Passing on the family home

joho · 25 February 2006 at 12:18PM

Mum is 64, widowed, still working full time and in good shape!

But we need some advice on what to do with the house because she doesn't want to have to sell it to pay for any care home fees.

I understand as long as she signs it over to me at least 7 years before she is likely to need care, and then pays a market rent for it, it can't be sold to pay fees.

But she can't afford to pay rent and doesn't think she would get any kind of benefit to help her do so because she would be paying it to a family member. The house is mortgage free.

Anyone come across any useful info?

Bossyboots · 25 February 2006 at 12:51PM

No, you have that a bit muddled. If she signs it over to you and survives 7 years it would be a gift free from inheritance tax. However, if she continues to live in the property then it becomes a gift with reservation and will still be counted as part of her estate for these purposes.

Also, if the DSS believe she has signed it over to you to avoid care home fees they can apply to the court for that to be overturned. Obviously the longer the period of time from signing over to needing care the better to avoid this but if she is living there and paying rent to you, I think it would be obvious to anyone why that is. I have not heard of a limitation period in this regard but someone else may know better.

Dora_the_Explorer_5 · 25 February 2006 at 1:19PM

Have a look at Age Concern Factsheet 40 on the Age Concern England website, it covers deprivation of assets and strongly suggests legal advice should be obtained. A local Age Concern will be able to give further information on this as it is a frequently asked question. The thing to remember is that it's a common situation for local authorities as well, they're not daft and have to stick to the letter of the law.

margaretclare · 25 February 2006 at 3:37PM

Yes, Dora is right that this is a frequently-asked question. However, logically - something like 10% of all older people end up needing residential care. That means that around 90% don't!

Mum is 64, widowed but still working and in good health. As I was at age 64. At age 66 I remarried.

Your Mum is still a spring chicken! If/when she ever needs residential care, it's likely to be more than 7 years ahead, maybe 10 or 20, if at all. She may have other plans in the meantime, or other possibilities may arrive out of the blue, as they did for me. Good luck to her.

Aunty Margaret

margaretclare · 25 February 2006 at 4:06PM

Hi Joho

Another thought - you mention 'the family home'. If this is the home where Mum and (late) Dad brought up the children, it may be too big for her now. I am a great believer in making plans and changes for later life, not the kind of things that you mentioned, but simpler things like 'is this house too big/is the garden getting difficult to manage/do I really need all those bedrooms, and the stairs, and the bathroom with a bath which may become difficult to climb into?'

I lived in this 2-bed 1930s bungalow from 1990 so I couldn't 'downsize', but if I lived in (say) a 3-bedroom house I would certainly have sold it in favour of something smaller and more manageable. In any event, over the last few years we've spent time, thought and money in modernising throughout to make it easy-care and convenient. These are the kind of things I strongly feel everyone should give consideration to. It's much easier when you're in your 60s and still fit and well. Much more difficult later.

Aunty Margaret

joho · 28 February 2006 at 6:26PM

Thanks all! Lots to consider. Would thank you all individually but have lost my thanks buttons!! And yes house is too big - but she currently has my brother living with her although he is lloking for his own place!

Passing on the family home

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