Duke of Westminster and tax

[Dejavu]

The richest 1000 people in the UK increased their wealth by £92 billion in the last year. That means they are over £1500 better off for every person in the country. Most are tax exiles. The Duke of Westminster just avoided £3.6 billion of inheritance tax He has never done a days work in his life. Meanwhile 1 million brits are regular users of foodbanks. Make the rich pay their tax like the rest of us.

[tim_noone]

Would that be at 20% ?

[dsr]

Do the rest of us pay inheritance tax?

[Damo]

I saw a post similar to this on my social media earlier.
The person who posted it has 4 kids and works about 16 hours per week at my local asda. I'm guessing most of these tax dodgers pay significantly more tax than she does

[IanMcL]

I saw a post similar to this on my social media earlier.
The person who posted it has 4 kids and works about 16 hours per week at my local asda. I'm guessing most of these tax dodgers pay significantly more tax than she does

You describe a working mother.

The Dof W's estate did not pay inheritance tax when, I think it was the grandfather died. Instead, they argued the sum due with the Inland Revenue and by the time negotiations were complete, the agreed sum had been recouped via earnings on the sum they should have paid years before.

There is definitely one rule for the rich and the unexploitable laws for the poor.

Make them pay - they have no right to land bequeathed by William the Conqueror!

[Wile E Coyote]

as long as the thick and sychophantic dross are in the majority, and they plainly are a massive majority, then the poor will suffer.
its why the sun newspaper survives , and its why stories which feature "our boys" with warmongering references are popular.
If you want justice and equality, then the wait will be significant.
Its also why boris Johnson , rugby idiots thrive.

[tim_noone]

I've never had so little ... But never had so much budget and you will prosper to a degree, you can't help being born in to wealth like you can't help being born poor. It is what it is.but greed is another matter.and both rich and poor have this trait.

[Clarets4me]

as long as the thick and sychophantic dross are in the majority, and they plainly are a massive majority, then the poor will suffer.
its why the sun newspaper survives , and its why stories which feature "our boys" with warmongering references are popular.
If you want justice and equality, then the wait will be significant.
Its also why boris Johnson , rugby idiots thrive.

Thanks for that, Jeremy .... how's the allotment ?

[evensteadiereddie]

And that just proves your point, Wile E.

[Darthlaw]

You describe a working mother.

The Dof W's estate did not pay inheritance tax when, I think it was the grandfather died. Instead, they argued the sum due with the Inland Revenue and by the time negotiations were complete, the agreed sum had been recouped via earnings on the sum they should have paid years before.

There is definitely one rule for the rich and the unexploitable laws for the poor.

Make them pay - they have no right to land bequeathed by William the Conqueror!

So you're ****** off that they paid the tax eventually? Right then.

[Woodleyclaret]

The party that makes pensions under £30k tax free will get my vote.I paid into my teacher pension for 30 yrs just to find I loose £250/m in tax.

[Sidney1st]

So neither of the main parties is interested in looking at the tax laws whilst they're in office.....

Somethings will never change.

[dsr]

Thirty years to get a pension close to £30k, and all your contributions paid with full tax relief, and a large dollop of state support for your pension, and based on final salary - and you're still complaining?

[Woodleyclaret]

The current pension situation paid out to teachers who are a vital state asset is a complete scandal.Why should anyone pay tax twice.Once when working once when retired whilst fat cat do nothing politicians are rewarded for abject failure even getting £40k when the loose their seats.

[Lancasterclaret]

Why didn't you take out a private pension to supplement it?

[bedfords]

I assume it's changed but my pension gets taken out at source, before tax.

[Paul Waine]

The current pension situation paid out to teachers who are a vital state asset is a complete scandal.Why should anyone pay tax twice.Once when working once when retired whilst fat cat do nothing politicians are rewarded for abject failure even getting £40k when the loose their seats.

Hi Woodey, but this is the thing, you aren't taxed on your pension contributions - none of us are, unless your earnings are "high." And, you get 25% lump sum tax free.

There is a divide between the public sector where are defined benefit/final salary pensions re guaranteed by the taxpayer - even when the employee's and the employer's contributions fall short of the amount required to cover their pensions - and both the defined benefit and defined contributions in the private sector. If your employer/pension fund can't pay your pension then the fund is taken over by the Pension Protection Fund; there is then a 10% cut in pay out and all higher pensions are capped somewhere around £35,000. If you are defined contribution, it's all down to how much you paid in and how well those investments perform. If they go down, like they did in 2008 you lose out.

