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Rodney Collins
United Kingdom
424 Posts |
 Posted - 19/01/2008 : 09:57:01
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I wonder how meny of you have ever given a thought to the IHT ( inheritance tax)liablity that your little treasure or treasures represents? IHT is the bain of all of our lives, its the only voluntary tax and most people volunteer to pay it! Mr Darling made his infamious statement in his speech last year that he was increasing the nil rate band to £600,000 --------------long pause and then added PER COUPLE! Well if you did not already know it was already £600,000 per couple, all you needed was a good will and you made use of both nil rate bands. The new rules will benefit widows and widowers who lost their partners years ago and left all of their estate to the survivor, however this is not as strightforward as it seems because you have to have records going back 7 years before he or she died or be able to prove no gifts was made 7 years prior to death, and no legacy was left to anyone at the time of death.
SO MY POINT IHT on old cars. weather you own a P type worth £20,000 a K3 worth £300,000 or a Bugatti type 35 worth a million, they will all go into the pot on death (second death) and 40p in the pound will be charged providing your joint estate is over £600,000.This means that you son or daughter has to buy the car back form the revenue at the rate of 40% of it's value! Now their are lots of ways to legaly remove capital from an estate and also property,i do it every day for a living, but what can you do with an old car worth a lot of money? Well why not register the car in your beneficires name let him or her insure the car with you as a named driver.Keep it in your garage and charge your beneficery £15 per month rent keep a record of the rent and declare it on you tax return (if you do one). You can use the car and to be honest who will ever know how much you use it! You will get away with it. You will buy receiving rent for the garage space avoid the gift with resevation rule. I put this to one of the countries leading baristers who works soley in this field, he said anyone with a valuable car would be daft not to do it. The odd one may be caught out but 99.9% would get away with it.Of course you could sell it to your son or daughter as we are lucky that it will not suffer capital gains tax! Well not yet anyway!! Rodney |
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sam christie
United Kingdom
3056 Posts |
Posted - 19/01/2008 : 12:20:13
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Rodney,you have pointed out something that the press missed in any news coverage I saw, but my wife pointed it out at once. The chancellor only 'gave' what had already been available to any couple who knew enough to make a tax efficient will.
Not only did the press 'sleep in' but the opposition choose to argue about when the decision had been made rather than the fact it was old news.
It really is a sad thought that 40% of your blood sweat and tears (as well as 17.5% tax on the costly components paid for from your already heavily taxed earnings) will go to the chancellor.
Still its comforting to know that the chancellor is far more competent to handle your money than you are. He is.... isn't he ??
Sam |
Edited by - sam christie on 19/01/2008 16:51:45 |
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