Capital Gains Tax | Paul Daniels Magic World

Capital Gains Tax

I might have goofed.   I might not have thought ahead.   Oh the pain the pain.

Let me explain.   A long time ago I bought a bungalow in which to let my Mother live and to take away the need for her to worry about all the niggly things that put stress onto pensioners.    It also took away the need for the State to ‘provide’ for her.    We didn’t claim for anything year after year after year.

We also should have kept, perhaps, a long long list of all the costs of keeping the bungalow itself in good health; the maintenance, the repairs, the decorating, Council taxes.. ALL the expenses… you know what I mean.

Why?   Well, I know that the time has now come to sell the bungalow.  In the coming weeks now that Mam has passed away, it must be emptied and sold.

In any business you are allowed to claim expenses against tax.   Apparently not in the case of Capital Gains Tax.   At a first glance calculation, having saved the Government a small fortune by looking after my Mother at my own expense, which by the way, I have never regretted or minded in any way, I will be handing over about £136,000 in tax.    That feels SO wrong.

Which brings me to another thought.    I sometimes wonder, when people say their house has gone up an enormous amount in value, whether they have kept full and proper accounts of what it has cost them over the years to live there.    Homes are a constant expense, in local taxes and all the repairs, painting, TV licences, phone bills, furniture, and so on and it would be interesting to find out if anyone out there has ever really recorded the total.   Surely some accountant will have done it, or it might be a case of ‘Plumbers’ taps drip’ and nobody knows.

I once did it for a year and decided it was cheaper to live in a hotel, which I did for a year.   It was.

£136,000… grrrrrrrrrrrrrrr

8 comments to Capital Gains Tax

  • Coboman
    March 15, 2014 at 2:49 pm | Reply

    Firstly Paul, it is to your credit that you looked after your mum.

    I am not of the school of thought which tends to put you down. I shared your experience of coming from a working class background, working your socks off, and trying to be the best and ending up seeing through the illusion of socialism which promised everyone everything, but kept the disadvantaged in the way they expect.

    Perhaps Stalin was the greatest illusionist ever.

    Anyway, bear with me. I am far from hostile to you.

    In terms of your argument about losing “£136k”, the maths do not work out.

    I am just trying to give you the facts and the reality, rather than what your paid advisors want you to hear.

    You say that you have saved the state loads of money by making adaptations to your mum’s bungalow, so she did not go into a care home.

    What you have not been advised is that if you could establish that your mum could live in the same house with adaptations, then the rules say that the state would not pay for her home care fees.

    If you look into it, the State only pays for home care fees for the elderly where there is a clinical need for 24-hour supervision.

    Everyone else is charged at least £30,000 a year, a cost which falls on the estate of the person when they die.

    So it could be argued that if you did not make the adjustments to ensure that your mother could stay in the same home, then it might have cost her estate £300,000 upon her death. Plus possible death duties.

    By the way, even though I live in South West London, I spent my first 45 years being brought up in Liverpool.

    It would be inappropriate if I did not try to crack a joke at this time, which is one of my own.

    Q: “Why do old people like to live in bungalows?

    A: ” Because it stops them from asking the question of ‘why have i gone upstairs?”

    In your argument about the cost of the adaptations you made in the bungalow to make your mum’s life easier, this is a double-edged sword.

    Turn it on its head. You were probably eligible for the local council to pay for all the adaptions you made, Because you had the financial clout, by your own efforts, you could sort this out without the form-filling procedures which would have driven you mad.

    So look at it another way. What about the families who have a parent who need adaptations, where the council paid for it, but when they died, the children inherit the property.

    Should the local council have a claim against that inheritance to recoup the cost of the adaptations they made in a private property?

    I have my own examples where I used my own money to get a private diagnosis, simply to save the NHS money, and was then penalised because I did not go through the NHS. So I can understand where you are coming from.

    HOW YOU CAN CHANGE THIS COUNTRY

    I have two children with Asperger’s, and i have used magic a trickery to engage them.

    It strikes me that your approach and knowledge should be shared with kids with behavioural or learning difficulties.

    Most of these kids are allowed to drift away and stay disengaged because they have no magic in their lives.

    I am absolutely convinced that it you combined your basic magic and illusions, combined with humour, you would introduce such children to an acceptance of an alternative way of thinking, in such a way that they can calibrate their own alternative thought process.

    I am being a bit controversial here, but from the point of view of the children who do not “fit in”, the State creates an illusion that they are being understood and being catered for.

    It is counter-intuitive, but someone like yourself who can create a curriculum where such children can create their own illusion or magic, makes them feel validated.

    I did it with my own kids, where they were struggling to understand the emotional illusions and tricks that the neurotypicals use to get on with each other.

    I showed them some basic card tricks and explained to them that when it came to social interaction, those who had the natural ability to respond in the right way, were perhaps falling for the three-card trick.