[Paul Waine]

The richest 1000 people in the UK increased their wealth by £92 billion in the last year. That means they are over £1500 better off for every person in the country. Most are tax exiles. The Duke of Westminster just avoided £3.6 billion of inheritance tax He has never done a days work in his life. Meanwhile 1 million brits are regular users of foodbanks. Make the rich pay their tax like the rest of us.

Agree with everyone - there should be a lot more clarity about what happens to assets held in trusts and can be passed on from one generation to the next. There shouldn't be a way of escaping inheritance tax (or any tax) that is available to the wealthy if it isn't also available to everyone else - and no need to pay for clever accountants and lawyers.

I heard a radio interview of one of the managers of Grosvenor Estates (that's what Duke of Westminster owns). I didn't catch all of it. The guy seems to say that a lot of tax was paid - more than would have been the case if it paid IHT. Would be great if all these details were available for us all to take a look at and understand.

The previous DoW died suddenly in his 60s. However wealthy or otherwise you are, it doesn't feel right to me that the tax man is waiting for you to die and say "thank you very much."

[dsr]

The current pension situation paid out to teachers who are a vital state asset is a complete scandal.Why should anyone pay tax twice.Once when working once when retired whilst fat cat do nothing politicians are rewarded for abject failure even getting £40k when the loose their seats.

The scandal is in MPs pensions, especially in the particular laws they have enacted to make sure their pensions aren't subject to normal tax like the rest of us. Teachers have better pensions than basically everyone in the country except MPs - that's not a scandal.

[smudge]

Sssquote="Woodleyclaret"]The current pension situation paid out to teachers who are a vital state asset is a complete scandal.Why should anyone pay tax twice.Once when working once when retired whilst fat cat do nothing politicians are rewarded for abject failure even getting £40k when the loose their seats.[/quote]
Don't understand this.
I receive a pension from Royal Mail.I then get a tax code once a year based on total income which includes my retirement pension minus allowances.
I then pay tax like everyone else.
Don't know what your problem is.

[aggi]

The current pension situation paid out to teachers who are a vital state asset is a complete scandal.Why should anyone pay tax twice.Once when working once when retired whilst fat cat do nothing politicians are rewarded for abject failure even getting £40k when the loose their seats.

If you're paying tax twice on your pensions you're doing something wrong. They're taxed when they're paid out but when you pay in you get tax relief.

[Down_Rover]

The previous DoW died suddenly in his 60s. However wealthy or otherwise you are, it doesn't feel right to me that the tax man is waiting for you to die and say "thank you very much."

Could not agree more. To pay income tax ( and VAT) throughout ones life and then to pay IHT seems wrong

[Lancasterclaret]

You need to pay some IHT, but you have to remember that you can mitigate a hell of a lot the amount you pay with careful tax planning.

Which is what everybody who owns anything at all should be doing.

[IanMcL]

So you're ****** off that they paid the tax eventually? Right then.

The rest of us have to pay up right away. The very rich can 'avoid and earn' until it is no longer a burden. The final amount is also much less than the original sum - the 100% of tax that we all pay.

I would refer you to William The C and that 950 years ago, some posh Normandy noble was given large swathes of land for bringing his surfs to fight with William (they probably had no choice). 950 years later, very undeserving and very distant relatives still lay claim to this great wealth. I really don't think that is fair at all.

[aggi]

Agree with everyone - there should be a lot more clarity about what happens to assets held in trusts and can be passed on from one generation to the next. There shouldn't be a way of escaping inheritance tax (or any tax) that is available to the wealthy if it isn't also available to everyone else - and no need to pay for clever accountants and lawyers.

I heard a radio interview of one of the managers of Grosvenor Estates (that's what Duke of Westminster owns). I didn't catch all of it. The guy seems to say that a lot of tax was paid - more than would have been the case if it paid IHT. Would be great if all these details were available for us all to take a look at and understand.

The previous DoW died suddenly in his 60s. However wealthy or otherwise you are, it doesn't feel right to me that the tax man is waiting for you to die and say "thank you very much."

