I have been asked a question.
A lady of advanced years lives in her own house. She does not want to have to sell her house to fund residential care, should that become necessary, since she wants to leave something for her children.
Is there a legitimate way of ensuring this?
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>> Is there a legitimate way of ensuring this?
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complex issue. You may find some help here
www.taxationweb.co.uk/forum/trusts-and-estates-f12.html
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Yes complex indeed... another area we were being nudged close to a couple of years back.
The Gov statement on this serves as a warning...
Sometimes people deliberately transfer ownership of their assets to someone else in order to reduce what they pay in care home fees. If the local council believes this has happened they may assess you differently than in the normal assessment procedure:
•if assets were transferred within the six months before you moved into care, the council can recover the cost of your stay from whoever received the gift
•if the transfer happened more than six months before you moved into care, they can assess you as if you still own the assets
There is no time limit as to how far back the council can go to find out if you have given away assets to avoid care costs.
There are specialists who deal in this and will charge you money to set up arrangements that apparently protect the home..... but they may not meet the letter of the law and you could still end of with the home fees being due.
Last edited by: Fenlander on Thu 17 Feb 11 at 10:38
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Possibly but you need to start the avoidance processes some years before the event.
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If the house had been transferred into a trust for IHT purposes 25 years ago then it might be a bit hard for the LA to claim it had been done in order to avoid care home fees. But now with time drawing on the possibilities look pretty slim.
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I know of one or two farming families who transfer assets away from the older member to sons and daughters to reduce tax on the estate.
The earlier you start the better, and there used to be something about you could only give away so much every seven years.
The risk for the older person is that he successfully skints himself by the time he's 70, and then there's a family fall out.
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>> I know of one or two farming families who transfer assets away from the older
>> member to sons and daughters to reduce tax on the estate.
Often, these days, the farms are physically split within heirs, and then operate as a co-op.
You need to start early to reduce the grab on your assets. Shared ownership, tenants in common, trusts etc.
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>>Is there a legitimate way of ensuring this?
Probably not.
I had a colleague who researched this way back in the 90's, when he and his elderly mother were thinking of transferring her house into his name. However, the advice they received at the time was extremely negative, so they took the matter no further.
I wouldn't think much will have changed since then.
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Of course there's an aspect not being discussed and one we had to form an opinion on when we were close to these issues.
Is it right that relatives throw their hands up in horror at losing some of their inheritance to get *the best possible care* for the elderly person. It didn't take us long to form the opinion if the elderly person used their cash for their own care then fair enough.
At the end of the day it is very sad to face losing a parent (which it is so often when folks have to consider these matters) and what is left afterwards is a secondary issue.
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>> >>Is there a legitimate way of ensuring this?
>>
>> Probably not.
>>
>> I had a colleague who researched this way back in the 90's, when he and
>> his elderly mother were thinking of transferring her house into his name. However, the advice
>> they received at the time was extremely negative, so they took the matter no further.
>>
>> I wouldn't think much will have changed since then.
As it was his primary residence, there is much that could have been done.
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>>As it was his primary residence,
It wasn't, though.
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Main issue
1) Is the owner ill? Dementia, long term cancer care - NHS are responsible and house cannot be touched
2) owner is elderly & frail but otherwise OK but needs to go to a home - Council will pounce unless a relative lives in the house and has done for many years - husband, daughter, son qualify.
Trouble is there are an infinite number of grey areas and you need PROFESSIONAL HELP on the matter - your local solicitor is probably not up to it but spending £X,000 on advice might stop the sale of a house worth hundreds of thousands.
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>> Main issue
>>
>> 1) Is the owner ill? Dementia, long term cancer care - NHS are responsible and
>> house cannot be touched
>>
Indeed. If you want them in a nasty grimy pee stained hell hole.
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>> >>
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>> Indeed. If you want them in a nasty grimy pee stained hell hole.
>>
A distant relation was paying nigh on £800 / week and you could smell the fumes parking in front of open windows. Buzzer pressing gave a response in 10 minutes if she was lucky.
Given the choice I'd opt for the Red Bus or Fast Train solution
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...A distant relation was paying nigh on £800 / week and you could smell the fumes parking in front of open windows...
