The surprising tax “loop hole” you probably don’t know about

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@user-xu5vl5th9n 8 сағат бұрын

Given how previous governments have raided pensions and how so many people lost out hugely when defined benefit schemes were shut down (except for the public sector), this new move starts to look slimy. The government keeps telling us to be on the look out for "pension scams" and people who might be trying to steal our pensions, they just forgot to say they were the ones doing it.

@stephencole9289 11 сағат бұрын

"Gifts out of surplus income" - a useful option, but documentation (and regularity) are key. Other presenters/experts mention that, to there knowledge, only a few thousand people in the UK are using it, and that HMRC scrutinize it carefully. Doing it whilst still employed is better (out of already taxed income), whereas doing after retirement means have to draw more out of pension to cover it and will affect your post-retirement income tax position.

@davidp4456 Күн бұрын

Accountants talk calmly and objectively about complex tax laws, but if you step back for a moment don’t you think that this level of HMRC intrusion into our personal financial choices is absolutely unacceptable and disgraceful ?

@dontuno 23 сағат бұрын

Most definitely!

@saelaird 19 сағат бұрын

Yes it's absolutely abhorrent, yet very few people seem to mind. I think they're either crazy or inept. Tax is organised theft, essentially... and it only ever seems to get more intrusive, invasive and fundamentally inefficient. The UK is cooked.

@UKGeezer 18 сағат бұрын

YES 100% it is.

@clone907 16 сағат бұрын

Not really. ‘Twas ever thus. I don’t object to I being taxed, but I do object to my taxes being spaffed in the direction of the likes of Mone.

@user-xu5vl5th9n 8 сағат бұрын

@@clone907 It cuts both ways. Tax payers are expected to be moral agents. But so does HMRC and the government in how they raise taxes. There is a lot of talk about aggressive tax avoidance schemes being immoral, but hardly anything about the immorality of some forms of taxation.

@carldaniel3155 6 сағат бұрын

Filing in the IHT403 form is a total nightmare... very confusing for recording gifts out of income!!

@bikeman123 14 сағат бұрын

No tax of the defined benefit death benefit for public sector pensions though. How is that fair?

@martinh9099 9 сағат бұрын

I'm in receipt of a public sector pension...I'm not aware of any "death benefits"..do you mean death in service while you're working? This is no longer applicable once you retire

@user-ek8ey7pz9m 23 сағат бұрын

Second career option.. Audio Books.. what a sexy voice, could listen to all day

@triumphthunderbird1 Күн бұрын

Thank you Dianne. Grateful for your advice!! The labyrinth of tax is a minefield! The incumbent clowns have incentivised me, and others like me, to sit this administration out. Wait for the adults to come in and take control, whoever that might be!

@secretstacker 14 сағат бұрын

Great vid is better to give with warm hands than cold 🔥🔥

@stephencole9289 11 сағат бұрын

Re IHT taxation of pension pot. If use a portion to take out an annunity eg a 'joint life, second death' covering yourself and spouse, then that uses up a chuck and removes it from the pension pot, and from inheritance tax, right? And so balancing out how use use any pension pot to meet income and inheritance requirements, and minimize tax, is an interesting and vital balancing act.

@dontuno 23 сағат бұрын

"Gifts out of surplus income" is something I intend to use more and more, but I'm still not in drawdown, ergo no "income" and frankly have enough cash to see me through to the inevitable end. However, I was fortunate to receive a £50K premium bond win which I would regard as "surplus" income, but would HMRC? Like another who has commented, I intend to sit out this pitiful excuse of a government in the (possibly forlorn) hope the next reverses the IHT tax treatment or one which at least raises the threshold to at least twice, and if not more than the current one, which I believe has been fixed since 2012.

@davidbiran4572 17 сағат бұрын

As such a win is a one-off occurrence, it would not be considered income. You could of course gift it and hope you survive 7 years from the date of the gift, at which point it falls out of IHT liability. (Or you could buy a 7-year term life insurance to cover 40% of the gift, making sure that the beneficiary of the insurance policy is the person to whom you made the gift. It's a relatively cheap way of making sure that IHT does not apply to the gift).

@Suspended4thYT 15 сағат бұрын

@@davidbiran4572 Wouldn't even need that. The 7-year rule is tapered - see below Years between gift and death - Rate of tax on the gift 0 to 2 years - 40% 3 to 4 years - 32% 4 to 5 years - 24% 5 to 6 years - 16% 6 to 7 years - 8% 7 or more - 0%

@davidbiran4572 14 сағат бұрын

@@Suspended4thYT You are correct of course; I was trying to simplify. Having checked extensively about this with various insurance companies, it transpires that if you are reasonably young (50s to mid 60s) and in good health, a flat-rate 7-year term insurance policy can be cheaper than a declining policy (or a set of fixed-term policies, eg for 1, 2, 3, 4, & 7 years). If you are in your 70s the declining payout policy is usually cheaper.

@linyarin 18 сағат бұрын

I have watched many, many videos on IHT and this is the first one that actually explains it clearly and has managed to set my mind at rest. Thank you and very much appreciated.

@Bracebarian 20 сағат бұрын

Thanks for this vLog, its an interesting way to provide a legacy. You said that IHT is paid on the second death of a couple, so if if a couple gives their children a PET gift from capital or savings to help with buying a house does that mean that the 7 year rule is for both lives? If one of the couple dies within 7 years of the gift is IHT liable on the death of the 2nd even though it may be 10 years after the gift?