I guess he could be referring to the taxes paid under the 10 year charge on the trusts and on the distribution of spending, etc It probably took a while to reach the £3.5bn or so that would have been due if flat IHT had been paid.

I never had any expectation that a hefty load of IHT would be paid on the DoW's estate, it was always going to largely be held in trust. For all the talk of simplifying the tax system, there are reasons why a lot of these structures exist and it is difficult to filter out what are appropriate and inappropriate uses. At the lower end of the scales you get employees masquerading as companies to avoid income tax, etc and at the higher end of the scale you get complex company structures shifting profits into low tax regimes through the use of management charges, trademark fees and the like.

The more money you have, the more incentive you have to exploit the schemes and the bigger the returns are. The big issue at the moment is that this needs to be tackled on a global basis but we seem to be taking an increasingly isolationist stance which, I believe, will cause the problem to get worse, not better.

[Lancasterclaret]

One of the scenarios about Brexit (yes, I know its going back to this but it is relevent) is that the UK becomes a massive tax haven for the European money.

I'm not sure how that is going to help people who really need it to be perfectly honest, so I'm hoping that TM and her team ditch that one, but I bet they keep it as a threat in the negotiations.

[Paul Waine]

I guess he could be referring to the taxes paid under the 10 year charge on the trusts and on the distribution of spending, etc It probably took a while to reach the £3.5bn or so that would have been due if flat IHT had been paid.

I never had any expectation that a hefty load of IHT would be paid on the DoW's estate, it was always going to largely be held in trust. For all the talk of simplifying the tax system, there are reasons why a lot of these structures exist and it is difficult to filter out what are appropriate and inappropriate uses. At the lower end of the scales you get employees masquerading as companies to avoid income tax, etc and at the higher end of the scale you get complex company structures shifting profits into low tax regimes through the use of management charges, trademark fees and the like.

The more money you have, the more incentive you have to exploit the schemes and the bigger the returns are. The big issue at the moment is that this needs to be tackled on a global basis but we seem to be taking an increasingly isolationist stance which, I believe, will cause the problem to get worse, not better.

Hi aggi, yes, I think you are right, I recall mention of "10 year charge" in the interview.

Also agree, many of the tax issues talked about are international in scope - though most of the media and politicians don't appear to understand this. I feel there is a strong case for dropping corporation tax everywhere and focusing on taxation of the individuals that own the corporations.

[Paul Waine]

One of the scenarios about Brexit (yes, I know its going back to this but it is relevent) is that the UK becomes a massive tax haven for the European money.

I'm not sure how that is going to help people who really need it to be perfectly honest, so I'm hoping that TM and her team ditch that one, but I bet they keep it as a threat in the negotiations.

Hi Lancs, are you thinking of the (in)famous "Belgian dentist" who is rumoured to hide all his money in Swiss bank accounts?

Getting rid of corporation tax would result in more investment and more jobs in the UK. All the USA internet based businesses that are currently based in Dublin (because if their favourable tax CT rates) might move to UK instead. More jobs means more employers' national insurance and more income tax and employees' NIC - some more for the government to spend.

[Lancasterclaret]

Paul, I'm only going off what was mentioned about as "alternatives" after the Brexit vote.

I've no real idea what the Conservative plan is.

[Paul Waine]

The scandal is in MPs pensions, especially in the particular laws they have enacted to make sure their pensions aren't subject to normal tax like the rest of us. Teachers have better pensions than basically everyone in the country except MPs - that's not a scandal.

Hi dsr, I've been making the argument for many years that all MPs and all senior civil servants should receive a defined contribution pension only - with at least 50% paid into NEST. You are right, at present they "hide" their very generous pension benefits - the cost doesn't appear in current year government expenditure, but is passed off to be paid by the younger generations from their taxes in future years. If they had defined contribution pensions it would firstly define the benchmark that all employees in private sector could measure their own pensions against, it would also mean that the MPs etc would be more thoughtful in how their actions impacted on the economy - because their own pensions would be directly better or worse based on their success. This arrangement might have made Gordon Brown pause for thought when he "raided" pensions starting in 1997. The same rules would also have led to George Osborne being more thoughtful with his multiple "grabs" at pensions over his past few budgets.