I could tell a similar story.
Paying vast amounts per week does not guarantee a good standard of care.
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No and the arrogance of some care home managers when confronted with shortcomings has to be experienced to be believed.
However there are excellent ones... like the place in our area that looks like a rock star's mansion and is restored to the highest of standards as you would a private house.... where all the staff are local and helpful etc etc.
The worse was a crumbling pile of a pee stinking place staffed mostly by folks who struggled with English* run by a very large organisation that should know better.
*Absolutely not a racist thing but if your 80-90yr old parent has gone into a home in a confused state it would at least be good if the staff could understand them and vice-versa.
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>> The worse was a crumbling pile of a pee stinking place staffed mostly by folks
>> who struggled with English* run by a very large organisation that should know better.
>>
These foreign workers are in demand because, broadly speaking, the indigenous Brits don't want to do the work. New immigration rules mean that in future new non-EU migrants will need to meet English Language proficiency standards:
Overseas senior carers - an exception to the rule…but not for long
Because of the skills shortages in certain parts of the UK labour market, employers are not required to comply with some of the above criteria, including the increased salary thresholds. This makes it easier and less expensive to source workers from outside the EU.
Skilled senior care workers are considered in shortage, and so employers in the care sector wishing to recruit for these positions can rely on more lenient criteria. They can also avoid the time and costs of advertising vacancies within the UK before employing an overseas carer, provided the following conditions can be satisfied:
* the job includes supervisory responsibilities
* the carer is paid £7.80 per hour
* the carer has passed an English language test and has at least a NVQ level 2 or equivalent qualification in care
* the carer has two or more years relevant experience (excluding any experience gained during a work placement as part of a qualification).
The requirements are slightly different in Wales and Scotland.
The rules do not apply to current immigrants:
The immigration rules currently favour overseas carers already in the UK on work permits. Unlike work permit holders employed within other industries, carers are not required to sit an English language test, and they do not need to satisfy the criteria relating to personal finances, salary or qualifications, even if they wish to continue working as a senior care worker but in the UK with a different employer.
However, the care home must still have a sponsorship licence in place before the expiry of the individual's work permit, in order to continue employing them, or before it recruits other work permit holders already in the UK.
If a carer has been on a work permit in the UK for five years, they will normally be eligible to apply for permanent residence, allowing them to live and work in the UK free from most of the usual immigration restrictions.
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As posted above Mrs B's mother has alzheimer's.
Relatively few places will take residents with dementia who remain physically fit (and therefore prone to wander). Nontheless we managed to shortlist four or five within 30 minutes of our home.
Two I wouldn't have put a dog in. Another was a rabbit warren of corridors & steep stairs in an historic house. Only one fittted the bill and mercifully it has spaces.
All cost exactly the same.
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>> Main issue
>>
>> 1) Is the owner ill? Dementia, long term cancer care - NHS are responsible and
>> house cannot be touched
I suspect the law is diferent in Scotland. In England moderate dementia is care home territory and not funded as health care. The house goes in the pot.
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Back on topic I’ve never quite understood why ‘the house’ has so much more pull in these cases than ‘the shares’ or ‘the bank accounts’. Try and look at the overall estate.
If trying to preserve the house as a residence it would be sensible, first of all, to find out what exactly the law requires and whether any of its exemptions or savings apply. I’m thinking here of issues where there are dependents or relatives who’ve had a long term caring role and for whom the parental home might be their only roof.
It’s also worth doing an accurate calculation of the living costs in the care home and the size of the gap between that figure and the resident’s income. Make sure all due benefits are in payment; anybody needing residential care is going to be near to meeting the qualification for Attendance Allowance. Those from the middle classes who’ve got their own occupational pension, their spouse’s occupational widows pension and a state retirement pension might actually find the gap is a small one.
And if you’re going to try and transfer the house do it properly and professionally. The Councils know the obvious tricks. If you transfer your house to your offspring are you sure they’re financially secure. In the event of their bankruptcy your roof is going to be at serious risk!!
