Inherited house

Lumen

Lumen wrote: »

I'd imagine the sense of entitlement is similar. Rich people aren't known for enjoying paying taxes.

I would prefer to live in a society where people get reasonably equal opportunities in life, or at least where those natural advantages are evened out a bit. I know absolute equality is impossible and probably undesirable, but wheelbarrows of inherited cash sits just on the wrong side of the line for me.

I'd prefer if the gov, revenue and society etc kept their paws off others peoples money, Capital acquisitions tax (which covers gifts and inheritances) is to me the equivalent of breaking into someones house and robbing them.

Money a family has should be theirs to use as they please, pass around among the family without anyone even knowing never mind tax being due, be used to give themselves every advantage over others to succeed etc.

Its play ground level stuff really. "I cant have it so he shouldn't either"...

beauf

Lumen wrote: »

...but wheelbarrows of inherited cash sits just on the wrong side of the line for me.

Its seems those wheelbarrows are integral to the social and economic fabric, but only if you live on a farm. If you happen to have a multi generation home in a city, your a freeloader. It should be sold off to provide some commodity for some foreign fund at minimal rates of tax.

Of course its wheelbarrows of cash if you are selling, if you are buying, then its simply the (inflated) market rate in a desirable city.

Marcusm

Lorelai Quick Drum wrote: »

I'd prefer if the gov, revenue and society etc kept their paws off others peoples money, Capital acquisitions tax (which covers gifts and inheritances) is to me the equivalent of breaking into someones house and robbing them.

Money a family has should be theirs to use as they please, pass around among the family without anyone even knowing never mind tax being due, be used to give themselves every advantage over others to succeed etc.

Its play ground level stuff really. "I cant have it so he shouldn't either"...

Unless your family property was in your hands pre 1870s you can guarantee that your family acquired it via a socialised resdistribution of wealth!

Water John

A business property, shop, garage farm are treated as a property asset and taxed accordingly. A domestic house urban or rural house is different and taxed accordingly.

As another poster pointed out already, the simple mechanism for transferring the main residence is, to do it while parents are young and healthy, whilst they retain a life interest to live there. House has little market value. After 5 years no comeback on it for nursing home care etc.

Lumen

Lorelai Quick Drum wrote: »

I'd prefer if the gov, revenue and society etc kept their paws off others peoples money, Capital acquisitions tax (which covers gifts and inheritances) is to me the equivalent of breaking into someones house and robbing them.

Money a family has should be theirs to use as they please, pass around among the family without anyone even knowing never mind tax being due, be used to give themselves every advantage over others to succeed etc.

Its play ground level stuff really. "I cant have it so he shouldn't either"...

That's how tax works. Get over it!

rsynnott

conorhal wrote: »

inheritance is rapidly becoming the ONLY way that many will ever get their foot on the property ladder, so people get resentful even that avenue can close off if they can't afford to inherit without selling.

If that's true, which I have my doubts about, then that's actually more of an argument for reducing the size of the tax free allowance, to lessen the distortion of the market by inheritance.

And again, if you're getting a windfall of 300k tax free (plus possibly more on top taxed at 33%) you can afford to buy a house. These are the only people to whom inheritance tax applies.

Ush1

Any time there is a transfer of wealth, the government has to get its slice.

Blut2

Lorelai Quick Drum wrote: »

I'd prefer if the gov, revenue and society etc kept their paws off others peoples money, Capital acquisitions tax (which covers gifts and inheritances) is to me the equivalent of breaking into someones house and robbing them.

Money a family has should be theirs to use as they please, pass around among the family without anyone even knowing never mind tax being due, be used to give themselves every advantage over others to succeed etc.

Its play ground level stuff really. "I cant have it so he shouldn't either"...

So would you rather more income tax on workers then? Because the real world options here aren't "inheritance tax or no tax", its "inheritance tax or income tax".

Re: Paris Hilton regardless of how much work shes doing now, or how much the family is giving to charity shes still a poster child for inheriting far too much money to begin with.

Mr. Incognito

I'd prefer if the gov, revenue and society etc kept their paws off others peoples money, Capital acquisitions tax (which covers gifts and inheritances) is to me the equivalent of breaking into someones house and robbing them.

Money a family has should be theirs to use as they please, pass around among the family without anyone even knowing never mind tax being due, be used to give themselves every advantage over others to succeed etc.

Its play ground level stuff really. "I cant have it so he shouldn't either"...

This was tried.

It was called the Feudal system.

The nobility kept all the wealth, didn't pay any taxes and the poor didn't own any property but rather rented it for a portion of their crops or their allegance any time the nobles decided to play war in their bespoke armour where if they were captured by their cousins they were feasted until the ransoms were paid.