[Burnley Ace]

I thought their wealth came from a marriage to a farmers daughter who inherited a lot of marsh land outside London, that is now Mayfair?

[dsr]

Hi dsr, I've been making the argument for many years that all MPs and all senior civil servants should receive a defined contribution pension only - with at least 50% paid into NEST. You are right, at present they "hide" their very generous pension benefits - the cost doesn't appear in current year government expenditure, but is passed off to be paid by the younger generations from their taxes in future years.

They don't just hide them, they pass special laws to exempt them. Specifically, everybody who has a pension worth over £1m has to pay a large amount of tax on retirement - except MPs. The law exempts, quite specifically, MPs and the Mayor of London.

(This isn't the only corrupt law they have passed. When an MP loses his seat or retires, he gets paid a year's salary - £74,000. Everyone else in the country who gets a contractual payment over £30k on retirement has to pay tax on it. Not MPs - they have exempted themselves.)

[Paul Waine]

They don't just hide them, they pass special laws to exempt them. Specifically, everybody who has a pension worth over £1m has to pay a large amount of tax on retirement - except MPs. The law exempts, quite specifically, MPs and the Mayor of London.

(This isn't the only corrupt law they have passed. When an MP loses his seat or retires, he gets paid a year's salary - £74,000. Everyone else in the country who gets a contractual payment over £30k on retirement has to pay tax on it. Not MPs - they have exempted themselves.)

And, one of my other reforms would be that the MPs get paid while they are an MP (but are not classed as an employee). They know that it may only be for one parliament. There should be no "leaving bonus" when they are voted out, or chose to retire.

[Acting Claret]

The current pension situation paid out to teachers who are a vital state asset is a complete scandal.Why should anyone pay tax twice.Once when working once when retired whilst fat cat do nothing politicians are rewarded for abject failure even getting £40k when the loose their seats.

I do hope you are not an English teacher..

[Lancasterclaret]

I've got him down as a PE teacher to be honest.

[Imploding Turtle]

I saw a post similar to this on my social media earlier.
The person who posted it has 4 kids and works about 16 hours per week at my local asda. I'm guessing most of these tax dodgers pay significantly more tax than she does

What has this person's number of children got to do with anything? And no, as a proportion of income tax dodgers probably pay far less tax than your friend on social media.

[Imploding Turtle]

The current pension situation paid out to teachers who are a vital state asset is a complete scandal.Why should anyone pay tax twice.Once when working once when retired whilst fat cat do nothing politicians are rewarded for abject failure even getting £40k when the loose their seats.

The double taxation argument is complete nonsense. We all pay tax multiple times. You're income is taxed, then you have to use the untaxed aspect to pay tax on where you live. Then you have to pay tax on powering where you live. Then you have to pay tax on buying the food you eat to stay alive where you live. Then you pay tax on your social life if you want to have a drink with friends. Yet here you are getting all upset on behalf of people who mark down everyone all the way down to food and drinks as business expenditures in order to save money on the tax part of it.

[Burnley Ace]

If my grandad set up a business and did well and he passed it onto my dad, who did well, and he passed it on to me, and I did well, can I pass it on to my son or do I have to give it to the State?

[IanMcL]

If my grandad set up a business and did well and he passed it onto my dad, who did well, and he passed it on to me, and I did well, can I pass it on to my son or do I have to give it to the State?

The difference being, your grandad created the business. he did not just get given land as far as the eye can see, complete with serfs to work it for him.

[tim_noone]

The difference being, your grandad created the business. he did not just get given land as far as the eye can see, complete with serfs to work it for him.

Such is life the haves and the have nots...enjoy the ride.

[mdd2]

The party that makes pensions under £30k tax free will get my vote.I paid into my teacher pension for 30 yrs just to find I loose £250/m in tax.

And why should you not pay tax. All your contributions into your superannuation scheme were tax deductable and in all probability your pension is being subsidised by the tax payer. Incidentally some of your employers payments into your fund were paid out of Council Tax as a lot of Council Tax goes into the Education budget

[Paul Waine]

You need to pay some IHT, but you have to remember that you can mitigate a hell of a lot the amount you pay with careful tax planning.

Which is what everybody who owns anything at all should be doing.

Hi Lancs, suppose you have a heart attack or an accident before you've managed to do the planning? Why should HMRC say "thank you, that's mine?"

