Media Article: Cash sweeteners to get elderly couples to sell family homes

Parky2

The_Conductor wrote: »

Quit sniping at one another. If you can't remain civil towards other posters- please don't post.

Who is being uncivil?

The_Conductor

Parky2 wrote: »

Who is being uncivil?

Both yourself and Rainyday.
Whether or not you qualified for mortgage relief- or used any services provided by the State- is not relevant to the topic under discussion- however, goading Rainyday- isn't appropriate behaviour either. Had you reported their posts instead of sniping back at him/her- they'd have earned a warning for their stunt.

RainyDay

The_Conductor wrote: »

Both yourself and Rainyday.
Whether or not you qualified for mortgage relief- or used any services provided by the State- is not relevant to the topic under discussion- however, goading Rainyday- isn't appropriate behaviour either. Had you reported their posts instead of sniping back at him/her- they'd have earned a warning for their stunt.

Fair enough. I'll stick with the general point, rather than the personal one. The State has subsidised private housing significantly. I heard one housing economist use a figure of 2-4 billion a year to describe the period before mortgage interest relief was pulled back.

Many of those who claim to have 'never got a hand out' or 'never got anything back for all my taxes' benefited significantly from these subsidies.

Parky2

The_Conductor wrote: »

Both yourself and Rainyday.
Whether or not you qualified for mortgage relief- or used any services provided by the State- is not relevant to the topic under discussion- however, goading Rainyday- isn't appropriate behaviour either. Had you reported their posts instead of sniping back at him/her- they'd have earned a warning for their stunt.

Whe report their posts? I assume that they are adults and are capable of answering a simple question to back up their claim.

However...

RainyDay

Parky2 wrote: »

I assume that they are adults and are capable of answering a simple question to back up their claim.

However...

The answer is in the article "Mortgages taken out after December 31st, 2012 do not qualify for mortgage interest relief."

So if you took out a mortgage before that date, you benefited from mortgage interest relief. But if you are still unclear, feel free to post the dates at which you did have a mortgage, and I or others will be glad to help.

Over to you now (in my most civil voice)...

The_Conductor

Move on.
This thread is not about MIR.
If you want to start a thread about MIR- open one- but do not derail this one.

Arbiter of Good Taste

Living Off The Splash wrote: »

So the elderly person sells their home. (What is elderly?). They realise €1m. They downsize to a €500k home. They now have €500k in the bank. Maybe earning .75% interest? Not keeping pace with inflation. But their house that they just sold is increasing in value by %.

Does this €500k move them in to a new tax bracket. Will their state pension, medical card be affected? They want to give generously to their children from this €500k. They are allowed to receive €3k tax free per annum.

Also worries about the future cost of nursing homes. Maybe keep the bigger house and get a home help to live in house?

Ireland doesn't tax wealth, only income or gains or transactions

Contributory pension should not be affected

Medical card? Don't know

Can gift €280k tax free to each child over their lifetime

Why would they worry about nursing home costs with €500k in the bank - or are you suggesting their children are given €280k each tax free and the taxpayer pick up the slack?

Who is going to pay for the home help if the person has a big house but is cash poor? The Taxpayer?

4ensic15

Arbiter of Good Taste wrote: »

Ireland doesn't tax wealth, only income or gains or transactions

Contributory pension should not be affected

Medical card? Don't know

Can gift €280k tax free to each child over their lifetime

Why would they worry about nursing home costs with €500k in the bank - or are you suggesting their children are given €280k each tax free and the taxpayer pick up the slack?

Who is going to pay for the home help if the person has a big house but is cash poor? The Taxpayer?

The problem is not with people who can't live independently. They will be forced to move or sell by circumstances anyway.
A relation of mine by marriage lives near UCD. When they moved there, the house was between 2 houses with a woman living alone in each house. the houses had gardens which they did not have the ability of interest to manage. They moved to another road and were again between two houses with a woman living alone in each. Opposite were a brother and sister in a valuable house living on means tested social welfare pensions. Meantime the local school had vacancies are there were too few children in the area. At the same time schools were bursting in newer suburbs. It is madness. the countryside is being torn up for new building and yet with some creativity much better use could be made of the housing stock.

on_my_oe

We are 25 years off retiring but we are already taking up more space than we need - we have a three bed room apartment with a private garden but are childless. The upside is, the cats have south and north facing sun spots in three different bedrooms to chose from. Most likely when our parents are too old to visit us, we'll buy a two bedroom and turn the second room into an office/man cave, and retain the apartment as a rental until we retire and cash up.