This lead to the rise of socialism and violent revolts and wars.

Taxation is a system of distributing wealth. A company has to pay salaries, that is wealth distribution. The largest expense of any company is wages. These are then dispersed into the economy.

Similarly if you die, your home is gifted to your children and you have thresholds for this which are generous and more than the value of most famuily homes.

After this- you pay tax. And you know what that is called? Socialism. The redistribution of wealth from the bourgeoisie to the State.

This pays for;

Hospitals,
Roads
Schools
Capital Infrastructure
Electricity
Police Forces

etc.

And that's democracy.

People want all these services without paying for anything. Most of the people who were out marching on a Tuesday and Wednesday for the water charges are on the dole and dont contribute to society and are used to having things handed to them.

Shure it comes outta da sky Joe!! Ironically they call themselves socialists. They are not socialists. They are parasites. But that's society. We will always have the begrudgers and the lazy. At least in this society they have some sort of minimum state allowance.
If you dont like it, get a job like everyone else.

beauf

Blut2 wrote: »

...Re: Paris Hilton regardless of how much work shes doing now, or how much the family is giving to charity shes still a poster child for inheriting far too much money to begin with.

From the wiki it seems she hasn't inherited anything yet. Shes actually created most of her own personal wealth herself. She stands inherit about 30~40% her personal annual income. She was pretty much set up once she was became a successful model with top designer brands. As most models are.

So as an example you picked a bad one.

beauf

Mr. Incognito wrote: »

T...People want all these services without paying for anything. ....

I like the way if any objects to any sort of tax, they magically become someone who wants services for nothing, and doesn't pay tax.

Its like the idea that cyclists don't pay tax and are some sort of freeloaders.

Blut2

beauf wrote: »

From the wiki it seems she hasn't inherited anything yet. Shes actually created most of her own personal wealth herself. She stands inherit about 30~40% her personal annual income. She was pretty much set up once she was became a successful model with top designer brands. As most models are.

So as an example you picked a bad one.

This is an odd derail, but where exactly do you think she got the money to be a jetsetting socialite from the ages of 17-22, before she got her big media break? Do you think she was flying to Monaco, on a private jet, from doing a paperround? Low level 'modelling' that she started at 19 certainly wasn't paying for her living in the Waldorf Astoria at age 17 partying her ass off.

She has since parlayed her fame into a successful income stream, but she was the very definition of a international socialite who was a wasteful beneficiary of family wealth for over half a decade. Shes a perfect example of someone who's inheritance should have been taxed more: instead of 5* hotels and shopping sprees for a teenager, public services could actually have been improved for the poorer in society with that money. Or income taxes reduced for the middle class. Or pretty much anything you can think of.

rsynnott

rsynnott wrote: »

If that's true, which I have my doubts about, then that's actually more of an argument for reducing the size of the tax free allowance, to lessen the distortion of the market by inheritance.

What utter nonsense, people should damn well be entitled to get a head start from the money their family owns, why should they be expected to fork out a single cent to support other people.

Ush1 wrote: »

Any time there is a transfer of wealth, the government has to get its slice.

Except in all the countries that it doesn't.

Inheritance tax is a totally unfair and unjust tax and many contries have none or far lower than here.

Money or assets in a family should be considered belonging to that family simple as that. That money was earned and taxed (or assets bought from taxed money) and it should be then free to share without any tax.

Its a simple fact that those who think inheritance tax is fair as simply begrudging those who get help in the form of gifts and/or inheritances from family.

And no I don't propose an increase in income taxes, these are also far too high in this country also for those on even modest incomes. In this country you are punished for being successful be that in the form of income taxes or when you attempt to help out your family in the form of gift and inheritance taxes. At least those who understand the system can work on tax planning and minimise the tax they pay but it simply should not be required.

Mr. Incognito wrote: »

People want all these services without paying for anything. Most of the people who were out marching on a Tuesday and Wednesday for the water charges are on the dole and dont contribute to society and are used to having things handed to them.

Shure it comes outta da sky Joe!! Ironically they call themselves socialists. They are not socialists. They are parasites. But that's society. We will always have the begrudgers and the lazy. At least in this society they have some sort of minimum state allowance.
If you dont like it, get a job like everyone else.

I'd be pulling the dole from anyone unwilling to work far far sooner than increasing income tax or robbing people with inheritance tax. Out on the street with them if they won't work.

beauf

I think you missed the bit about family wealth going to charity.

Unless someone was raised by wolves they aren't going to meet the criteria of financial independence required for this thread. I'm not sure we go from inheritance tax in Ireland to Paris Hilton flying wheelbarrows of money to Monaco. Which wouldn't come under inheritance tax either BTW.

