritance tax rather than taxing earnings.

elperello

https://www.boards.ie/discussion/comment/120002750#Comment_120002750

It's not necessarily a sum of money.

It includes the family home.

Take a look at the Dublin property market and you will see how far the exemption goes.

whatawaster

https://www.boards.ie/discussion/comment/120002773#Comment_120002773

If it is the family home and it's worth more than €335k (and it's left to only one beneficiary) - 2 choices:

1. Keep it, live in it and pay the tax from savings or by re-mortgaging
2. Sell it and have bucketloads of cash

Neither a tragedy.

cfingers

https://www.boards.ie/discussion/comment/119999801#Comment_119999801

Well say for example someone inherits a house that is valued at €450,000 in the Smithfield- they will only have to pay €36k in inheritance tax.

If they still lived in the house at the time the person died they would not have to pay anything.

That €36k is 8% the value of the house.

The house has increased in value since the parents bought it for many reasons, one of the reasons is due to investment in public infrastructure that supports the house. eg Nearby Luas .

I don't think asking someone to pay €36k to account for the increased value of the house is much. Most people should be able to get a mortgage for this amount ( they might actually have to get a mortgage for slightly more as banks have a minimum I believe). If people are unable to pay this , I do think Revenue should look at the ability to take the money over a longer period of time, say €3.6k each year for 10 years.

elperello

https://www.boards.ie/discussion/comment/120002803#Comment_120002803

I didn't say there was tragedy involved.

We are discussing tax and either of your options involves paying some.

In option 1 the inheritor may not have savings or an income sufficient to enable them to pay a mortgage.

Option 2 means the house is gone from family.

magicbastarder

https://www.boards.ie/discussion/comment/120002621#Comment_120002621

in denmark, the example i found online suggests that someone on ~€57k p.a. takes home 56% of that. in ireland, someone on the same salary takes home approx 70% of that.

in finland, the tax rate on income between 29k p.a. and 83k p.a. is 67%.

https://en.wikipedia.org/wiki/Taxation_in_Finland

In Sweden, earnings above ~€60k p.a. are taxed at 60%.

https://en.wikipedia.org/wiki/Taxation_in_Sweden

Donald Trump

As I pointed out on the other thread, the people complaining about not being able to pass on what they work for are really trying to mask that they complaining they they might have to pay tax on what they receive themselves

Why do I say that? Well because with proper estate planning you can transfer a large amount wealth to your children completely tax free if that is really your concern. What a person might not be able to do, would be to get someone else (i.e. their parent) to start doing it for them now.

magicbastarder

https://www.boards.ie/discussion/comment/120002871#Comment_120002871

let's run the numbers; let's say the house is worth €600k - nearly double the national average.

by definition, for tax to be paid on that, it can only be one person inheriting it. and also by definition, they have not been living in the house.

they are left the house; the tax payable is €87,450. they are getting a €600k house for that €87.5k; so may need to take out a mortgage for that, a mortgage with a LTV of less than 15%. currently, AIB are offering an LTV variable rate (for loans less than 50% the value of the property) of 2.75%.

a 25 year mortgage on a principal of €87.5k, at 2.75% has a monthly repayment of €403.

https://www.drcalculator.com/mortgage/

as mentioned, by definition, they have not been living in the house; so very likely are paying rent or are a homeowner anyway, and that €400 would constitute a saving, not a cost.

Donald Trump

https://www.boards.ie/discussion/comment/120002969#Comment_120002969

There would also generally be a bit of flexibility in terms of submitting valuations (for Revenue to accept). If the person is indeed going to move into the house to live in it, they will likely be able to get it valued at least a bit under its actual real value. Doing so won't affect them later if they live in it for a few years and then want to sell it at that point for example.

Having it undervalued isn't an advantage though if the person just wants to cash in and sell it. Because they will pay CGT on the gain anyway.

These "hard luck cases" are pushed out as excuses, but genuine ones would be rare. i.e. the downtrodden child with nothing but whose parents had a million quid ancestral house and the child wants to keep it in the family.

OEP

https://www.boards.ie/discussion/comment/120002950#Comment_120002950

I liked your contributions in the other thread. Didn't read one intelligent response to any of them