Here's what will discourage us from moving

a) stamp duty - being penalised for buying a home is ridiculous
b) our mortgage - amortalisation feels like we are paying rent for the first five years of our mortgage, so downsizing right now would be throwing money away, especially as we upgraded the fixtures and fittings when we moved in
c) existing property prices - if we moved, we'd go for a two bedroom semi, but at the price we would sell our apartment for, we would need to increase our mortgage.
d) our neighbours - we like most of them

We don't have a tracker and we don't have an interest rebate as we only brought 18 months ago.

hytrogen

The_Conductor wrote: »

What we have here- is a classical argument of whether we should be looking at the rights of society in general- or the rights of the individual.

Parky2 - you bought your house with your own money and are free to do with it as you please. The scheme being proposed- is a bribery system to try and often cash and/or favourable tax treatments to those with family homes- to vacate those homes. Whether they subsequently buy an apartment in Blackrock- or a nice cottage in the North of Spain- is not under the remit of the proposed scheme. Also- you don't pay CGT on your PPR already- so thats not a concern.

If you own a residential property valued at 1 million- it is most probably falling in value- no matter how you look at it- one of the other posters on this thread was making the argument that it had to be rising in value more than the interest rate they'd get on cash in the bank- well, no, it doesn't.........

It seems we have an entrenched 'castle' attitude here- and from the few comments here (and discussing it elsewhere)- I can't see the scheme working at all- regardless of how many incentives or inducements they offer to people to vacate family homes.........

Completely agree with this point and there in lies the fundamental problem of this paradox; valuations. It's completely opinion based on what estate agents think they can flog a property for based on what commission they can wrangle.
Currently the tide is turning bringing with it the rise of the Celtic Phoenix and yet again hyper-inflation mostly because those who didn't cash in in the last boom times want out now for the same prices they were quoted. Those said owners are a decade older, non the wiser & salivating at the lips for some hard cash. It's these who this scheme will seem the most appetising and let the new breed of vultures hover a fresh killing..

hytrogen

quadrifoglio verde wrote: »

Personally they should focus on utilising council housing stock so that the Granny living in a 3 bed council house by herself is moved into a one bed and the young mother living in a hotel is moved into the 3 bed

A purpose build sheltered accommodation estate would suffice better than using what is more needed by homeless families because the state, as we see daily, has proved it cannot support elderly or people in general effectively outside of institutions. (For another thread, the state desperately needs to invest into community care programs to get the non-critical patients home quicker.) This investment must include suitable elderly accommodation within the community and not nursing home institutions to which we are all too well familiar.

Arbiter of Good Taste

Arbiter of Good Taste wrote: »

Why would they worry about nursing home costs with €500k in the bank - or are you suggesting their children are given €280k each tax free and the taxpayer pick up the slack?

Who is going to pay for the home help if the person has a big house but is cash poor? The Taxpayer?

I would certainty think anyone with big cash reserves should be "moving it around" to avoid heaps of it being taken for medical bills etc.

4ensic15 wrote: »

The problem is not with people who can't live independently. They will be forced to move or sell by circumstances anyway.
A relation of mine by marriage lives near UCD. When they moved there, the house was between 2 houses with a woman living alone in each house. the houses had gardens which they did not have the ability of interest to manage. They moved to another road and were again between two houses with a woman living alone in each. Opposite were a brother and sister in a valuable house living on means tested social welfare pensions. Meantime the local school had vacancies are there were too few children in the area. At the same time schools were bursting in newer suburbs. It is madness. the countryside is being torn up for new building and yet with some creativity much better use could be made of the housing stock.

So what, its their home and that's where they want to live tough luck really is my answer. As I said before a home is more than just a building and people don't want to leave their homes. Also the cases being highlighted here would be the exceptions imo. Most homes will either be using the rooms with family, grandkids etc visiting or the homes will be passed into son/daughter who will live there with their family. There are also plenty of people well able to maintain and afford to look after their homes well into their late years. My grandfather was running a farm into his 80's never mind looking after a house.

Also just because you have no kids doesn't mean you dont need a 3 or 4 bedroomed house. What if you have lots of stuff, you want a dedicated room for a snooker table, you regularly have visitors etc etc etc

I think its insanity that its being suggested people move out of their home to accommodate others.

4ensic15

Nicholas Round Sailing wrote: »

I would certainty think anyone with big cash reserves should be "moving it around" to avoid heaps of it being taken for medical bills etc.