Last edited by: Bromptonaut on Thu 17 Feb 11 at 13:56
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Worth considering staying at home with 24 hour live in carer, when we did it for MiL costs worked out about the same as care home but much healthier and more settled for MiL. We had to agree when we would stand in so the carers could get a break but overall when she did go we felt we had done the best for her.
Doesn't help with the original question but for the wider care discussion it may be an alternative worth considering for some.
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Try considering this question:
>> A retired couple live in their own house. They do not want to
>> have to sell their house to fund a year spent going round the world , since they
>> want to leave something for her children. Is there a legitimate way of getting the state to pay?
Nobody would answer "yes" to this question, yet somehow illness is regarded as being the state's responsibility. Why?
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>> yet somehow illness is regarded as being the
>> state's responsibility. Why?
The NHS.
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What happened to this proposal:
news.bbc.co.uk/1/hi/8288111.stm
"Tories unveil care home guarantee"
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Because illness is the state's responsibility for those who have not tried to save for anything / those who are, through no fault of their own, unable to pay*.
Holidays etc are not the state's responsibility for anyone. Not the same thing at all or even in any way comparable.
* delete as applicable
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>> Because illness is the state's responsibility for those who have not tried to save for
>> anything / those who are, through no fault of their own, unable to pay*.
>> Holidays etc are not the state's responsibility for anyone. Not the same thing at all
>> or even in any way comparable.
Hang on... you wrote "illness is the state's responsibility for those who are, unable to pay"
That's quite a different individual from somebody who is asset rich like a property owner.
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read my whole post
it depends on whether you think those who can't pay should have saved up so that they could pay and those who can can pay because they have saved etc
I make no comment on my views
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In a compassionate world you have to take people as you find them. So if they've spent all their money, then they need housing.
If they've not spent all their money then I'm afraid we are not wealthy enough to pay for their care.
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A valid point of view, if oversimplified
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Visiting a private care/nursing home over a period of time is an interesting experience. The majority of those there are not in wheelchairs or on drips... and they are often visited by very capable and organised people who look to lead successful lives.
Years ago in the UK, and currently in other cultures, you wouldn't see this.
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Mainly because most families/couples need dual incomes these days and there isn't a capable adult at home to care for an elderly relative in the day time. So, many people choose a care home route. Rather that than have your unattended parent slip, fall and lie dying on the kitchen floor unattended. Perhaps.
If you are implying that modern British people can't be bothered and just want to ditch the elderly, then that's probably unfair in the vast majority of cases.
The country has not gone to hell in a hand cart, the younger generations are not any less caring than those which went before.
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>>>If you are implying that modern British people can't be bothered and just want to ditch the elderly, then that's probably unfair in the vast majority of cases.
No not what I'm saying but my observation is a valid one... and an area where we are not entirely free of involvement.
I'm not so sure so many people need dual incomes... but they do seem to seek them.
Last edited by: Fenlander on Thu 17 Feb 11 at 16:20
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>>I'm not so sure so many people need dual incomes
A lot of modern girls WANT jobs.
And a lot of modern girls with jobs would rather not but cannot afford not.
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>> No not what I'm saying but my observation is a valid one... and an area
>> where we are not entirely free of involvement.
Oh. What are you saying then? Are you just making an anecdotal observation without a point to it? Fair enough if so, but seems an odd thing to do.
>> I'm not so sure so many people need dual incomes... but they do seem to
>> seek them.
Career paths are difficult things to get on and off of, to temporarily (let's face it) care for an elderly parent. People have their own retirements to think about funding, too. Many, many variables in everyone's lives, it's just a bit too easy to curl one's lip at someone you think to be selfish.
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I can't believe anyone wants to "ditch" the elderly. there is a range of options for care as much as there is a range of needs.
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Years ago the proportion of the population surviving long enough to be old & frail was much smaller. Also, with larger families living closer together there was closer overlap between the generations.
And of course old people were out of sight in NHS geriatric hospitals or asylums.
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>> Mainly because most families/couples need dual incomes these days and there isn't a capable adult at home
>> to care for an elderly relative in the day time. So, many people choose a care home route. Rather that than have
>>your unattended parent slip, fall and lie dying on the kitchen floor unattended. Perhaps.
