Talk Morgan Forums Community The Malvern Arms Financial planning: what indexes are you using?

I stand partially corrected, I thought art was CGT exempt, but it's still only taxed at 28% if you hold it for more than a year.

According to this, watches are exempt

https://www.gov.uk/capital-gains-tax-personal-possessions/limited-lifespan

Patek Phillipe need to change their key advertising slogan otherwise they will hit the CGT issue

Just sold my business so CGT to pay but reduced to 10% (Business Asset Relief- Entrepreneurs Relief) - paid a lot of income tax over the years though.

Also built up an investment portfolio over the years from post tax savings - if a government attempted a wealth tax on this I would implement extremely aggressive avoidance measures.

Yep, that was quite handy for me too. Just don't get tempted to go back into the same business, they'll have you under the Phoenix legislation and make you pay the rest of it.

Not quite that simple. There is no capital gain in inflation which is why at one time we had an inflation allowance in calculating capital gains. I guess they dropped it because many people couldnt work out the simple sums involved but arguably its the only way of handling capital gains.

Having worked for British Steel, I have been dropped in the cart by Tata, who have allowed the pension scheme to collapse meaning that I am now without any protection against inflation. My pension is fixed in £. But like Hamwich I have long messed around with spreadsheets and forecasts and am reasonably confident that we will be OK barring German style runaway inflation. In saying that I am planning on inflation averaging 5% ( actual 3.3% over 30 years), dividend income averaging 2.6% ( actual 3.1%) dividend growth of 2% pa. I do not monitor my spending - at 76 I find that I dont really want to spend much anyway. My issue TBH is that whilst on the above assumptions there will be a hefty IHT bill, I cant see my way to giving yet more to the kids because of the fixed pension and the risk of runaway inflation. First duty is to make sure SWMBO is well protected.

I would disagree with Hamwich and the 5% on property. The latter has tended to march hand in hand with equities, is currently very toppy indeed ( imagine what is going to happen if interest rates rise and people once again have to pay say 7 or 8% on mortgages)

Final comment. Both Hamwich and myself will be wrong. The future is unknown and unknowable.

What about setting up a trust so that first to die your 50% share of house goes to kids?

Interesting that inflation is only 3.3% average of the last 30 years, might be misleading as to the inflationary impact any individual experiences, for example mortgage interest rates has fallen dramatically over the last 30 years, but if you don't have a mortgage ! Yet petrol /fuel has nearly doubled in price since the Millennium, gas and electricity prices are doubling overnight and will continue to show an upward trend.

The inflationary impact you might experience maybe very different to the national average % according to what inflationary pressures are being exerted on your current spending profile in that eg if a great proportion of your expenditure experience is say heat and light then the recent increases are going to have a much greater impact on you than the UK average % impact might suggest.

In that instance it better be a well written, managed and established trust or a whole host of issues could ensue.

Don’t think it is a trust actually - just a properly written will but house tenancy needs altering from joint tenancy to 50/50 ownership - tenants in common.

+1. We did ours a couple of months ago.