Taking on my Dad's house

grant.smith

Sorry if this is in the wrong section, didn't really know where it fit's.

In short, my Dad is getting to an age where sooner and hopefully later he may need care. My Dad doesn't want the government to use this house as capital to fund any care he may need. To combat this he want's to sign the house over to me and my brother.

This all seems fine, I will do anything to help, however, financially I'm not a big earner and wondered if this would effect me in anyway. I guess I'm thinking in terms of tax, because on paper I am would be part owner of two properties. My Dad's house, and my actual family home.

Also, is this legal?

Essentially I have not a clue and wondered if anyone here has experience on the subject which they wouldn't mind sharing.

Trying_to_be_good

Many people would do this if it were allowed, but in short, no, this isn't allowed. Depriving yourself (i.e. your Dad gifting his house to you and your brother) of an asset isn't allowed, and the value of the house will be taken into account when calculating his care entitlements. There'll be a lot more about this on the benefits board, so you might want to post there.

So it's not a just matter of your tax position (capital gains tax to pay on the house, any rental income declared, potenital inheritance tax if your Dad should sadly pass within 7 years) - it wouldn't help you Dad in his aim to stop the house being used to fund his care needs.

This could change with lots of talk about how fair it is, but as the government's skint, I wouldn't hold your breath for a change anytime soon.

Oldernotwiser

As has just been said, what you're trying to do isn't allowed.

Reassure your father that only a very small minority of people actually need to go into residential care and he can fund any extra help he might need to stay in his own home by drawing on the equity in his property.

calshark

I am intending to purchase my girlfriends mothers house for a similar reason. I buy the house and she remains there rent free , did not realise this was illegal . I am on poroperty ladder and partners mum has money to enjoy ??

Oldernotwiser

calshark wrote: »

I am intending to purchase my girlfriends mothers house for a similar reason. I buy the house and she remains there rent free , did not realise this was illegal . I am on poroperty ladder and partners mum has money to enjoy ??

It's not so much illegal but if she had to go into residential care in the near future she could be treated as if she still owned the house

getmore4less

If care is required on medical grounds it should be covered by the NHS.

It is social care that is means tested.

CLAPTON

calshark wrote: »

I am intending to purchase my girlfriends mothers house for a similar reason. I buy the house and she remains there rent free , did not realise this was illegal . I am on poroperty ladder and partners mum has money to enjoy ??

as already said not illegal

but you need to consider
-deliberate deprivation of assets for care purposes
-Capital Gains Tax when you come to sell the house
-IHT when your GF mother dies if her estate is large enough)

you say purchase ...where does the money go?
and of course if you and GF fall out poor old mum is out in the street

in any event won't your GF want her mother to have the best care available rather than what the council decides for her?

grant.smith

I'm not looking to buck the system in way here, but surely you only pay capital gains tax on items you inherit. And even then, only if the estate is above a certain value, which I'm pretty sure my Dad's isn't. If I legally owned the house, I haven't inherited it. It's mine already.

And my Dad isn't gifting me the house, I will have to buy it, albeit at a silly price.