Discussion
Can any body help here?
My parents, both in their 80's own their house valued at about £350,000 and some cash savings in the bank. I live abroad as an expatriate in Asia and am non resident for UK tax purposes. My sister is in the UK and subject to UK taxation.
My mother is failing and will quite soon have to be put full time in a council run nursing home leaving my father alone in the house.
I have read about some local councils making the spouse pay for the full time nursing care which ends up with their house having to be sold once their cash savings are exhausted. Once all savings and assets are exhausted the council then foot the bill.
My question is: what if my parents sold their house to me for a nominal sum and gave my sister power of attorney so as to give our parents some protection if I suddenly go mad. Since I am not subject to UK taxation or UK law my parents would be able to declare that they had no assets and hence fall on the state to provide them with care as and when it is required.
I understand that there could be some Death Duties taxation should they both die within the a certain time period. However, the concern is not to avoid Death Duties only to prevent the local councils depriving them and their beneficiaries of their hard earnt assets.
Any other ways foreword?
My parents, both in their 80's own their house valued at about £350,000 and some cash savings in the bank. I live abroad as an expatriate in Asia and am non resident for UK tax purposes. My sister is in the UK and subject to UK taxation.
My mother is failing and will quite soon have to be put full time in a council run nursing home leaving my father alone in the house.
I have read about some local councils making the spouse pay for the full time nursing care which ends up with their house having to be sold once their cash savings are exhausted. Once all savings and assets are exhausted the council then foot the bill.
My question is: what if my parents sold their house to me for a nominal sum and gave my sister power of attorney so as to give our parents some protection if I suddenly go mad. Since I am not subject to UK taxation or UK law my parents would be able to declare that they had no assets and hence fall on the state to provide them with care as and when it is required.
I understand that there could be some Death Duties taxation should they both die within the a certain time period. However, the concern is not to avoid Death Duties only to prevent the local councils depriving them and their beneficiaries of their hard earnt assets.
Any other ways foreword?
I'm doubtful your father could be forced to sell the house while he's still in it. We're in a similar position except that only one relative is still alive. Even then we've been told by her solicitor that if she goes into care the house doesn't have to be sold until she dies, but the council do register a charge against it and so will recover their costs (but they can't take the last £20K of her estate).
Maybe there's some useful infor here(and in the linked threads):
http://forums.moneysavingexpert.com/s
Maybe there's some useful infor here(and in the linked threads):
http://forums.moneysavingexpert.com/s
yep true, I am no accountant but my understanding of it is if the house had been gifted to you, and your parents do not die within 7 years of that gift you save the inheritence tax, and I assume the same would apply to paying for council care.
Your parents could sell the house to you but it would have to be at the market price. Not really helping as they would have £350,000 in the bank. Personally I think it is an absoulute disgrace that people like your parents, who I assume have worked bloody hard all their life and paid tax, should be reduced financially to zero.
Your parents could sell the house to you but it would have to be at the market price. Not really helping as they would have £350,000 in the bank. Personally I think it is an absoulute disgrace that people like your parents, who I assume have worked bloody hard all their life and paid tax, should be reduced financially to zero.
jamesuk28 said:
yep true, I am no accountant but my understanding of it is if the house had been gifted to you, and your parents do not die within 7 years of that gift you save the inheritence tax, and I assume the same would apply to paying for council care.
It's a mega complicated area - fraught with pitfalls and constantly changing legislation. One key thing is that if a house is given to children and parents continue to live in it then they have to pay a market rent (taxable, of course) to the children. Or the parents become liable for Pre-Owned Assets Tax.
jamesuk28 said:
Personally I think it is an absoulute disgrace that people like your parents, who I assume have worked bloody hard all their life and paid tax, should be reduced financially to zero.
Well, I don't know. Is it reasonable for other taxpayers to fund care of elderly people just so that they can leave money to their kids?
deva link said:
jamesuk28 said:
yep true, I am no accountant but my understanding of it is if the house had been gifted to you, and your parents do not die within 7 years of that gift you save the inheritence tax, and I assume the same would apply to paying for council care.
It's a mega complicated area - fraught with pitfalls and constantly changing legislation. One key thing is that if a house is given to children and parents continue to live in it then they have to pay a market rent (taxable, of course) to the children. Or the parents become liable for Pre-Owned Assets Tax.
jamesuk28 said:
Personally I think it is an absoulute disgrace that people like your parents, who I assume have worked bloody hard all their life and paid tax, should be reduced financially to zero.
Well, I don't know. Is it reasonable for other taxpayers to fund care of elderly people just so that they can leave money to their kids?
