Mum gives me her house, how to deal with care costs later on
Discussion
ali_kat said:
Would you give up your job, your home and your social life to look after your parents? Move your wife & kids into your parents/your in laws home? Then having given up your home & job; put your life on hold until that house is sold so you can start again?
That's what we did, we were lucky that my brother wasn't working at the time they got sick & could survive on benefits to run his house, until he & his family could move into my parents after Mum died.
I'm not sure why looking after elderly parents should impact on one's social life but, if it did, I know which would take priority. That's what we did, we were lucky that my brother wasn't working at the time they got sick & could survive on benefits to run his house, until he & his family could move into my parents after Mum died.
As things stand my sister and her family live with my parents. It's quite a large house (7 bed) so plenty of room for all of them, and enough grandkids to keep mum and dad happy. Once my parents pass away I guess they'll leave the house to my sister but tbh that's irrelevant. Surely you'd want your parents to have the best living conditions in later life and sod the personal cost!
Countdown said:
I'm not sure why looking after elderly parents should impact on one's social life but, if it did, I know which would take priority.
As things stand my sister and her family live with my parents. It's quite a large house (7 bed) so plenty of room for all of them, and enough grandkids to keep mum and dad happy. Once my parents pass away I guess they'll leave the house to my sister but tbh that's irrelevant. Surely you'd want your parents to have the best living conditions in later life and sod the personal cost
Really? You're very lucky then; but as this won't affect you; I'm not sure how can can be so condescendingAs things stand my sister and her family live with my parents. It's quite a large house (7 bed) so plenty of room for all of them, and enough grandkids to keep mum and dad happy. Once my parents pass away I guess they'll leave the house to my sister but tbh that's irrelevant. Surely you'd want your parents to have the best living conditions in later life and sod the personal cost
Cancer, Dementia, Alzheimers, Parkinsons etc all need carers 24/7 - Try doing that and having a social life; any kind of life!
Countdown said:
Radical suggestion - how about the kids caring for their own parents? Perhaps using the free money they're getting to make their parents' last few years a bit more comfortable?
I looked after a parent for 7 long years from the beginning of dementia to the end. I did it A to Z and it's a b
d. My job and marriage went up the swanny in that period although not wholly because of. The term 'free money' isn't a good term to use I'm afraid. Ozzie Osmond said:
Elderly said:
is it right/moral that if your chronic incapacitating illness is is diagnosed as Dementia, as opposed to other chronic illnesses that would entitle you to NHS care, - you're on your own?
In how many countries of the world are old age and related conditions eligible for a free ticket to indefinite stay in hospital?The state safety-net is a safety-net. It's not a route to "I've spent all my money having a good time/given it away to my kids so now the rest of you have got to look after me....".
IMO over the coming decades this issue will be increasingly under the spotlight.
Yet those on welfare benefits use the state as a free ticket to doing nothing, then get the OAP care and indeed dementia care for free if they are unlucky enough to get it.
Suggest we fix that and then use the newly available money for free care for the old.
Eric Mc said:
If a property is "gifted" by a parent to an offspring but the parent reserves the right to live in the property, that is called a gift with reservation of title and will not be an effective gift in law.
Also, HMRC may insist that the new "owner" of the property pay Income Tax on the deemed market value of rent they would be getting on the property if let on the open market.
It is worth pointing out with regard to this that if the 'deemed rent' is less than 5k/year there is no charge.Also, HMRC may insist that the new "owner" of the property pay Income Tax on the deemed market value of rent they would be getting on the property if let on the open market.
Not much use to all you southerners out there i suppose, as thats only about £420/month!
What is a bit galling though is that if the deemed rent is say, £600/month (7.2k/year) you pay tax on the full 7.2k, rather than just 2.2k, the amount over the 5k allowed. So its not much good even for the northerners either actually!
Du1point8 said:
Strange that this is a state safety net and not supposed to be used as free ticket...
Yet those on welfare benefits use the state as a free ticket to doing nothing, then get the OAP care and indeed dementia care for free if they are unlucky enough to get it.
Suggest we fix that and then use the newly available money for free care for the old.
Very difficult to fix as where's the newly available money coming from? Better if care homes are just free for all like in Scotland then it's fair all round. Yet those on welfare benefits use the state as a free ticket to doing nothing, then get the OAP care and indeed dementia care for free if they are unlucky enough to get it.
Suggest we fix that and then use the newly available money for free care for the old.
V6Pushfit said:
Du1point8 said:
Strange that this is a state safety net and not supposed to be used as free ticket...
Yet those on welfare benefits use the state as a free ticket to doing nothing, then get the OAP care and indeed dementia care for free if they are unlucky enough to get it.
Suggest we fix that and then use the newly available money for free care for the old.
Very difficult to fix as where's the newly available money coming from? Better if care homes are just free for all like in Scotland then it's fair all round. Yet those on welfare benefits use the state as a free ticket to doing nothing, then get the OAP care and indeed dementia care for free if they are unlucky enough to get it.
