Parents and their will...

lowis

not sure where to put this post...please move it if i am in the wrong place.

my parents have recently been to see a solicitor about reorganising their will, they basically want to safeguard against 1) having to sell their home if one of them ends up in full-time residential care and 2) paying inheritance tax to the (labour) government (not sure whether they would be happy for the Tories to get their money or not!). there won;t be too much inheritance tax to pay, they are only just over the threshhold i think, they are mostly concerne about point one i mention.

they have been advised by the solicitor to put a proportion of the house into some sort of Trust which can only be drawn upon if they, myself and my brother all sign an agreement sanctioning any withdrawal.

does this advice sound about right? sorry to be so sketchy but i am working on info passed on by my parents and i am not too sue they fully understand what the solicitor has told them - i have advised them to get the solicitor to re-explain.

dunstonh

If the property is owned as tenants in common and a trust is in place to put half the property on first death into trust, then the property cannot be sold or used to cover residential care costs. It has been tested in court by three authorities without success (for them).

Investments can be avoided from being used as assets if they are within the investment bond tax wrapper.

lowis

hi dunston
that sounds like what my mother was trying to convey to me.
do you have any links to any further info about this practice?
thanks

margaretclare

In answer to your first point, if one of them goes into full-time residential care and the other one doesn't, then AFAIK the home can't be touched. This is happening to an old couple I know of at the moment. Mum is in a home and Dad is still living in their own house, and no one has suggested that he shouldn't.

It's worth remembering that it's still only a minority of people who end up in full-time residential care so they may be worrying about something that may never happen! The threshold for inheritance tax is set to rise, if they're only just over the threshold at present it's possible they may be below it in the future.

Why worry about which gubbmint is in power once you're dead and gone?

Margaret

lowis

thanks - i think my mum and dad just want to plan for the future and cover all eventualitues - plus they are recent grandparents so i guess this new development has made them reassess things.