Over-40s will pay more tax or be compelled to insure for later life, in new plans from the UK government in a bid to solve the later life care crisis.
Proposals for over-40s to begin paying more tax are being mulled over by the Government and the Department of Health and Social Care, according to reports.
Modelled after Japan and Germany’s later life funding systems, the proposals suggest over-40s should be either taxed via payroll or take out insurance to pay for later life care – and protecting valuable assets like family homes being used to pay for care.
Nicola Hawkins, a tax, trusts and estates solicitor at UK law firm Irwin Mitchell, said: “It’s a relief that after years of ignoring the later life crisis the Government is now taking active steps to ensure the future of our elderly and vulnerable. However, there are serious implications that need to be considered.
“There will inevitably be pressure points that the Government has to take into account with a system like this. Those with lower incomes may not be able to afford the increased outgoings, plus those approaching retirement age will be short-changed.
“That being said, if the kinks can be worked out ahead of any system being put in place then we could see everyone...