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Willy’s will will be interesting

‘Money is like muck,” wrote Francis Bacon in 1625. “Not good except it be spread.” No one accuses the father of the scientific method and British empiricism of being a socialist, although doubtless the many Tory critics of inheritance tax will now want to group him with Karl Marx and the liberal elite as dark enemies of aspiration.

They should also add the Greek philosopher Aristotle to their list of leftwing enemies. “Man is by nature a social animal,” he wrote. “Society precedes the individual. Anyone who either cannot lead the common life or is so self-sufficient not to need to, and therefore does not partake of society, is either a beast or a god.”

Inheritance tax is a good thing because it breaks up concentrations of wealth.

Hmm, well, OK. I argue the other way myself – it’s glorious that bit by bit the population builds up wealth to make them free of government.

But Willy. He’s been on £ quarter million a year for some decades now. At one point his (late) wife’s buy to let empire included 10 properties if I’ve remembered that right. There’s significant wealth built up there. Obviously, his wife’s estate didn’t pay tax on what passed on to him. But his estate will be – I would assume at lesat – something substantial.

So, what lifetime gifts is he making to reduce that impact? What efforts to reduce the value of the pot subject to such tax? Any ag land? AIM shares? DC pension pot?

Enquiring minds would just love to know whether he’s making plans to maximise wealth passed on. You know, in those interests of transparency. For a reasonable bet would be that his likely estate will be large enough to make considerable contortions worthwhile.

23 thoughts on “Willy’s will will be interesting”

  1. Inheritance Tax is an easy win for any Government: it brings in constant and simple to grab tax revenue. Despite it being a constant source of low level mumbling discontent it’s only really pertinent to a very small percentage of the population at any one time. It only adds up to a reasonable percentage over a lifetime. As such they could increase it by 5% and not get a huge reaction. Contrast that to income tax where that 5% increase would hit everyone at once and it would be game over. Similarly abolishing Inheritance Tax would win some votes but not nearly enough to compensate for the rhetoric about the Tory bastards doing it to help their wealthy friends.

  2. If Willy is making plans to maximise wealth passed on there will be ‘reasons’. Perhaps he doesn’t want the Government (especially if it’s Tory) to use his inheritance for purposes he doesn’t agree with. Perhaps he thinks his inheritance will be devalued by being broken up.

    The ‘reasons’ can be both true and an excuse for private benefit at the same time.

  3. @Andyf

    And of course since inheritance tax generates comparatively little revenue it would make a good ‘sacrifice’ for political purposes. The criticism for it’s abolition would probably be worth enduring for the political benefit of being a tax cutting Administration.

  4. ‘The 30% of the population who crazily think they may be liable to inheritance tax (the actual number is 4%) need to be assured there is no risk.’

    I’m sure you believe this!!

  5. To be nitpicking, the “father of the scientific method”was actually Roger Bacon 1219-1292. At the time, being “knowledgeable” meant having uncritically read the Greeks. Our Rog conducted experiments at the University of Paris which showed that much of Greek knowledge was actually Greek bollocks. He was also believed to have invented the sandwich which took his name. Although it was originally made with mutton, French bacon as we all know being inedible.

  6. Never tried French bacon BiS. I’ll have to ask my sister what she thinks of it. She lived there for years.

  7. Talking of Aristotle and socialism, he said “That which is owned by the greatest number has the least care bestowed upon it”.

  8. A great state left to an heir, is as a lure to all the birds of prey round about, to seize on him, if he be not the better stablished in years and judgment. Likewise glorious gifts and foundations, are like sacrifices without salt; and but the painted sepulchres of alms, which soon will putrefy, and corrupt inwardly. Therefore measure not thine advancements, by quantity, but frame them by measure: and defer not charities till death; for, certainly, if a man weigh it rightly, he that doth so, is rather liberal of another man’s, than of his own.

