The Dementia Tax

[old_windbag]

We expect people to save for a rainy day or for their old age. But why would people bother to save if those savings/assets mean they don't get state help. e.g person A cuts back on holidays, pubs, etc. and puts as much aside as they can for their old age whilst person B does a spend, spend, spend; and when they get to old age person A does not get state help because they've been responsible whilst person B gets state help because they have no savings/assets. Person B has has a great life, travelled the world, unforgettable experiences and gets "bailed-out" by the state whilst person A has been "responsible", "done the right thing", forgone that fantastic life and now not only does not get state help but their taxes help pay for the state aid given to person B.

I agree with this and it can be seen on past posts of mine that I've rised exactly that issue. I know I was criticised for expecting state payments when in possesion of savings as that wasn't what the state is there for. Those criticisms I felt simply missed the point of my argument as Psmathe has highlighted above. Partly the situation I guess is confused by calling payments national insurance, it isn't really an insurance as it only pays out under specific financial conditions. To be a true insurance for all would then require much higher NI payments( or via tax as most of it is now ). I'm sure we could arrive at some working system that is fairer.

An alternative I'd pondered was that of using our tax payments to be invested in a government investment scheme( earning interest loaning to businesses etc ). At the time of retirement we would get an annuity based on a percentage of the fund saved with the government getting a part too( growing until death ). Then on death the fund amassed becomes the money to spend for the current financial year by govt( what would have been tax income ). It would require phasing in over time to ensure we always have tax fund for the present onward but once fully established it may work. So it would be the constant yearly death rate that would return a regular income stream from amassed funds meanwhile providing a pension too prior to death. You have to kick around all sorts of alternative ideas to try to find solutions to our extended lives etc.


SoftLips:

"It was the same with pensions until this government. I used to walk the dogs same time as an old guy who often grumbled he'd paid into the company pension all those years while his neighbour who did the same job at the same company paid nothing. Both now retired and the guy who had no work pension received state pension top up, had his rent paid etc. The guy who paid into his pension received nothing and was much worse off. The guy I knew was worse off when working as he paid into his pension and was worse off in retirement because he had a small pension."

I had this at a prior workplace, I grumbled about the pension situation and a woman on reception said "why pay into a pension, I don't because I know when I'm old I'll have access to all pension benefits you won't".......... sadly there was more than a grain of truth in her logic.

[al_yrpal]

I believe that not only us oldsters were pissed off by this stupid policy, but also the young who would be at risk of losing any possible inheritance. Double whammy! Totally unfair exploitation of sick weak and defenceless old folk in favour of the feckless who peed any possible wealth up the wall. Dementia is an illness no different from any other. And with any other illness they can't steal what it took a prudent lifetime to acquire.

Al

[mercalia]

quite a few here are putting the argument forward against the madness tax ( was mad of May to suggest it ) that why bother to save for old age if you can get it free later by spending it all now?

well the reply is you have to be pretty poor to get it for free and calculating how much to spend over 40 years or so , so you will be eligible is impossible? By the time you fully own your home, after paying off the mortgage is too late to really start cashing in to get later services for free?

The idea that dementia is an illness like any other maybe be true so what? The NHS does have a list of the various treatments it supplies, not anything goes? eg Stem cell thearpy - until recently they wouldnt provide a 2nd treatment should the first fail; there was org38 case of a young mum whose friends used that to petition a change ( and won ). I dont see why I should pay for your horrendously expensive care that can go on for years where it not a matter of a cure while you sit on assets in the £100,000s

[thirdcrank]

I'm sure somebody will correct me but I'm pretty sure that the separation of personal and nursing care and charging for the former was introduced under the Thatcher government. I also believe that the only significant change since then was when Blunkett made an announcement about people not being forced to sell their homes to pay for care (not spelling out that he was introducing loans secured on the value of the house.) I was under the impression that was a national policy administered locally but during this most recent debate it's been pointed out that not all local authorities offer this option.

The underlying agenda is that it's the moneymen who would like to offer financial "products" based on second mortgages and life assurance. The problem is that without a cap, the actuaries can't actuarate or whatever it is that actuaries call thinking of a number, doubling it etc.

[old_windbag]

but also the young who would be at risk of losing any possible inheritance.