@mrethicpreneur7510 8 сағат бұрын

Is there any cap on the amount gifted?

@rinakaur7245 19 сағат бұрын

So gifts out of capital over 7 years old would be subject to IHT?

@kevinsaunby982 17 сағат бұрын

No. Any gift made more than 7 years before death is ignored for IHT purposes and indeed any gift made within 7 years of death is subject to IHT but can be tapered depending on how long before death it was made. Google for tapering table - affects 3-7 year time period ie if 6-7 year old gift only 8% of the gift is subject to IHT

@davidbiran4572 17 сағат бұрын

If you survive 7 years after the date of any gift, that gift is no longer subject to IHT.

@ianbarnes961 20 сағат бұрын

Can't DB pensions be partially bequeathed to someone? Or is that at the whim of the trustees?

@Ree-m5p 16 сағат бұрын

You did not mention in this video how much can be gifted without the other party being taxed on it? You also didn’t advise on the changes from 2026 onwards. Can you explain more about that please

@davidbiran4572 14 сағат бұрын

The beneficiary pays no tax - it does not count as their income or capital gains. The IHT changes do not affect gifting from surplus income.

@Ree-m5p 13 сағат бұрын

@ ah ok thank you ☺️

@711honved 20 сағат бұрын

We are being squeezed by a government that sees us nothing other than tax cows. All we have to look forward to is tax, tax & more tax! We'll have nothing but the billionaires at the World Economic Forum say we'll be happier!

@DrRock2009 20 сағат бұрын

Gov is bankrupt. UK pensions are c£150% of GDP. What a surprise the gov are raided pensions….🤔

@wendyadams5232 18 сағат бұрын

ask them in North Korea and the answer is live in fear not be happier

@Ree-m5p 17 сағат бұрын

It’s more than squeezed its financial assault

@iancowle6268 17 сағат бұрын

I'm about to retire and on the form I have to sign, it states that I am not allowed to pay any of my tax free lump sum into a registered pension scheme. Do you know why that is?

@davidbiran4572 17 сағат бұрын

Because it's considered a type of "tax laundering" - you got tax relief once when paying into the pension, and this would give you a second lot of tax relief.

@iancowle6268 13 сағат бұрын

@davidbiran4572 Thanks for your reply. That makes sense, but would it be allowed if I instructed the pension company not to claim the tax relief on my behalf?

@adrianl5899 9 сағат бұрын

If you search 'Royal London Recycling of tax-free cash' you'll find a useful web page for advisors (but accessible to all) which has a handy chart about this topic and what can and cannot be done. On your second question, what is your thinking for the purpose to do this?

@simonbrown8509 6 сағат бұрын

It's about the revenue wanting to avoid giving tax benefits out twice.

@UKGeezer 18 сағат бұрын

Just for once, it would be nice to own something that the government doesn't want to take from you. Tax is already paid on money you earn as income. What business is it of the government what I do with my money after that? And what's to stop me from just withdrawing cash and giving it to someone?

@TemaAhmed-dd5wm 15 сағат бұрын

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@TemaAhmed-dd5wm 15 сағат бұрын

I was a stay at Home mom with no money in my IRA or any savings of my own, which was scary at 53 years of age. Three years ago I got a part time job and save everything I make. After 3 years, I am 56 yo and have put $9,000 in an IRA and $40,000 in my portfolio with CFA, Dorian j Townsend. Since the goal of getting a job was to invest for retirement and NOT up my lifestyle, I was able to scale this quickly to $150,000. If I can do this in a year, anyone can.

@TemaAhmed-dd5wm 15 сағат бұрын

she's mostly on Telegrams, with the user name.

@TemaAhmed-dd5wm 15 сағат бұрын

Dorianjtownsend 💯

@user-wr5yl3jf9j 15 сағат бұрын

thank you so much

@mikecouthor 15 сағат бұрын

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@garyreilly1544 Күн бұрын

When does income become capital?

@saelaird 19 сағат бұрын

When it's exchanged for an asset.

@davidbiran4572 17 сағат бұрын

HMRC allows income to remain classified as income for 2 years - after that it is considered capital. See HMRC Manual IHTM 14250.

@danieltroska5480 17 сағат бұрын

Hello miss sullivan really could do with hand in a very origional situation,help!please.

@MrTpain1945 22 сағат бұрын

So after 2027 are pensions still passed on tax free if you die before you are 75

@nickhardy7310 20 сағат бұрын

No. After April 2027 a percentage will be stolen by a protection racket.

@alangordon3283 19 сағат бұрын

No.

@adrianl5899 8 сағат бұрын

Proposal: to spouse/civil partner, yes. To other, no. Since it went out for consultation and pensions come in very many different forms, it's a case of waiting for the fine detail of what's eventually passed.

@helenskelton4993 18 сағат бұрын

I am single, on my death would I have to pay inheritance tax if I nominated my closest relative e.g. sister or niece?

@Ree-m5p 16 сағат бұрын

Yes you will - check out the new legislation this government put in place - 100% of it will go to the tax man

@adrianl5899 9 сағат бұрын

Inheritance Tax may be due on the estate. If you look up 'IHT nil rate bands' and 'IHT tax thresholds' you'll learn more. A wills and probate solicitor can make a will and help run through the specifics of your situation. If very complex (trusts etc.), a STEP qualified one may be useful.

@pauldavidthomasfrodo 15 сағат бұрын

Any financial information is always useful. I find your presentation of very useful information too fast. If you could just slow your speech a tad you might find more market penetration. Keep up the good work.