I think all taxes should be based on the situation you can be in without the need for any tax planning and with (often expensive) accountancy and legal advice. There should be no taxes that you can avoid if you are "rich enough" to pay for the advice and no taxes that you could have avoided if you'd not died early. (Am I sounding a bit like JC)?

Nothing personal. I believe you've mentioned your wife is an accountant.

[Paul Waine]

The double taxation argument is complete nonsense. We all pay tax multiple times. You're income is taxed, then you have to use the untaxed aspect to pay tax on where you live. Then you have to pay tax on powering where you live. Then you have to pay tax on buying the food you eat to stay alive where you live. Then you pay tax on your social life if you want to have a drink with friends. Yet here you are getting all upset on behalf of people who mark down everyone all the way down to food and drinks as business expenditures in order to save money on the tax part of it.

Hi IT, there is no "double tax" argument between teacher's salary and teacher's pensions (and the same for all other jobs). As many other posters have noted, you only pay tax on your salary after any contributions to your pension scheme have been deducted (and you don't pay tax on the contributions to your pension from your employer). And, you pay tax on the receipt of the pension later, except the 25% lump sum is tax free and tax is charged at your marginal rate when you are retired - which may be lower than your marginal rate when you were working full time.

Yes, having had income tax deducted from our salary/wages we all then pay other taxes when we spend that money.

Small point: there's no tax/vat charged on the food we buy to "eat to stay alive" if we cook it and eat it at home. VAT is charged on some cooked/heated foods and on restaurant meals. Have you noticed the difference in price of coffee between "eat in" or "take away?"

Small point 2: businesses are not allowed to deduct "entertaining expenses" (meals/drinks with customers/suppliers) when they calculate the tax due.

I could ask where was your research, but I won't.

Take care.

[Paul Waine]

The difference being, your grandad created the business. he did not just get given land as far as the eye can see, complete with serfs to work it for him.

I'm kinda "half-and-half" on this one. On one side the Grosvenors could have messed up like most "barons and lords" who were gifted lands for services to the king and so lost it all, on the other the Grosvenors have hung on to their gift and prospered. Actually, thinking about it, whatever they did to get their gifts from the king, it's about time they repaid the gift.

[Archer]

If you're paying tax twice on your pensions you're doing something wrong. They're taxed when they're paid out but when you pay in you get tax relief.

Careful using facts with this guy though, it doesn't help his argument

[Imploding Turtle]

I could ask where was your research, but I won't.

Personal experience.

[If it be your will]

.

[aggi]

Part of the trouble with IHT is it's a sensitive topic. It's hard to suggest to a child that they need to talk to their parent about organising a way to avoid tax on the family home in case they die earlier than they hope. This is particularly an issue in London with many homes now being over the threshold with property prices having increased at a much higher rate than the IHT thresholds.

I was explaining to someone the other day that if their remaining parent died they'd be subject to ~ £200k of tax on the home that they're currently living in. They'd have had no idea that was the case otherwise.

If you own many assets on the other hand, you generally have an accountant and a lawyer who will be advising from an early date to get your estate in order. It is a tax, more than many others, where people are disadvantaged through a lack of awareness and preparedness.

[IanMcL]

Such is life the haves and the have nots...enjoy the ride.

That's the point....sort the haves who are accidental haves.

[Paul Waine]

Remember it's not the dead person suffering this tax on account of them already being dead. In effect (via a reduction in the estate) the person paying the tax is the beneficiary, who has just received a totally unearned windfall. And inheritance tax allowances before paying any tax at all are substantial. If it was up to me I'd scrap inheritance tax but treat all proceeds from inheritance as income and tax it appropriately. We do that with our wages, after all.

Hi iibyw, imagine the situation when one parent dies followed later by the second parent's death - and they have children who are still under 18 years old. Is it right that the tax man says that you have to sell the house that you are living in, because you have received a "totally unearned windfall" and I want my IHT? The children will be grieving the loss of their parents. Should they also lose their home? Thankfully a rare event, but I know that this has happened.

In earlier times the IHT allowance was the equivalent of somewhere over £X millions in today's money. It is shameful that the allowance hasn't been increased at the same rate as house prices in the more expensive regions of the country. Family homes (3/4 bedrooms) cost more than £1 million in many "ordinary" parts of London.