We are either a free loader paying no tax living off the state or born with a silver spoon. Can't win I guess.

Blut2

beauf wrote: »

I think you missed the bit about family wealth going to charity.

Unless someone was raised by wolves they aren't going to meet the criteria of financial independence required for this thread. I'm not sure we go from inheritance tax in Ireland to Paris Hilton flying wheelbarrows of money to Monaco. Which wouldn't come under inheritance tax either BTW.

We are either a free loader paying no tax living off the state or born with a silver spoon. Can't win I guess.

Someone being given a gift of, say, €50,000 from their parents to pay for a private jet ride (or any other more worthy cause) would absolutely fall under tax law in Ireland. CAT is charged on both gifts and inheritances from parents, for much the same reasoning.

Nobody is claiming someone "has to be a free loader or born with a silver spoon" - thats a strawman of your own construction. What myself and other posters in the thread are pointing out is that a lot of people inheriting €320k+ from their parents would perhaps be less deserving of a tax break on that gift than someone whos paying 50% odd of income tax on every cent they earn over €34k, for breaking their balls 40 hours a week in a job, would be deserving of an income tax break.

beauf

I said inheritance tax not tax law. They probably had their own plane considering they are billionaires.

I don't see why someone can't be both hard working and get a inheritance, or indeed be hard working and left an inheritance to a child. When did it become immoral? To have earned wealth or to accept a gift.

This is all beside the point. I just think inheritance is wrong at the level its at.

The_Conductor

Guys- I can see how this thread has evolved- however, we're straying so far away from the whole premise of Property- and how its taxed- that this really is no longer an appropriate venue for this discussion.

Can we move back to property- and how its taxed in an Irish context- please- or else, with regret, I'm going to have to close the thread.

beauf

Pero_Bueno wrote: »

So we live abroad, and have our own places, so basically we will be slapped with a huge bill when we get this house ?

This is nuts, we cant afford it and dont want to sell the house.

You might be under the limit. You might also consider that you might be able to sell it, and buy something that's more suitable (affordable), either as an investment, or a holiday home etc. If the reason was sentimental, then that's a different issue. Selling it might prevent issues with a sibling. Which can develop unexpectedly where previously there were none.

4ensic15

Marcusm wrote: »

Unless your family property was in your hands pre 1870s you can guarantee that your family acquired it via a socialised resdistribution of wealth!

There was no re-distribution of wealth. The landlords of the turn of the 20th Century were very well paid for their land. The tenants had to take on 70 year mortgages to pay off the money given to the landlords who were already at the end of the cycle with land ownership on a large scale.

Blut2

beauf wrote: »

I said inheritance tax not tax law. They probably had their own plane considering they are billionaires.

I don't see why someone can't be both hard working and get a inheritance, or indeed be hard working and left an inheritance to a child. When did it become immoral? To have earned wealth or to accept a gift.

This is all beside the point. I just think inheritance is wrong at the level its at.

Its nothing to do with judgemental morality, though. Its the fact that revenue generation for the state is a zero-sum game. If inheritance tax is reduced, then income tax will go up to compensate.

So the question becomes - which is a fairer way for the state to raise revenue? Via income tax on earnings, or inheritance tax? If you think inheritance tax is wrong at the level its currently at, would you support an increase in income tax rates instead to compensate for its reduction?

Generally speaking, taxing inheritance is viewed as good for society because it a) does not discourage work, the way income tax can and b) at present levels it targets only those receiving the equivalent of almost 11 years of median income. ie those highly likely to be financially comfortable after receiving the inheritance.

rsynnott

4ensic15 wrote: »

There was no re-distribution of wealth. The landlords of the turn of the 20th Century were very well paid for their land. The tenants had to take on 70 year mortgages to pay off the money given to the landlords who were already at the end of the cycle with land ownership on a large scale.

Er, there was considerable state funding; while landlords were in many cases well-paid (certainly some of them would argue they weren't; they were quite unhappy about some of the compulsory purchases), it was often state-subsidised. State subsidy of tenants buying their land is a form of redistribution of wealth. In other cases artificially cheap loans were made available; again, this is subsidy. See https://en.wikipedia.org/wiki/Irish_Land_Acts

4ensic15

rsynnott wrote: »

Er, there was considerable state funding; while landlords were in many cases well-paid (certainly some of them would argue they weren't; they were quite unhappy about some of the compulsory purchases), it was often state-subsidised. State subsidy of tenants buying their land is a form of redistribution of wealth. See https://en.wikipedia.org/wiki/Irish_Land_Acts

The state gave mortgages.