Yes, it's completely fair. It's not other people who fund their care, the parents have paid tax into the system throughout their working lives to pay for their welfare.
Personally I'm gonna spunk my money up the wall... What's the point in saving hard when HMG will take it anyway.
BliarOut said:
Personally I'm gonna spunk my money up the wall... What's the point in saving hard when HMG will take it anyway.
Ideally (assuming you start on zero) you would accumulate assets while working and then run them down while in retirement. The issue I'm wrestling with is how to ensure my assets hit zero on the same day as I die.
Thanks to all replying
jamesuk28 wrote:
>Your parents could sell the house to you but it would have to be at >the market price. Not really helping as they would have £350,000 in >the bank.
Why should they be forced to sell at market rates?
If, as they do, own the property surely they can sell for what they like. I understand the UK government solda well known car manufacturing company in the UK £1 to a private consortium. Likewise why would they have to pay a market rate for rental? If I owned an expensive car what is to stop me giving it away.What makes a house so special.
Perhaps I am being a little simplistic here.
What has happened in the UK to take away a persons freedom to do what he wants with his hard won assets.
jim hobbs said:
Can any body help here?
My parents, both in their 80's own their house valued at about £350,000 and some cash savings in the bank. I live abroad as an expatriate in Asia and am non resident for UK tax purposes. My sister is in the UK and subject to UK taxation.
My mother is failing and will quite soon have to be put full time in a council run nursing home leaving my father alone in the house.
I have read about some local councils making the spouse pay for the full time nursing care which ends up with their house having to be sold once their cash savings are exhausted. Once all savings and assets are exhausted the council then foot the bill.
My question is: what if my parents sold their house to me for a nominal sum and gave my sister power of attorney so as to give our parents some protection if I suddenly go mad. Since I am not subject to UK taxation or UK law my parents would be able to declare that they had no assets and hence fall on the state to provide them with care as and when it is required.
I understand that there could be some Death Duties taxation should they both die within the a certain time period. However, the concern is not to avoid Death Duties only to prevent the local councils depriving them and their beneficiaries of their hard earnt assets.
Any other ways foreword?
My parents, both in their 80's own their house valued at about £350,000 and some cash savings in the bank. I live abroad as an expatriate in Asia and am non resident for UK tax purposes. My sister is in the UK and subject to UK taxation.
My mother is failing and will quite soon have to be put full time in a council run nursing home leaving my father alone in the house.
I have read about some local councils making the spouse pay for the full time nursing care which ends up with their house having to be sold once their cash savings are exhausted. Once all savings and assets are exhausted the council then foot the bill.
My question is: what if my parents sold their house to me for a nominal sum and gave my sister power of attorney so as to give our parents some protection if I suddenly go mad. Since I am not subject to UK taxation or UK law my parents would be able to declare that they had no assets and hence fall on the state to provide them with care as and when it is required.
I understand that there could be some Death Duties taxation should they both die within the a certain time period. However, the concern is not to avoid Death Duties only to prevent the local councils depriving them and their beneficiaries of their hard earnt assets.
Any other ways foreword?
If the finacial trend is national, that'll be circa 18K annum
As the above poster mentioned in terms of last few years
some care needed its an absolute disgrace to zero their nest egg
in such a way.
I (now armed with this info first hand) fully intend to make over
the familly home to offspring well within timespan,
as I fully NOT intend to benefit the local authority,
instead would rather see it squandered first hand by sprog
rich 36 said:
I (now armed with this info first hand) fully intend to make over
the familly home to offspring well within timespan,
You should *never* rely on advice that you read on an Internet forum - take proper advice. This whole area, which is largely about inheritence tax planning, needs very careful planning and an advisor that can keep on top of changing legislation.
If you make your home over to your children there could be unwelcome consequences if you fall out, they get divorced or are declared bankrupt. You might think these things seem unlikely, but they do happen.
Of course Deva,
I have some unwelcome first hand experience
on the finacial aspects of care/nursing homes
and in the event I need One in due course,
Hope they see lttle recompense at my personal expense
they've had their chance during my working carreer
to extort my hard-earned,
I vehemently disagree with further contributions.
But yeah thanks I understand the value of info gleaned here
richard
I have some unwelcome first hand experience
on the finacial aspects of care/nursing homes
and in the event I need One in due course,
Hope they see lttle recompense at my personal expense
they've had their chance during my working carreer
to extort my hard-earned,
I vehemently disagree with further contributions.
But yeah thanks I understand the value of info gleaned here
richard
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