Advice on how to avoid losing assets to Care home fees and Inheritance Tax.

[citizenB]

I normally manage to avoid the store exit reps, those who are selling double glazing, conservatories etc, However, yesterday whilst I was at the Range, I got caught by a lady working for a law firm offering an hour's free advice on how to avoid assets being gobbled up by Care Home Fees and Inheritance Tax.

 

 

I have already written a will, as has hubby, with the help of our own solicitor - we are tenants in common on a mortgage free property and have both nominated our son to inherit our share of the property and assets in the event one of us dies before the other.

 

 

The chances of our having property value and assets that would create a need to pay inheritance tax is in the realms of fantasy (unless we come up on the premium bonds or win the lottery).

 

 

The lady who was making appointments for her firm seemed to bat back my responses to her questions making like despite the plans already in place, that the authorities would still be able to place a charge on the home in the event one of us requires admission to a care home - despite the other still living in the home ?

 

 

I have had a read of the following article in the Guardian and used their calculator using a hypothetical situation. According to the result of the Q/A - then if only one of us required admission to a care home and the other left still living in the property then the person who was admitted would not have their share of the property included in any calculation for fees.. this was not what we were told at the Range ?

 

 

https://www.theguardian.com/money/2014/aug/28/tenancy-common-care-home-fee-solution

 

 

I have also looked at Age UK's website http://www.ageuk.org.uk/

 

 

I believe that I might have been misled by the above person in order to secure an appointment. The flyer I have been given indicates that there will one hour's free legal advice worth £200.00 VAT. I am assuming that if we were to go ahead with the appointment then any time outside of that hour will be charged at that rate.

 

 

I will not be taking the Firm up on their offer, instead, I will contact my own solicitor on Monday to ensure that we have covered all bases, but would still be interested in hearing if anyone else has been caught out like this ?

[Mr.P]

The lady who was making appointments for her firm seemed to bat back my responses to her questions making like despite the plans already in place, that the authorities would still be able to place a charge on the home in the event one of us requires admission to a care home - despite the other still living in the home ?

 

[...] if only one of us required admission to a care home and the other left still living in the property then the person who was admitted would not have their share of the property included in any calculation for fees.. this was not what we were told at the Range ?

 

As I understand the current rules, you are correct. The value of the property is disregarded whilst the partner is still alive and occupying the home. However, with budgets being squeezed and councils looking at ways to supplement their income, the rules may change.

 

One of the current wheezes for protecting the family home is to place it into a discretionary trust along with other assets. The fees from setting up a trust can be quite substantial as can any annual fees. Councils and central government have cottoned on to these schemes and it looks like there may be legislation in the pipeline to render them void. See: http://www.telegraph.co.uk/finance/personalfinance/insurance/longtermcare/10117822/Warning-over-care-home-trust-schemes-that-promise-to-protect-your-property.html

[Ford]

yep, re in trust, to the son/grandchildren etc. a poss option.

trusts generally cant be touched until realised. but, as mr P says the vultures want to void them in certain circs.

[Ford]

ps

you are tenants in common. dont know how that wld affect things. but, maybe being joint wld help (as the other joint wld be entitled to the whole. whereas as t in c, your share cld be liable)? not sure, maybe something your sol can also advise on.

[citizenB]

Thanks for the input guys