gifting our home

[b.r.wade]

Hi,
My husband, who I care for, know that there is every chance that at some point in the future we are probably going to end up in some kind of care home.
We have a daughter (married with children) who lives some distance away and we would not want to have to have her give up everything to care for us.
When we first married we worked hard in order to buy our own house, we have never had holidays abroad or owned a new car (until motability) we were always determined that we wanted to be able to leave our daughter something when we were gone. We no longer have any savings (we don't get enough in benefits to save).
We feel very strongly that yes we made a choice to buy our own home in order to leave something to inherit but had we decided to go down the rented/social housing route + holidays and cars we would probably been in a position to give our daughter financial help prior to our demise we therefore strongly object that we will have to at some point have to have our home sold to finance a care home when had we chosen the other route it would be a care home would be free.
Is there anyway we can gift our home to our daughter now and remain living in it the value of our home is well below the inheritance tax level and assuming we live 7yrs + after gifting it we thought we would be ok to do this however during my research I came across this..................
"With regard to the gift of your home, there are certain exceptions to this rule if there is an unforeseen change in your circumstances in that you become infirm and are unable to maintain yourself through either old age or illness etc. In addition your occupation of the house must be only what might be expected as provision for your care and maintenance by the donee (person you have given the property to). Bear in mind for this to apply the donee must be a relative."
Does the 7year rule come into play with this or is the length of time irrelevant?
I fully appreciate that any advice anyone gives us is not neccessarily absolutely correct but I am asking for advice in the sense of guidance so that we know whether or not to go to a solicitor and talk to them (they charge now NO LEGAL AID anymore).
We would of course discuss this with our daughter and son in law in order to guarentee that it would be legal and that should they split up or fall out with us we would not be made homeless.
The other alternative that I have come across is perhaps Tennants in Common where we would give our daughter 98% and my husband and I keep 1% each.

Any advice anyone?

[ladybird17]

My Mum and Dad became "Tenants in Common" and when my Mum passed away, I inherited her 50% of the property. This was done about 5 years before she died, and she's been gone for almost 9 years now, my Dad is 94 and still living in the property, so it was about 14 years ago. I can only pass on what my solicitor told us at the time - and this is assuming I'm remembering correctly, so please don't take this as gospel! Apparently, there are some misconceptions about the 7 years ruling - it applies mostly to transfer of money - not all assets. If the Local Authority are assessing someone for residential care, they can take into account when the "Tenants in Common" arrangement was put in place and then (no surprise here) it will be up to them if they deem it to have been done in order to avoid care costs - I think the passage of time is obviously helpful - but there doesn't appear to be any hard & fast rules. Can you net get a free half an hour session with a local solicitor? If you do decide to go ahead with it, you will have to pay for it all to be drawn up - I really can't remember how much it cost, but I have a figure of about £600 in my head for some reason.

[crocus]

I am considering the same problem. Someone pointed out to me that even if gifting the house to a son/daughter can be done there is still the possibility that your son/daughters marriage may end or they go bankrupt and then your house will be considered their assets and may well have to be sold.

This is so complex that I would definitely consult a solicitor so that you dont make any mistakes.

[daylily]

Hi,
we actually gave MIL the money to buy her house, we had proof of the money transfer and sale, this was over 20 years ago. The LA still took 60% of the money from the sale when MIL went into a CH. This was because the house was in MIL's name, she always refused to sign it over to us saying there was no need as we would get it on her death. It was left to hubby in her will.
Obviously she never expected to go into a home.
Not much left of our investment when the CH bills were paid.

[bowlingbun]

This is a big issue for me too. My little cottage in the New Forest has rocketed in value, which is now going to cause inheritance tax problems for my children unless I do something. My mum has recently gone into a care home, and I wish I'd asked her to sign half the house over to me when dad died, rather than leave me half in her will. Too late now I'm afraid, her care home fees are £1100 per week!!! However, because of mum, I've come across something called the CRAG regulations - Charging for Residential Accommodation Guide, which might be useful reading for you - they are online. I've just asked for a copy of mum's financial assessment, and this deals with property ownership in details, what someone used to own, who owns it now, etc. etc. It is a very complex area, and if you want to transfer property ownership, then you would need to consult a solicitor in any case. Don't do anything without making sure, 150% certain, that it won't cause problems in future.

