House in childrens name to avoid care home fees in future?

leedslad_2

My mum is moving house and I'm wanting some advice on whether it's a good idea to have the new house in mine and my brothers name. She will be paying cash for the house so won't have a mortgage. Me and my brother currently don't have mortgages also, so we would hopefully qualify as first time buyers and avoid paying stamp duty on the new property.

My mother is 58 and still in very good condition, so i don't anticipate anything happening, but I have heard that should she need to go in a care home in years to come then they would make her sell the property and use some of the money to pay for her care.

To avoid this could we buy the property in mine and my brothers names, maybe with a legal notice of interest or something stating that we would never sell the house without using the money to pay for another property for my Mum to live in whilst alive?

Is any of this worthwhile, or am i talking rubbish? i'm thinking it'd be worth it to save the stamp duty even as she could do with the money for a new bathroom! Thanks for any help.

henpecked1

capital deprivation rules tend to apply, but it would be the balance of time whether it looks like disposing of assets before care or something done before care was ever an option. the latter being your case

henpecked1

do remember if either of you divorce etc, the house will count as an asset!

Mojisola

Are you going to be living in the house? If not, you'll have to pay CGT at some point.

leedslad_2

my brother will be living in it yes, thanks for your help both of you.

Liquorice_Twirls

What happens if you get married, then later divorced and your soon to be ex wants their share of your "property"?

What if you have a run of bad luck or illness and your "asset" means that you don't get the full benefits to which you would otherwise be entitled?

It's a nice idea in theory but it's not a risk free strategy doing it the way you suggest.

Mojisola

leedslad wrote: »

my brother will be living in it yes, thanks for your help both of you.

So he won't be liable for CGT but you will.

beccad

Mojisola wrote: »

So he won't be liable for CGT but you will.

Depending on the value of the asset of course...

My parents haven't put their house in mine and my brother's names, but they have put it into trust for us, or something like that. I'm not sure exactly, but it means that if they ever become incapable it won't have to be sold.

theartfullodger

And remember, the government can (and does!) change the rules on these matters - eg how long gifts are made before they are disregarded, CGT rules (amounts, allowances..), the chances that if the ConDems have their way care-home fees will be less & less possible to wriggle out of etc. etc.

Don't gamble on the assumption of no changes to come. Your strategy could blow up in all you faces...

There are, obviously not a danger in this case, rather too many examples of apparently delightful children who after the gift is made become less than loving: Perhaps mum should consider this...

Cheers!

Lodger

pawlala

leedslad wrote: »

My mother is 58 and still in very good condition,

You make it sound like she's a second hand car! Is she taxed? MOT?

Mojisola

pawlala wrote: »

You make it sound like she's a second hand car! Is she taxed? MOT?

:rotfl::rotfl::rotfl:

I'm about the same age and my parents are still with us. There's no way I would be signing over my home to my children when I might still be here in thirty years' time! Heavens knows what might change in all that time.