Chancellor could help bank of nan and grandad

SO CHANCELLOR Philip Hammond has asked the Office for Tax Simplification to have a look at all aspects of inheritance tax, which if properly reorganised could prove to be a big vote winner at the next election.

At present, any grandparent can gift a sum of £3,000 every year without incurring tax penalties.

This threshold was established in 1981 so is long overdue for an update, especially at a time when it is increasingly difficult for the young to acquire a mortgage.

If the current level was just updated, then that would equate today to a sum in excess of £12,000, a better help towards putting down the mandatory deposit.

However, I feel the Chancellor could go much farther.

At a stroke it would enable the younger generation, helped by families, to buy their own homes, thus encouraging house-builders to expand, creating more jobs

There would also be a social benefit in owning one’s own property, thus avoiding rent payments.

It would enable owners to reap the benefit in later years when they came to trade in their homes.

I have seven grandchildren, but only one has been able to get on the property ladder.

Three would dearly love to have their own home, but cannot scrape together the substantial initial deposit required.

So in their mid-twenties, they are renting. In order to try and treat all the same, dividing my £3,000 allowance would not go far.

Hence the good case for Mr Hammond to remodel legislation in relation to gifts, permitting at the very least, a sum of £25,000 per year to be made tax free.

If he was really smart, he could design a scheme where a fixed sum per annum per family beneficiary could be constructed.

By so doing, members of large families would have an equal chance in the market place, and would not be penalised.

A little sensible planning could prove to be very attractive to the electorate at the next General Election, and as things are

All it needs is fairness, nerve and a little political foresight.