Shift debt to 0% while you can! | Car Finance update | ISA & inheritance tax

Martin Lewis (0:01)

Even if you put a complaint in, you would be lucky if it's at the end of 2027 If you have a substantial amount of debt that you're not sleeping about at night and that you can't cope with, here's what I would do. It could also see the end of all Mastery Dress Skins, which I think was a really, really good change. You have that amount of eligible credit. It is there.

Use it.

Hello, I'm Martin Lewis, and this is the cummingly named The Martin Lewis Podcast. I do wonder what that's gonna be about. And this is our Big Topic episode and each week we lead on one main subject to help you save. Usually most of it comes from my BBC Radio 5 live show with Adrian Chiles, but there's also bonus money saving tips and tricks just for you lucky, lucky podcast listeners. And in today's pod, the big topic is for everybody who has existing debt on credit and store cards. In a nutshell, I'm concerned the deals available to cut the cost are about to get worse and they're gonna get worse rapidly, so you need to sort it sooner. I'm gonna run through how balance transfers work, the best deals, how to maximize your chances of acceptance, cards versus loans, and a lot lot more. So that's a must listen if you've got debt on credit cards. I've also got an update on car finance misselling. I know millions are waiting for the news. Well, we finally have a date for the next steps, and I'll talk you through what that means. This week's Tell Us, what do you or have you spent on that you quietly hid or downplayed to your partner or child or parent? And did they ever find out? And your answers include scuba kips, agreements between partners not to tell each other, and even a hidden horse with some very good puns generated on the back of it. Then it's on to Mastermind, and this week the question is all about whether ISIS count towards your inheritance tax allowance. And you get the joy of listening to my Dumbledore impression. Don't ask yet. And then to finish, I'm getting some stick from an Olympian.

Play the theme tune.

SPEAKER_2 (2:08)

I've got a question for Matt in inheritance tax from a neighbour of mine who is on the...

Martin Lewis (2:12)

That's how you get in touch now, is it? If you're a neighbour of Adrian's, just knock on his door, ask him a question.

SPEAKER_2 (2:17)

Exactly. Well, he always feels sorry for me when with your questions, when you bamboozle me with the mastermind.

Adrian Chiles (2:23)

It's a tough one for me.

SPEAKER_2 (2:24)

So, yes, he says, if a surviving spouse has assets of 450k in property and 500k in cash, so that's 950 altogether. I'm just walking you through this.

Jeanette Kwakye (2:36)

Thank you, I needed that.

SPEAKER_2 (2:37)

They then have to go into care and the property is sold.

Adrian Chiles (2:41)

Yeah.

SPEAKER_2 (2:41)

So assets are then 950k.

Martin Lewis (2:44)

Assets converted into cash, yeah. Yeah, 1000 converted into cash.

SPEAKER_2 (2:46)

Unfortunately, they then die, leaving a total asset value of 750k.

Martin Lewis (2:52)

Yeah.

SPEAKER_2 (2:53)

What is the inheritance tax situation as there is no property asset now? Does the estate get taxed on the 750k, less the 650k relief?

Martin Lewis (3:03)

So that's really interesting, because especially because the mastermind later will be touching on these types of issues, but not exactly that issue.

So look, when we do inheritance tax on the program, I bring in the specialist because it's very complicated. I'm going to give you a general answer. The question here is, if you have sold your property, do you still get the property exemption if that money is passed on to direct descendants?

So remember, you get 325,000 pounds per person inheritance tax allowance, and then 175,000 pounds extra if your main property is passed on to direct descendants. Now, the rules state that if that property was sold after 2015, I believe, then even if it was sold, if it was your main property, you can still leave that money and get the property exemption. The exact amount depends on when it was sold and exactly what the value is. But yes, in principle, the reason that was done is because what they didn't want to do is suddenly stop everybody selling their houses and downsizing when we've got a housing crisis, just because they wanted to keep that inheritance tax allowance. So there is an exemption in the rules that if you've sold that property and you still have the cash from the sale of that property effectively, within your estate, when you pass on, you can still get the relief on the property even if you no longer own the property. Now, the exact dotting the i's and crossing the t's, you will need to go and see a specialist about. But in general principle, I would have thought was it 750 grand?