Can I avoid inheritance tax by taking my family on £100k trip? Yes pic.twitter.com/apjNrDmCZx

— Henry Tapper (@henryhtapper) April 13, 2024

One of the issues that the youngsters have with the boomers is “wealth”. Old people own all the property and the liquid savings, youngsters rent and live off their overdrafts.

When John Major had his vision of “wealth cascading down the generations”, wasn’t he inspiring us boomers to go for it? Many of us have and now we have the chance to spend our money on our family. This afternoon I have bought the tickets for Yeovil v Dartford for my pair of young guests.

This may not quite be the £100,000 holiday anticipated by the Telegraph’s Mr Anonymous, but it’s the closest I’m getting this weekend. A lifetime working and saving allows us to indulge.

The idea that there will be inquests into whether the sharing of wealth through communal activities as varied as watching a football match or going on a world cruise is absurd, The state has no remit to determine how money is spent and when it’s gone it’s gone.

Most importantly, the economy needs money to be recycled and not hoarded. Illiquid assets, such as property and chattels are inheritable but memories cannot and should not be taxed, they are spent money and have no financial value. They are of course the things that we value most about our relationship with those who have died.

The Telegraph’s article asks the question about the consequences of spending but there is another question , which is about not spending in later life. The incapacity of many older people to spend is a very big questions for pension people and it is an ongoing worry for the many of us who consider the issue of wealth.

A pension dies with you as does an annuity. Converting wealth to an income for life can be considered an act of selfishness by younger generations who might consider themselves entitled to the proceeds of their parent’s retirement savings. We are in danger of creating resentment by converting our pots to pensions , we might even be considered selfish for being a member of a DB scheme. This might seem fanciful but one of the main levers for the taking of CETVs was the guilt people felt when they discovered that SIPPs were inheritable and pensions weren’t.

It has been good discussing this, this weekend with people under 30 who have a keen interest in these matters. When I talk about intergenerational solidarity, I think about the bond between generations created by the mutual gratification that comes from taking care of each other. There are three generations of us spending a weekend in a house party. We are speaking very openly about these responsibilities. Financial responsibilities are very low on the list of priorities.

If I have a reason to want to see the end of inheritance tax , it is the negative impact it can have on family relationships. If the aim of Government is to further the happiness of all generations , then a tax that seems to cause such concern is surely destructive. By comparison , a tax on wealth in the hands of the wealthy seems a more constructive approach.

If we can encourage the handover of un-needed wealth by those in the later stages of life, then we might some of the legitimate gripes of younger people. In particular the rules surrounding “interest in possession” could be eased to allow family units to be maintained. Children who live with elderly parents are natural carers and reduce strain on our care system. Those who have no property can look forward to inheriting the family home without having to kick the parents out to create a lifetime gift. And lifetime mortgages should be encouraged to supplement the income that is often too slight to maintain properties.

Spend your wealth why don’t you?

Whether it be via a shared holiday costing £100,000 or a purchase of a later life annuity/pension, the spending of wealth owned by the elderly is greatly to be encouraged.

It should not be a cause of issue to a younger generation unless there is a scam involved. Instead of worrying about inheritance tax, elderly people and their children should be getting on with living their best life, while they are still together.