    Amazingly, when i showed them basic card tricks (combined with humour), it really helped them to understand their so-called social difficulties.

    For me, I think that magic and illusion should be on the curriculum of people with learning disabilities. Although I recognise you should not compromise the secrets of the “Magic Circle”.

    You have a fantastic gift, which I think is potentially vital for the world of education.

    With your profile, there are many opportunities for you to do dry runs to test this hypothesis, And perhaps a TV thing afterwards.

    Your skill and experience and knowledge crosses science, maths, psychology use of language, self improvement and success.

    Perhaps it is a modern-day form of alchemy.

    Before you go into that stage box where God waves his magic wand and you disappear for ever, in that black-curtained box on the stage, I feel that the best days may be ahead of you.

    Just one magic question for you: “What happens if you divide the number one by seven, and then add on the product seven times?

    If you want me to extrapolate this idea, and give you lots of original jokes as you move forward, then let me know.

    With appreciation for your mind,

    PETER

    • Paul
      March 17, 2014 at 9:46 am | Reply

      Hi Peter

      I wish I had time to answer your email in full instead of in haste. I did laugh at your assumption that my Mother’s ‘estate’ would have had £300,000… She would have loved that.

      Lovely to hear that your magic is helping out with the kids. Unfortunately for your suggestion I simply cannot take on any more charities. A few years ago there were so many requests that I had to pick out a few and that’s what I still support and work for.

      Best wishes

      PD

  • Dawn Sherratt
    May 21, 2014 at 10:43 am | Reply

    Coboman, St. Thomas’ Hospital, London has used Magic to teach co-ordination skills. My Son Luke Lamont, a Professional Magician has even learned Makaton to help profoundly disabled people enjoy Magic. It can be done! Good Luck with your family.

  • a christy
    May 21, 2014 at 9:32 pm | Reply

    UlWell Paul I think it’s totally imoral and disgusts me how the government can tax you so much after the amount of money you have saved them! If it was me personally I wouldn’t give them a penny ther all a bunch of criminals and that is a true story!!

  • Greg
    September 12, 2014 at 10:24 am | Reply

    If you’re paying £136,000 in Capital Gains Tax (at a rate of 28%), presumably that’s because you’ve made a Capital Gain of c. £486,000 (i.e. the bungalow’s value has increased by that amount since you’ve owned it). That leaves £350,000 in your pocket. Have you really spent anything close to £350,000 on decorating, maintenance etc. over the years you’ve owned the bungalow? And even if you have spent the full £350,000 – isn’t it pretty good going to get all that money back, bringing the net cost of housing your mum for all those years down to zero?

    I’m not sure what you mean when you say didn’t claim for ‘anything’ year after year. Presumably your mum received the same benefits as any other pensioner living in a privately owned home – a State Pension, Winter Fuel Allowance, bus pass, TV licence, etc. Presumably she relied to a lesser or greater extent on various public services including the NHS (which, unless she had exceptionally comprehensive private health cover, probably spent many tens of thousands of pounds treating her during her old age). So when you talk about the state not having to provide for her, you’re really only talking about the Housing Benefit it would have had to pay if she’d been renting and on a low income. It’s almost beyond doubt that the cost to the state of supporting your mother during her retirement far exceeded the £136,000 in tax you’re being asked to pay.

    The fact is that you’ve accumulated about half a million pounds in wealth just by owning this bungalow – about what an average person earns by going out to work every day for twenty years. It’s to your credit that you’ve (effectively) spent a good chunk of that money giving your mum a nice retirement, but please don’t resent giving another chunk – comparable to what someone else would pay while going out and earning that same amount of money over many years – to fund all the things less fortunate pensioners rely on so heavily.

    • Paul
      September 22, 2014 at 8:24 am | Reply

      As a ‘retired’ accountant/auditor I know that your maths/reasoning is VERY flawed and I wish I had time to go into the details. Suffice to say that you really haven’t enough knowledge of the full picture. Thank you for your observations.

  • stephen
    October 6, 2014 at 7:36 pm | Reply

    Respect to you Mr Daniels for speaking your mind in a country where these days so many public figures seem to only dare say what they think will make them popular. Best wishes and thanks for entertaining us over the years

  • John Waller
    November 16, 2014 at 9:14 pm | Reply

    Hi Paul,

    If the bungalow was under your name, surly you don’t have to pay any Capital Gains Tax as its your bungalow? Sorry to hear about your lost.

    In 2011 we had to sell our home because of Capital Gains Tax after my Nan passed away. We used to live on farm which had two semi houses. The problem was the farm was under my Nan’s and my mum’s name. So my Grandad had nothing to do with it. It all got complicated and we had to move as the tax was just over half a million pounds and we were all in dept. It really was the worse time of my life.

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