So what, its their home and that's where they want to live tough luck really is my answer. As I said before a home is more than just a building and people don't want to leave their homes. Also the cases being highlighted here would be the exceptions imo. Most homes will either be using the rooms with family, grandkids etc visiting or the homes will be passed into son/daughter who will live there with their family. There are also plenty of people well able to maintain and afford to look after their homes well into their late years. My grandfather was running a farm into his 80's never mind looking after a house.

Also just because you have no kids doesn't mean you dont need a 3 or 4 bedroomed house. What if you have lots of stuff, you want a dedicated room for a snooker table, you regularly have visitors etc etc etc

I think its insanity that its being suggested people move out of their home to accommodate others.

In none of the cases I have referred to were they accommodating relatives or enjoying the garden. They might have moved within the area if it was feasible to do so.

4ensic15

4ensic15 wrote: »

In none of the cases I have referred to were they accommodating relatives or enjoying the garden. They might have moved within the area if it was feasible to do so.

But they most likely didn't want to leave their home regardless of how many incentives they were offered.

Arbiter of Good Taste

Nicholas Round Sailing wrote: »

I would certainty think anyone with big cash reserves should be "moving it around" to avoid heaps of it being taken for medical bills etc.



So what, its their home and that's where they want to live tough luck really is my answer. As I said before a home is more than just a building and people don't want to leave their homes. Also the cases being highlighted here would be the exceptions imo. Most homes will either be using the rooms with family, grandkids etc visiting or the homes will be passed into son/daughter who will live there with their family. There are also plenty of people well able to maintain and afford to look after their homes well into their late years. My grandfather was running a farm into his 80's never mind looking after a house.

Also just because you have no kids doesn't mean you dont need a 3 or 4 bedroomed house. What if you have lots of stuff, you want a dedicated room for a snooker table, you regularly have visitors etc etc etc

I think its insanity that its being suggested people move out of their home to accommodate others.

You realise nobody is being forced to move anywhere. It's just a suggestion that sweeteners be provided which people can choose to accept or reject if they so wish.

Saying that, the taxpayer should not be expected to bear the burden of the costs of tending to the relatively wealthy - where that care is required - so that the next generation can enjoy a cushy inheritance.

Graces7

Clarissa Teeny Sinkhole wrote: »

But they most likely didn't want to leave their home regardless of how many incentives they were offered.

Thanks for this Clarissa Teeny Sinkhole; this has been in my mind since this thread started. A home and a neighbourhood is far more than a house. You cannot cajole or persuade an old person to leave their home as some here think they should. That home will hold so much that is meaningful for them. It comes into my mind the arguments re euthanasia in Holland where some old ones thought it was their duty to agree to die as they might be too much trouble. Sorry if that sounds too extreme but it just came to me .Freedom of choice and attachment to a home they have lived in many years. Maybe younger folk here do not see a house in that way? So many here do. Thinking of some of my old neighbours here. Uprooting would in many ways kill them. .

Graces7

Arbiter of Good Taste wrote: »

You realise nobody is being forced to move anywhere. It's just a suggestion that sweeteners be provided which people can choose to accept or reject if they so wish.

Saying that, the taxpayer should not be expected to bear the burden of the costs of tending to the relatively wealthy - where that care is required - so that the next generation can enjoy a cushy inheritance.

Yes I agree Arbiter but some of the posts here carry a rather more, shall we say insistent message. Just some ....

on_my_oe

Arbiter of Good Taste wrote: »

You realise nobody is being forced to move anywhere. It's just a suggestion that sweeteners be provided which people can choose to accept or reject if they so wish.

Saying that, the taxpayer should not be expected to bear the burden of the costs of tending to the relatively wealthy - where that care is required - so that the next generation can enjoy a cushy inheritance.

I partially agree with this. However why should those who have worked hard and accumulated assets be subject to paying for their care and those who have achieved less in life (or not worked at all), receive free care?

keane2097

on_my_oe wrote: »

I partially agree with this. However why should those who have worked hard and accumulated assets be subject to paying for their care and those who have achieved less in life (or not worked at all), receive free care?

Why ever tax the wealthy more for anything in that case?

on_my_oe

keane2097 wrote: »

Why ever tax the wealthy more for anything in that case?

I actually believe there should be a flat rate, and that death duties and capital gains are a punishment for achieving something in life. Why would anyone work hard in life, buy their own home etc, to be told at retirement age "Move, you're hogging family homes" or "Sell up, you need to (co-)pay for your care - old Joe who sat in the pub on the dole for the last 40 years though gets free care".

on_my_oe

on_my_oe wrote: »

I partially agree with this. However why should those who have worked hard and accumulated assets be subject to paying for their care and those who have achieved less in life (or not worked at all), receive free care?