Some of the homes have "day residents" to cater for the scenario above.
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I had a meeting with a financial advisor at the Leeds when I invested MiL's funds from the sale of her house.
Fortunately, interest rates were good at the time and with her pensions and allowances there was more than enough each month to pay the home fees without touching the capital.
I did ask him if the capital could be protected if and when the interest rates fell.
He produced a booklet that gave details of how to create a family trust, which would get round the problem. Perhaps our legal beagles know more about this.
It would have cost about £3K to set up. I didn't bother, as she was well over 90 at the time.
She died while the high interest was still being applied to the fixed bond.
We had her in a Manchester Care owned home which was very good...£374 per week.
It was walking distance and the staff were great. After a year we were told it was closing.
By good fortune, there was a vacancy at a small private home even nearer to us and the same price. Again, very kind staff...no complaints from us. She passed away there with dignity in her sleep in 2009.
Ted
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>> We had her in a Manchester Care owned home which was very good...£374 per week.
Never looked into it, although probably ought to - is that a typical figure? Sounds like a lot, although I guess 7 day care doesn't come cheap.
Last edited by: Focus on Thu 17 Feb 11 at 16:36
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I thought it was cheap, Focus.
Compared to some brochures we got.
A friend worked at a big, new build home. We got the guided tour and the manageress kindly offered £100 a week off a room.
That brought the cost down to about £750 a week....she didn't need a swimming pool, dance floor or bar, so we declined the offer.
Ted
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Residential care because of illness or old age IS the responsibility of the state ever since the NHS was started. To differentiate care due to assets makes a mockery of the whole system.
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>> Residential care because of illness or old age IS the responsibility of the state ever
>> since the NHS was started. To differentiate care due to assets makes a mockery of
>> the whole system.
If you write it thus, then yes. However:
1. The NHS when it started was never envisaged as the world's second largest employer after the Chinese army.
2. We cannot afford the NHS.
3. The retirement age was set at 65 because it was the anticipated average lifetime. The average person didn't have a retirement. Now we live maybe twenty years or more.
One way or another there are huge gaps between what we can afford and what is "expected". Public sector pensions are another - state employees get paid private company salaries (allegedly in order to be competitive) and on top of that they get an index-linked pension.
The system is a mockery of what it was intended to be, I'm afraid.
Sorry for thread drift.
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To reply to 2 posts
£374 a week is a very good price, around us £7-800 is more the norm.
I agree with Zero, however society needs to adapt to increasing numbers of older people and thus increasing numbers of older people needing care.
It needs a wider approach than simply saying, if you have a home it will be sold to provide your care needs.
For a start the limit at which state aid kicks in should be considerably higher.
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>> It needs a wider approach than simply saying, if you have a home it will
>> be sold to provide your care needs.
>> For a start the limit at which state aid kicks in should be considerably higher.
>>
As I asked earlier, does anyone know what has happened to the Tory proposal to reform this system and replace it with a one-off insurance payment?
Last edited by: John H on Thu 17 Feb 11 at 16:54
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>>As I asked earlier, does anyone know what has happened to the Tory proposal to reform
>>this system and replace it with a one-off insurance payment?
As we don't have a Tory Government, who knows.
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That baby got thrown out when they found out how dirty the bathwater was.
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>> That baby got thrown out when they found out how dirty the bathwater was.
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Must have done it on the quiet as there has been no mention of it anywhere that i can see.
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>> Must have done it on the quiet as there has been no mention of it
>> anywhere that i can see.
>>
Dug harder and found this:
16 February 2011
The Daily Telegraph, Tim Ross
"A place in a nursing home costs an average of £36,000 a year but anyone with assets worth more than £23,250 receives no help at all from the state.
Britain’s ageing population is projected to strain public finances further in the coming decades. An estimated 17 million people in Britain alive today will live to the age of 100. Experts predict that by 2026, the long term care and support system will have a funding shortfall of £6 billion without urgent reforms.