    I have a suspicion that Master Hutton did just avail himself of the tools of the great demon Google and did not actually read Bacon’s essay “Of Riches”.

  9. Used finely diced as “lardons” in cooking, Boganboy. Lengthy boiling in red wine greatly improves it, as it does many things. See bœuf bourgignon which can undetectably be made with horse or crocodile if your short on bœufs.

  10. The other point of voyrse is that ad the current Boomer population dies off, many many more will be liable fir IHT because so many own their own homes ( or multiple ) that are now worth considerable sums.

  11. Thanks BiS. Maybe I’ll give it a try when I next cook up some of my rubbish bin stew.

    But I’d be more likely to just swill the red wine down neat rather than use it for cooking.

  12. But I’d be more likely to just swill the red wine down neat rather than use it for cooking.

    Cooking is a good way of getting value from the reds of lesser quality.

  13. Martin Near The M25

    The death tax threshold isn’t that high. I imagine these days a typical semi in a completely randomly chosen area like oh I don’t know, Ely, for example, could be enough to make someone liable to pay it.

  14. You could look to see whether, on his wife’s death, a trust was set up, either by her will or by his deed of variation. Trusts are to be public knowledge;edge now, aren’t they? Of course if a trust was set up and subsequently wound up before the new laws came in it might not be traceable by the public.

    The trust doesn’t of itself reduce inheritance tax but it lets you make IHT-avoiding gifts without giving up all control of the assets.

  15. Of course, inheritance tax to prevent concentration of wealth is unnecessary, or the descendants of Croesus and Crassus would be trillionaires by now. Even now, crackhead grandchildren can be guaranteed to destroy a fortune.

  16. @Boganboy

    Whether you believe that quote or not (“The 30% of the population who crazily think they may be liable to inheritance tax need to be assured there is no risk.”), I think it shows the thinking of so many advocates of more taxes – fairness and justice are unimportant, as the point is to have taxes that unfairly fall on others.

  17. A point I’ve not seen elsewhere and not wholly an answer. How many people think they might inherit from an estate? Sure, it might be only 4% of estates that get taxed. But if there are 10 hoping to get a piece of each estate then….thinking of my Mum’s estate (some of which is pass through from Pops and also, to emphasise, is not due yet, we’re all off to her 90th next week) there are four we know of in there. It doesn’t require that much of an increase from that as an average of hopefuls.

  18. Charles, just this morning I checked up on ‘Tax Freedom day’ (the day after HMG have stopped taking ALL our income in taxation one way or another from the 1st of January each year) for this year.
    In 2022 it was on the 3rd of June, this year 18th of June, just two weeks shy of 6 months.

    I wonder just what TPTB are going to ‘invest’ all that extra hard earned (OUR hard earned) on?

  19. @Addolff – “I wonder just what TPTB are going to ‘invest’ all that extra hard earned (OUR hard earned) on?”

    Paying the interest on the national debt. We have failed to pay off debt in prosperous times, so having been hit with Covid etc, we now have a huge debt. And interest rates are rising, so we’ll have to have cuts to services *and* higher taxes.

  20. “so having been hit with Covid etc”

    Pursuing DM’s directive:

    “so having been hit with the Government’s retarded and imbecilic over-reaction to Covid etc”


  21. Charles, I think the only ‘prosperous times’ I recall in the last quarter century was during the noughties, when Labour spunked all the money they could (and vast amounts more – through PFI). We then had the financial crash.
    The overdraft and credit card had both been hammered way before covid…………

    And another thing. BluLabour have said they will raise the national living wage by 15%. How can they tell us people asking for a pay increase above the rate of inflation is ‘inflationary’ but they can raise the NLW by over double the rate of inflation and that’s OK?

  22. Prosperous times can be relative. Today we have to pay the much higher interest on the public borrowing. If we had made the same effort a few years ago and had a surplus, we could have paid off some of it. We might even have established a level of spending that did not require ever more borrowing.

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