+100 on this.

keane2097 wrote: »

Why ever tax the wealthy more for anything in that case?

The wealthy are extremely over taxed you are right on that one. Work hard, earn more and see most of it disappear in tax its sickening to the core to see how little you get into your hand with a pay rise due to the crazy tax rate along with USC, PRSI etc etc. Then you have 33% tax on inheritance and an absolutely insane Dirt of 41% on interest. I'd advise anyone to make plans for their money so it cant be taken again when they get old be it thorough inheritance/gift taxes or being taken for health care.

If anything because they have paid more tax they should be first in line for state help as they have paid for it in their taxes.

Eugene Norman

Nicholas Round Sailing wrote: »

But they most likely didn't want to leave their home regardless of how many incentives they were offered.

Nobody is forcing anybody to leave anywhere.

Eugene Norman

Nicholas Round Sailing wrote: »

+100 on this.



The wealthy are extremely over taxed you are right on that one. Work hard, earn more and see most of it disappear in tax its sickening to the core to see how little you get into your hand with a pay rise due to the crazy tax rate along with USC, PRSI etc etc. Then you have 33% tax on inheritance and an absolutely insane Dirt of 41% on interest. I'd advise anyone to make plans for their money so it cant be taken again when they get old be it thorough inheritance/gift taxes or being taken for health care.

If anything because they have paid more tax they should be first in line for state help as they have paid for it in their taxes.

Who works hard for inheritance? Or gifts?

Obviously labour is taxed ridiculously in this country but that's because we don't tax wealth enough.

Eugene Norman

Eugene Norman wrote: »

Who works hard for inheritance? Or gifts?

Obviously labour is taxed ridiculously in this country but that's because we don't tax wealth enough.

The people who earned the money should be able to give it to who they want without crazy amounts of it being diverted to the government. If I was leaving/gifting someone money and they had to pay 33% tax on it I would see that as me paying 33% of my money to revenue on money that I had already possibly paid over 50% tax on.

Inheritance tax should be totally abolished imo it's an abomination.

Eugene Norman

Nicholas Round Sailing wrote: »

The people who earned the money should be able to give it to who they want without crazy amounts of it being diverted to the government. If I was leaving/gifting someone money and they had to pay 33% tax on it I would see that as me paying 33% of my money to revenue on money that I had already possibly paid over 50% tax on.

It's not a tax on the giver. It's a tax on the recipient. That's who pays.

Inheritance tax should be totally abolished imo it's an abomination.

Inheritance tax should be massively increased to reduce tax on productive people. And to create something like a meritocracy.

keane2097

Inheritance is tax that limits people profiting from the hard work of their ancestors, ensuring that those of their peers who work harder than them aren't totally ****ed over by the fact that the lazy guy next door has parents who are rich.

It's probably the most foolishly lampooned and poorly understood tax there is.

Parky2

Eugene Norman wrote: »

What? The rich, he greedy and the banksters are opposed to inheritance tax.

What planet do you live on?

Earth, and you?

I wrote:

Only the greedy, the banksters and the politicians are happy with this disgusting taxation!

Which suggest that they are certainly not opposed to these taxes.

keane2097

Parky2 wrote: »

Earth, and you?

I wrote:



Which suggest that they are certainly not opposed to these taxes.

Are you saying you think wealthy banksters, politicians and assorted greedy people are in favour of inheritance tax?

kazamo

keane2097 wrote: »

Inheritance is tax that limits people profiting from the hard work of their ancestors, ensuring that those of their peers who work harder than them aren't totally ****ed over by the fact that the lazy guy next door has parents who are rich.

It's probably the most foolishly lampooned and poorly understood tax there is.

If that is the case why do we have agricultural relief and business relief as a way of substantially limiting this tax liability for certain wealthy people. If we introduce a rule to disadvantage the lazy, then it should apply to all.

I have no issue with inheritance tax in principle, just that the penal rates kick in quicker here than elsewhere.

In Ireland, son\daughter inherits, 500k
Threshold 280k, balance at 33% giving tax liability of 72,600.

In Germany, son\daughter inherits 500k.
Threshold 400k, 100k at 11% giving tax liability of 11,000

http://www.expatica.com/de/finance/Inheritance-tax-in-Germany_108115.html

Maybe its just my cynical attitude in thinking we have high inheritance taxes to offset the sizable assets that avail of the various reliefs or even avoid inheritance tax by purchasing assets in the children's name to start with.

Parky2

keane2097 wrote: »

Are you saying you think wealthy banksters, politicians and assorted greedy people are in favour of inheritance tax?

Drop the tomfoolery, you are not getting anywhere!