LirW

One poster brought up a good point: the increasing number of only-children inheriting property that was bought decades ago and is now considered to be in an upper market area.

The reason why this is a subject of matter to me is that my partner is in exactly this scenario. Both parents retired, they never worked in fancy jobs but bought a 3bed semi in an area that averages over 600k at the moment - 30 years ago. They wouldn't want him to sell the house but since he moved out and has his own small home he would be left with no choice but selling up. I understand that he still would get out with a cash sum a lot of people would chop their arm off but in the end this money will go back into the market. He couldn't afford to pay off a loan to keep the house and this is hard to think about really, especially because the family is very close.
I know it's often portrayed as "the people who won't inherit at all" and the very wealthy ones that can afford to park money in charities, but like everything in life this isn't black and white and can f some people over that build something for their children.

Anyway the OP needs to keep a close look at the thresholds because they change a lot.

rsynnott

4ensic15 wrote: »

The state gave mortgages.

Depends which land act you're talking about; there were about five of them. Some involved mortgages (generally at interest rates much lower than commercially available), some involved outright subsidy of the purchase, some involved compulsory purchase.

rsynnott

LirW wrote: »

The reason why this is a subject of matter to me is that my partner is in exactly this scenario. Both parents retired, they never worked in fancy jobs but bought a 3bed semi in an area that averages over 600k at the moment - 30 years ago. They wouldn't want him to sell the house but since he moved out and has his own small home he would be left with no choice but selling up.

So, if he inherited today, he's be liable to pay tax on 290k, at a rate of 33%. That's 95k. So, sell existing house, get a small mortgage. Seems totally doable (unless in major negative equity, I suppose)? He'd presumably be selling his existing house anyway if he wanted to live in the family one.

rsynnott

rsynnott wrote: »

So, if he inherited today, he's be liable to pay tax on 290k, at a rate of 33%. That's 95k. So, sell existing house, get a small mortgage. Seems totally doable (unless in major negative equity, I suppose)? He'd presumably be selling his existing house anyway if he wanted to live in the family one.

95k in tax to keep your family home. It's absolutely disgusting, no better than someone who robs a bank.

rsynnott

Lorelai Quick Drum wrote: »

95k in tax to keep your family home. It's absolutely disgusting, no better than someone who robs a bank.

"Buying" a house worth 600k for 95k? I'd be pretty happy with that if it was me.

Marcusm

4ensic15 wrote: »

The state gave mortgages.

A variety of measures were introduced including the reduction in rents, the writing off of arrears of rents, the compulsory sale and government funding. These were all methods by which property was passed from the gentry into the hands of what were substantially peasant tenant farmers and they involved the necessary, beneficial and laudable intervention by government which was effected from public funds. The mortgages would not have been available other than from government funds, the rent reductions and write offs would not have arisen but for government funds. Frankly, security of tenure and the ability to purchase would not have arisen but for government intervention.

I'm simply responding to an assertive libertarian position which, in the case of most Irish citizens, is the effect of pulling up a drawbridge having benefited in the past.

I'm not a socialist; I believe in small government, I adhere to the maxim in the Duke of Westminster case (government should be allowed to put the smallest shovel into my stores) but I can still see validity in an inheritance tax. Frankly I can see the relevance of a wealth tax (even though it would be to my disadvantage). I abhor the abandoning of water charges. I think the "abandon the poor and workshy" approach promoted by the poster to whom I responded to be shortsighted.

rsynnott

Incidentally, I'm always fascinated by those who simultaneously (a) moan about people on the dole feeling entitled to it and (b) moan about the awful injustice of only getting 310k unearned money for free before the government assesses a fairly modest tax on it. (For reference, 310k is about 30 years worth of the dole).

And, again, look at the distortion on the property market. The person with comfortably-off parents and no siblings, or well-off parents and a sibling or two, inherits 310k, tax free. How are people with less well off (or indeed merely longer-lived) parents supposed to compete with that? Inheritance enforces economic divisions; if anything the taxes should be higher and the thresholds smaller. This is arguably particularly the case now that people are having less kids.

LirW

It's not so much that he'd want the house, the parents would. We talked to friends and all of them would see their parents houses as burden the way it is because they all require an awful lot of work. It's not that these houses are in reasonable conditions, in our case it's a 1930s house that's freezing cold and not very well maintained and we know some that also would dread the work of updating the inherited house. So you'd easily have to invest 100k + again and that's not money everyone has lying around, especially if you don't earn a high enough salary.
Assuming we'd be renting because we couldn't get a loan to keep the house there wouldn't be a choice but sell really.
Anyway, I hope they live a long and prosper life, all of this is a headwreck that nobody wants (Just came out of a very messy inheritance war that completely split the family).