Before the election, all three major parties pledged to end the need for pensioners to sell their homes to fund the cost of care. The Tories vowed to oppose plans for a so-called "death tax", a compulsory levy to pay for elderly care. But Coalition ministers were later forced to admit that all options would be considered.
Lord Warner, a Labour peer, is on the three-person commission chaired by economist Andrew Dilnot and tasked with recommending to the Health Secretary, Andrew Lansley, a new system for funding long term care and support for elderly and disabled adults.
The inquiry is due to report in July but has already concluded that no single “silver bullet” solution exists, with individuals, taxpayers and family members all certain to share the burden."
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Isnt that a long way of saying "nothing is going to change"?
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>> Isnt that a long way of saying "nothing is going to change"?
>>
Waiting to find out which way it will go. All three parties are in on it, so something just might change.
"“This issue is not going to go away and we are going to have to try to come up with something that is politically acceptable and workable in this area.”
Lord Warner said there would always be "a safety net" of state funding to help the poorest pensioners receive the care they needed."
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Just read through the whole thing...
www.telegraph.co.uk/finance/personalfinance/8326605/Baby-boomers-must-pay-for-their-own-elderly-care.html
Interesting that they are looking at change but keep returning to the need for property to be a major part of future funding for care.
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Why are the feckless and useless always rewarded with benefits and free care? Those that are dim and throw their money away should be the ones at the bottom of the hand outs. Those that worked hard and saved up like responsible adults shouldn't be the ones paying for the idiots to have free care!
Simple answer is to sell your house and blow the money. Then the council can do nothing to you or your relatives!
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>> Simple answer is to sell your house and blow the money.
>> Then the council can do nothing to you or your relatives!
I'm not sure it's quite that simple - the state/council funding will be insufficient to meet the cost of even the most basic home.
The shortfall has to be filled by a "third party contribution" which the person in care cannot provide.
Guess who is first in the line to be asked?
A typical quote follows: "You can choose a more expensive residential or nursing care home if a friend, family member or charity pays the difference. This is called a third party contribution or ‘top-up'. It is paid directly to the home."
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>> state's responsibility for those who are, unable to
>> pay"
>>
>> That's quite a different individual from somebody who is asset rich like a property owner.
>>
On this theme, about who should pay, but on a diiferent matter:
Daily Mail online readers in England are treated today a story about a man who is not identified "The case also saw the couple, who cannot be named, receive legal aid despite the husband amassing a £300million fortune from his mobile phone firm."
Incidentally, the same story is covered by BoobyG's Jock-land newspapers
tinyurl.com/6y79thj ( www.heraldscotland.com )
has the man named. "Calls have been made for an investigation into how a mobile phone tycoon who was once one of Scotland’s richest men was granted legal aid in what is one of the country’s biggest divorce cases. J__ M_____, 47, was estimated to have a £300 million fortune before his firm crashed in 2009."
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>> J__ M_____, 47, was estimated to
>> have a £300 million fortune before his firm crashed in 2009."
Does it say what he has now?
EDIT: sorry, was the aid granted before his firm crashed?
Last edited by: Focus on Thu 17 Feb 11 at 16:39
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>> Does it say what he has now?
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Yes, details on the heraldscotland link.
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>> But not the DM link? Oh.
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Which one? ( I didn't guote one, just to keep you happy! ;-) )
The "Wail" says:
"His wife .... was yesterday awarded £1.6million in a divorce ruling.
The case also saw the couple, who cannot be named, receive legal aid despite the husband amassing a £300million fortune from his mobile phone firm.
But the hearing was told much of his wealth was spent on setting up a trust fund for the five illegitimate children.
Before his business collapsed, the man had enjoyed a lavish lifestyle and had once splashed out £50,000 on a holiday for his wife."
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Flog the house before care is needed and buy gold sovereigns or Krugerands.
Empty the old person's bank account.
No visible asserts to seize.
Hide the gold well and sell in small numbers/amounts when necessary.
Would that work?
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>> No visible asserts to seize.
>> Hide the gold well and sell in small numbers/amounts when necessary.
>> Would that work?
If you want free accommodation for yourself, rather than the relative.
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Avoiding sale of house for care fees/inheritance. - John H