Suggest we fix that and then use the newly available money for free care for the old.
Too many people think they deserve it on a plate and that is wrong... I get pissed off with governments constantly giving to certain people as they don't have a laptop/iPad/iPhone.... no no no!! They are luxury items, go buy them if you want them... Yet my parents are hard workers and savers, yet they get penalised for doing so, if they had nothing they get rewarded.
Use the money saved from not paying for votes, etc for OAP welfare, it makes sense.
Du1point8 said:
By making it really really horrible to live off the state as a scrounger or the benefits generation...
Too many people think they deserve it on a plate and that is wrong... I get pissed off with governments constantly giving to certain people as they don't have a laptop/iPad/iPhone.... no no no!! They are luxury items, go buy them if you want them... Yet my parents are hard workers and savers, yet they get penalised for doing so, if they had nothing they get rewarded.
Use the money saved from not paying for votes, etc for OAP welfare, it makes sense.
I've met many people on benefits throughout my life and i agree that most weren't able to budget very well but on the whole they all spent on luxury items for their kids. A life on benefits isnt all roses and although it may have been a personal choice at the start its a pretty crappy existence with a crappy care home to look forward too in later life. Lets be honest if one of your children doesn't break the cycle you wont have anyone to look after you.Too many people think they deserve it on a plate and that is wrong... I get pissed off with governments constantly giving to certain people as they don't have a laptop/iPad/iPhone.... no no no!! They are luxury items, go buy them if you want them... Yet my parents are hard workers and savers, yet they get penalised for doing so, if they had nothing they get rewarded.
Use the money saved from not paying for votes, etc for OAP welfare, it makes sense.
I suppose you could argue that you have paid into the system all your life however the reality is that if you have chosen to have children you will almost certainly have gotten more back.
I plan to build up a retirement fund to see out my old age and if there's anything left the rest of the family are welcome to it but if its all gone then tough luck im afraid.
Edited by barryrs on Monday 23 May 14:22
Jockman said:
silentbrown said:
Elderly said:
It was money that was gifted not the house.
Actually the sheltered flat was purchased by the sons and their spouses using their own funds before their mother happened to gift money to them.
There's still a strong chance of that being considered a "gift with reservations".Actually the sheltered flat was purchased by the sons and their spouses using their own funds before their mother happened to gift money to them.
If not it's quite clearly a gift with reservations and evasion in terms of care costs.
gifts with reservation or havign to pay market or near market rents to the trust is something which seems to escape the understanding of the green eyed monsters ...
V6Pushfit said:
I would also point out that 99% of elderly parents want the best for their children and to leave a legacy which hasn't been destroyed by care home fees.
So the elderly have the right to leave a legacy and the tax payer have the obligation to pay for their nursing home care? Seems fair. To be clear, if that is the system you want, we are going to have to pay a lot more tax and in particular that will penalise the children who choose to go out of their way to support their parents in their old age.
I think we should be actively encouraging the latter. Offloading social responsibilities to the state is a bad idea. The state should be providing a good quality safety net, but only a safety net.
Edited by ATG on Monday 23 May 14:26
ATG said:
V6Pushfit said:
I would also point out that 99% of elderly parents want the best for their children and to leave a legacy which hasn't been destroyed by care home fees.
So the elderly have the right to leave a legacy and the tax payer have the obligation to pay for their nursing home care? Seems fair. the NHS is already paying 110 gbp / week if your rellie is in a Nursing home on top of all the other things the NHS provides free at the point of use ... ( not to mention their free prescriptions and all the admin the GP surgery, pharmacy and Nursing home do to ensure the mads are ordered delivered and so on - there;s no special fee for that )
also NHS continuing care funding is much misunderstood, it's t pay for care where the only practicable alternative is prolonged admission to an NHS hospital ? do we really want to go back to the county pauper lunatic asylum and the long stay geriatric workhouses ?
This is all getting a bit complicated again.
Social Services are not tax inspectors so all this stuff about level of rents and trusts wont be relevant to most people doing this, unless of course they go to a Solicitor who will be only too happy to draw up some 'one off' document and get wrapped up in legalese and wizard wheezes which aren't needed.
Scotland is able to provide free non means tested care homes for all and isn't crippled, or wasn't last time I was there.
The best way is:
1. Find out what the declaration forms say in the area regarding how many years back the person had to own a property for it to be counted. Some are (were) two, some I think up to five
2. Plan for 1.
Social Services are not tax inspectors so all this stuff about level of rents and trusts wont be relevant to most people doing this, unless of course they go to a Solicitor who will be only too happy to draw up some 'one off' document and get wrapped up in legalese and wizard wheezes which aren't needed.
Scotland is able to provide free non means tested care homes for all and isn't crippled, or wasn't last time I was there.