It could be seen that those who take state benefits without any intention of ever working are "feckless". But I don't see people who recieve a handsome inheritance from a property sale and also "expect" their inheritance as any different. It fuels the property market penalising those who aren't in a position to receive such amounts from poorer parents. Not because those parents didn't work hard but simply as they were on low wages, or hit circumstances that limited their income or simply were too honest to creep up the salary ladder. It also funds the german car market as more often than not it'll be an audi, merc, bmw that the new rich invest in. So for offspring not to receive inheritance and have to "work" for what they get I feel is a better life lesson and also maintains a more level playing field generation to generation. Also personally, earned money feels good compared to being a parasite on the hard work of others. It'd be great if put in trust for charitable purposes( perhaps we'd cure dementia quicker amongst many issues ) but offspring won't think that way.

Remember the upper classes who have such huge wealth have got that by continually passing on their riches to their offspring over many generations wealth accumulating. Quite often starting out by feudally taking property and land, now over hundreds of years it's viewed as legitimate. But their example is not held in high regard amongst many on here.

[mercalia]

but also the young who would be at risk of losing any possible inheritance.

It could be seen that those who take state benefits without any intention of ever working are "feckless". But I don't see people who recieve a handsome inheritance from a property sale and also "expect" their inheritance as any different. It fuels the property market penalising those who aren't in a position to receive such amounts from poorer parents. Not because those parents didn't work hard but simply as they were on low wages, or hit circumstances that limited their income or simply were too honest to creep up the salary ladder. It also funds the german car market as more often than not it'll be an audi, merc, bmw that the new rich invest in. So for offspring not to receive inheritance and have to "work" for what they get I feel is a better life lesson and also maintains a more level playing field generation to generation. Also personally, earned money feels good compared to being a parasite on the hard work of others. It'd be great if put in trust for charitable purposes( perhaps we'd cure dementia quicker amongst many issues ) but offspring won't think that way.

Remember the upper classes who have such huge wealth have got that by continually passing on their riches to their offspring over many generations wealth accumulating. Quite often starting out by feudally taking property and land, now over hundreds of years it's viewed as legitimate. But their example is not held in high regard amongst many on here.

or even worse selling slaves to the plantations in the Americas?

[softlips]

I believe that not only us oldsters were pissed off by this stupid policy, but also the young who would be at risk of losing any possible inheritance. Double whammy! Totally unfair exploitation of sick weak and defenceless old folk in favour of the feckless who peed any possible wealth up the wall. Dementia is an illness no different from any other. And with any other illness they can't steal what it took a prudent lifetime to acquire.

Al

But your children would inherit £100,000 under this proposed scheme whereas now it can drop to just over £14,000 in exactly the same situation. My sister and I know, we'd have been £60-£70,000 better off after our mothers death last year.

This isn't anything to do with dementia, it's any care, it's Labour who have named it the dementia tax.

I repeat, my mother didn't have dementia, she had MS. The local council registered a charge against her property to fund her care, this money was deducted at the time of sale. Her home was sold for £160,000, the council took £118,000. Under the proposed changes they could only have taken £60,000.

[thirdcrank]

but also the young who would be at risk of losing any possible inheritance.

It could be seen that those who take state benefits without any intention of ever working are "feckless". But I don't see people who recieve a handsome inheritance from a property sale and also "expect" their inheritance as any different. It fuels the property market penalising those who aren't in a position to receive such amounts from poorer parents. Not because those parents didn't work hard but simply as they were on low wages, or hit circumstances that limited their income or simply were too honest to creep up the salary ladder. It also funds the german car market as more often than not it'll be an audi, merc, bmw that the new rich invest in. So for offspring not to receive inheritance and have to "work" for what they get I feel is a better life lesson and also maintains a more level playing field generation to generation. Also personally, earned money feels good compared to being a parasite on the hard work of others. It'd be great if put in trust for charitable purposes( perhaps we'd cure dementia quicker amongst many issues ) but offspring won't think that way.

Remember the upper classes who have such huge wealth have got that by continually passing on their riches to their offspring over many generations wealth accumulating. Quite often starting out by feudally taking property and land, now over hundreds of years it's viewed as legitimate. But their example is not held in high regard amongst many on here.

The underlying logic here is an inheritance tax at 100%. Then, as you can't take it with you and cannot pass it on, the logic is to spend it rather than save for the proverbial rainy day. Apart from anything else, I should have thought that that would increase rather than lessen the sales of Vorsprung durch bedrug motors. I'm always happy to declare my interest. My seventieth birthday present to myself was an Audi Quattro - way above the level of the modest models I bought when I was scrimping and saving.

[meic]

Oh dear, is this the end of TC's clean driving licence?