[Brian Roberts]

My parents took the tenants in common route and I inherited my mother's half when she died in 2003 and my wife passed away within weeks.
I went to live with Dad as a half owner occupier.
The social worker wanted the house sold to finance the fees but I just showed her Age Concern Factsheet 38 and she went on that the council would only finance so much and I would have to pay top up as there was no suitable home in the area at the council's usual rates.
I refused as he was in a secure ward in the hospital and she said Dad could be let out and he could kill a child because of his strength and I would be responsible.
After a lot of argument Dad's fees were paid by the NHS and I refused to pay anything.
If I had not been an occupier if Dad had not qualified for NHS funding the council may have been able to take half of the house.
There is a clause on the land certificate saying no sale or transfer without the consent of all owners.
I would have not given my consent for a sale and I am not sure if this would have stood up in court against the council.
I know somebody who split their house in to tenants in common shortly before the wife went in to care and they both left their share to the children.
Sadly the husband pre deceased the wife. The council only managed to get half of the house.

Brian

[Dancedintherain]

You definitely need professional advice ...consider contacting CUK professional staff or any of the charities for the elderly...my favourite(!!) is Age UK. I am an amateur but I am aware of some of the obligations surrounding deprivation of Assets...hence I urge seeking professional advice

concerning your FEELINGS on the subject, yes I understand what you say.

I too would like my children to inherit from me. However, I too may have to spend my money on my own care. In fact I wish I could sell up and hand the proceeds over right now and have the pleasure of giving lol and I hasten to add that NONE of my offspring actually "need" it.

It might help you to consider how I resolve my own concerns ok? Widening the picture?

I never inherited anything myself and let's just say that despite that I have managed pretty well. Luck and circumstances ... Not everyone is so fortunate. So I don't begrudge my taxes being used to support others whose circumstances may be different to my own.

I have always been independent since I was fifteen years old. I am a home owner, have always paid my taxes, my children will probably pay inheritance tax and am pleased I will not be a burden to my family financially. Nor to the state.

I am pleased that unless I live till I am 120 years old I will remain at least financially independent.

paying for a roof over our heads has always been our basic endeavour yeah? And so when we need MORE than a roof over our head (ie. Residential care ) ....then is where the money goes. If the money runs out, the State takes over. Seems logical to me. Those who have enough cash to pay ....pay. Those who do need support ...should receive it. A civilised society. What is the alternative?

When in care, instead of paying utility bills, food bills, council tax etc ... We will be paying for everything in One Go to One source only.

I think I have come to terms with it. I hope you do too. let's not ruin our later years dwelling on things which probably cannot be changed.

[Dancedintherain]

BowlingBun. I see you have posted elsewhere something about the SS asking you for top up fees. And another post saying that your MOTHERS money is in a joint account so SS have only included half of it in the financial assessment. A ruse?

maybe you also put half of the money in, personally I don't care. But if not, with respect,can I suggest you be careful about Internet security.
Just something for you to consider. And if you feel offended ... Do try to accept that I am trying to help you. And if you can't,,,just post on here if you want me to delete this post, I will happily do so if it makes you feel more comfortable.

DR

[bowlingbun]

DIR, I have POA for mum (she doesn't have dementia, just doesn't like dealing with money, because dad did all that before he died). SSD told the new care home that I would be paying the home directly for "top up" fees, without asking or telling me, in contravention of the relevant CRAG guidelines. Now subject of a formal complaint. When I have the reply from SSD, it will all be passed to the solicitor. I have a joint Halifax account with mum, because that was what the Halifax wanted, so I could deal with the pass book account mum insisted on having. The CRAG guidelines say that if you have a joint account, for assessment purposes, only half counts. I believe that we need to share this sort of information. Many people may never have heard of the CRAG guidelines at all (Charges for Residential Accomodation Guidelines). As for my security, in connection with my business, all my contact details, name address and phone number have regularly appeared in national lorry magazines for many years!

[Brian Roberts]

Hi DR

My mother wanted the house split in to tenants in common ownership mainly because she did not want Dad to possibly get married again and all of her money possibly go to another family.
My in laws took the same attitude.
In both cases they set up their wills so I was the first beneficiary if I was alive at the time of their death and my wife would be if that was not the case.
My in laws set up their will on a similar basis so my wife was the first beneficiary if she was alive at the time of their death and I would be if she was not.
Sadly my wife pre deceased my in laws and I got both estates.

I moved in with my father after my mother's death and sold my house. As I owned half of the house social services could not take any of the house to pay for Dad's care. I thought that was fair as I had been caring for Dad but social services did all they could to try to persuade me to sell by saying it was unfair to expect the taxpayer to pay when Dad had a half share in a £400,000 house although he had almost no money in cash terms.

Legally I knew social services could not force me to pay or sell and after a lot of argument the NHS had to pay because Dad was violent because of his dementia and he had a lot of strength.

Unfortunately in life you have to think of your self and family first.
Social Services could not care less about me. They did not know how much money I had. They just wanted the house sold and me to be homeless if necessary.


Brian