The best way is:
1. Find out what the declaration forms say in the area regarding how many years back the person had to own a property for it to be counted. Some are (were) two, some I think up to five
2. Plan for 1.
1. You might have to pay CGT if you sold the property in the future, on the rise in price since the transfer.
2. Your Mother might have to pay circa market rent or the HMRC would view it unfavourably.
3. Are the recipients in or could be in a relationship where the partner could divorce and claim the house as part of that person's assets?
4. Councils are getting wise to this and are retrospectively chasing people who have done this for care costs!
5. If your Mother and Father bought the house you may be entitled to joint IHT relief from both parents?
6. There are other vehicles to assist you in this that may be a more sensible solution, source IHT specialists now while your Mother is healthy?
2. Your Mother might have to pay circa market rent or the HMRC would view it unfavourably.
3. Are the recipients in or could be in a relationship where the partner could divorce and claim the house as part of that person's assets?
4. Councils are getting wise to this and are retrospectively chasing people who have done this for care costs!
5. If your Mother and Father bought the house you may be entitled to joint IHT relief from both parents?
6. There are other vehicles to assist you in this that may be a more sensible solution, source IHT specialists now while your Mother is healthy?
Mark300zx said:
1. You might have to pay CGT if you sold the property in the future, on the rise in price since the transfer.
2. Your Mother might have to pay circa market rent or the HMRC would view it unfavourably.
3. Are the recipients in or could be in a relationship where the partner could divorce and claim the house as part of that person's assets?
4. Councils are getting wise to this and are retrospectively chasing people who have done this for care costs!
5. If your Mother and Father bought the house you may be entitled to joint IHT relief from both parents?
6. There are other vehicles to assist you in this that may be a more sensible solution, source IHT specialists now while your Mother is healthy?
Quoted in case I ever need a blueprint on how not to address any issues raised by the OP.2. Your Mother might have to pay circa market rent or the HMRC would view it unfavourably.
3. Are the recipients in or could be in a relationship where the partner could divorce and claim the house as part of that person's assets?
4. Councils are getting wise to this and are retrospectively chasing people who have done this for care costs!
5. If your Mother and Father bought the house you may be entitled to joint IHT relief from both parents?
6. There are other vehicles to assist you in this that may be a more sensible solution, source IHT specialists now while your Mother is healthy?
walm said:
Mark300zx said:
1. You might have to pay CGT if you sold the property in the future, on the rise in price since the transfer.
2. Your Mother might have to pay circa market rent or the HMRC would view it unfavourably.
3. Are the recipients in or could be in a relationship where the partner could divorce and claim the house as part of that person's assets?
4. Councils are getting wise to this and are retrospectively chasing people who have done this for care costs!
5. If your Mother and Father bought the house you may be entitled to joint IHT relief from both parents?
6. There are other vehicles to assist you in this that may be a more sensible solution, source IHT specialists now while your Mother is healthy?
Quoted in case I ever need a blueprint on how not to address any issues raised by the OP.2. Your Mother might have to pay circa market rent or the HMRC would view it unfavourably.
3. Are the recipients in or could be in a relationship where the partner could divorce and claim the house as part of that person's assets?
4. Councils are getting wise to this and are retrospectively chasing people who have done this for care costs!
5. If your Mother and Father bought the house you may be entitled to joint IHT relief from both parents?
6. There are other vehicles to assist you in this that may be a more sensible solution, source IHT specialists now while your Mother is healthy?
V6Pushfit said:
Yes, if you take out the obvious 4, risk assess 3, the vagueness of 2, and the worst case scenario for 1 is likely to be less than a few months care home fees and happens to all property where its not the sole residence. So that leaves 5.
5&6 are out because as the OP stated, the value of the property puts the whole estate below the IHT threshold.4 merely sums up the whole point of the OP's question!
1,2 and 3 are true for anyone sharing a second property and renting to a relative, not anything to do with care costs and in any case have been addressed at length in the thread.
walm said:
5&6 are out because as the OP stated, the value of the property puts the whole estate below the IHT threshold.
4 merely sums up the whole point of the OP's question!
1,2 and 3 are true for anyone sharing a second property and renting to a relative, not anything to do with care costs and in any case have been addressed at length in the thread.
Yes my common sense value judgment says why is CGT tax raised as an issue when its being compared to £50k++ a year ongoing for years in care fees?4 merely sums up the whole point of the OP's question!
1,2 and 3 are true for anyone sharing a second property and renting to a relative, not anything to do with care costs and in any case have been addressed at length in the thread.
Oh well. This has all got detailed silly again so ahm oot noo
Eric Mc said:
I'm sure v6pushfit thinks you are making things complicated for no reason.
Of course, everything you say is absolutely correct.
That's true but I still don't see anyone with a definitive answer to "can mum give me the house and avoid potential care costs?"Of course, everything you say is absolutely correct.
V6 seems to think there will be a definitive time limit by each council. Which seems VERY unlikely to me.
Others agree with the Age Concern advice which is that if you KNOW you will have care costs and dispose of the house, that's not on.
But what isn't clear is that in this case, where the care costs are simply POTENTIAL, and by no means a guaranteed cost, can the mum give the house away in good faith?
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