[old_windbag]

The underlying logic here is an inheritance tax at 100%

That could be so...... But in reality most of us would be unable to do a controlled burn of our savings Prior to death as in most cases we cannot predict that or may not be in a state to see it coming. Tangible assets like houses could be problematic to spend. I think to put your earned money and estate value, sold assets etc, in a trust of sorts on death paying out into worthy causes that help us fix illnesses, help animals or humans in distress or need is surely more valuable than helping progeny who are more than capable of standing on their own feet. Thats not being harsh simply expecting adults to be self supporting and not think they should be given large handouts. 100% inheritance tax would be fine but i personally would not agree with how a government would use that money.... They are incompotent at so much and waste tax on so many schemes. Hence the altruistic outlook allocating your reserves on death to beneficial causes of choice outside of relatives. There are many research programmes into many conditions that i'm sure would benefit from that financial input as governments are unlikely to increase that. So in essence on death you could leave a beneficial legacy, not just a consumerist one. Perhaps not the normal way of thinking but i feel a more compassionate, caring one. I'm sure most will disagree.

Remember when you die the quattro will still have some cash value, not a lot, but still some

[thirdcrank]

In essence, give it all to charity and let them decide who merits the hand-outs: and leaving it to charity is tax effective.

[Psamathe]

but also the young who would be at risk of losing any possible inheritance.

It could be seen that those who take state benefits without any intention of ever working are "feckless". But I don't see people who recieve a handsome inheritance from a property sale and also "expect" their inheritance as any different. It fuels the property market penalising those who aren't in a position to receive such amounts from poorer parents. Not because those parents didn't work hard but simply as they were on low wages, or hit circumstances that limited their income or simply were too honest to creep up the salary ladder. It also funds the german car market as more often than not it'll be an audi, merc, bmw that the new rich invest in. So for offspring not to receive inheritance and have to "work" for what they get I feel is a better life lesson and also maintains a more level playing field generation to generation. Also personally, earned money feels good compared to being a parasite on the hard work of others. It'd be great if put in trust for charitable purposes( perhaps we'd cure dementia quicker amongst many issues ) but offspring won't think that way.

Remember the upper classes who have such huge wealth have got that by continually passing on their riches to their offspring over many generations wealth accumulating. Quite often starting out by feudally taking property and land, now over hundreds of years it's viewed as legitimate. But their example is not held in high regard amongst many on here.

The underlying logic here is an inheritance tax at 100%. Then, as you can't take it with you and cannot pass it on, the logic is to spend it rather than save for the proverbial rainy day. Apart from anything else, I should have thought that that would increase rather than lessen the sales of Vorsprung durch bedrug motors. I'm always happy to declare my interest. My seventieth birthday present to myself was an Audi Quattro - way above the level of the modest models I bought when I was scrimping and saving.

The difficulty I see with that is that you have to give people some reason to save for a "rainy day" (or for their old age). Saying to them that if they are frugal in younger times (forgoing luxuries they can afford) then in later life state will just take it all away (either directly through 100% inheritance tax or indirectly by means testing savings/assets) then what motivation do they have to save anything ?

Ian

[thirdcrank]

Just to spell this out: I'm not proposing any tax change, just analysing the post I was responding to.

[Psamathe]

I don't know the answer to this and I wonder if there is no answer to this problem because the underlying cause is the high inequality in our society; Poorer end faces terrible conditions whilst upper end live fabulously in excess. If there were not such inequality then the poorer end would have decent quality care whilst the upper end would also have decent quality care, but maybe they can afford a bottle of wine a week and a few small luxuries.

Estates passed to children at upper ends can be many millions and at lower end nothing. We see kids who've never had a job (and could never hold one down for more than a few hours) become millionaires and spend their time partying.

Even out that inequality and a lot of these issues become a lot easier to find solutions to. People save and pass a few thousand to their children and nobody is unduly concerned because everybody is getting an acceptable level of care.

Ian

[thirdcrank]

Me on p1 of this thread:

I think one solution will come a lot quicker than expected in the form of a revised definition of death to include those with severe dementia. I'm not talking about euthanasia, but rather accepting that anybody whose mind has gone is dead, even if their body would be OK for another decade or so. The reflex response is that it couldn't happen here, but it could and will. Also when it does, I think it will be the floodgates scenario. Shipman threw a spanner into the works by apparently doing it for his own fun and he perhaps concentrated attention on something that had been happening discreetly for a long time, but I'm convinced that's only been a temporary break in the trend. I'd point to the change in attitudes to abortion in the 50 years since 1967.

Today:

Supreme Court backs agreed end-of-life decisions
Legal permission will no longer be required to end care for patients in a long-term permanent vegetative state, the Supreme Court has ruled.
It will now be easier to withdraw food and liquid to allow such patients to die. ...

https://www.bbc.co.uk/news/uk-45003947

You ain't seen nothing yet.