OK to give my sister our dad's Attendance Allowance for looking after him, using POA?

cashferret

My sister has been looking after our dad, who has severe dementia and serious health problems, for the last six months, in her own home. During that time, he has been receiving Attendance Allowance. She has applied for Carer's Allowance and is appealing a decision not to grant her it because she fails the means test (by about a quid over the £5k/year income limit based on last year's earnings!).

She is self-employed and has hardly been able to work this year for looking after Dad. We employ sitters during the day using his money (which we control on his behalf using Power of Attorney) but 24-hour paid care would be too expensive on an hourly basis and he'd have to go into a home (which isn't as good for him).

As a family, we feel that she should received Dad's Attendance Allowance to compensate her for lost earnings and because she is doing the work of caring for him; she's saving him a lot of money by doing the care for nothing. We're sure Dad would want her to have it if he was aware of his situation and that he'd also want to make sure that she wasn't out of pocket on all the little expenses that add up but for which she can't provide receipts (petrol to take him to hospital etc.).

Legally, is there any problem with her writing herself a cheque on his bank account to pay herself his Attendance Allowance, plus something for the non-receipted expenses? I know that as attorneys we are supposed to be able to account for the money if required to do so with receipts etc. But it would seem weird for her to bill him for her time (presumably we'd then be into employment law, etc. if she was treating herself as providing a billable service).

dazzadub

who has the power of attorney normally you have 2 persons. maybe the other person could do a cheque

other thing i think you can do i request pin numbers for bank cards and also be able to draw on the account.

cashferret

Actually, is there anything to prevent her from charging him rent under the rent-a-room scheme, as part of it?

Or if she gets rental income from him, is that going to affect her Carer's Allowance application?

cashferret

dazzadub wrote: »

who has the power of attorney normally you have 2 persons. maybe the other person could do a cheque

other thing i think you can do i request pin numbers for bank cards and also be able to draw on the account.

Hi dazzadub - I'm the other attorney and could write the cheque or she could draw cash (we have cards on his a/c) but the question really is, is it legal to do that without providing a receipt for a billable service or something similar?

Mojisola

Wouldn't this work much the same way as adult children contributing to the household while still living at home? I can't see why she shouldn't receive money each week to cover food, heating, power, washing, car use, etc. That way you can keep records of it as his contribution to household expenses.

cashferret

Mojisola wrote: »

Wouldn't this work much the same way as adult children contributing to the household while still living at home? I can't see why she shouldn't receive money each week to cover food, heating, power, washing, car use, etc. That way you can keep records of it as his contribution to household expenses.

Thanks, Mojisola - but everything billable like that we are already reimbursing my sister from his account (even the stuff where we have to estimate the bill, such as the proportion of car use that is due to him). It's her time and effort that we want to recognise, in part because we think she should be rewarded for them and in part because she is losing earnings - she can't do her self-employed work while she's looking after Dad.

I've just started wondering if we can't just pay her a tax-free gift from Dad. I'm looking on the HMRC site to see if there are limits.

cashferret

Well, I just got some phone advice from a local probate solicitor - fortunately didn't have to pay because we didn't get to the point where she had to go away and research it, at which point it would have been £200/hour!

Her advice was that attorneys can't get paid for stuff that the do in their role as attorney - so any admin work that attorneys do, they can't get paid for by the donor. Care is another matter because that's not an attorney's role, just what you do as a family member but to get paid for care you'd need a contract and then you would be into a complicated area. She said you are generally in a grey area when you are renumerating for help someone who is also an attorney.

She said attorneys can't make cash gifts on the donor's behalf so that's out; she said the safest way to get my sister some recompense would be for her to charge Dad rent, but then of course that would affect her Carer's Allowance claim.

She also said it's easier to justify spending money that comes out of the donor's income rather than that you're taking out of their savings.

She also said it's best to get any agreement to pay my sister in writing and signed by all three attorneys (there's another one).

She said it's right to be cautious; if the local authority get involved in care they can demand accounts and (I didn't note this but I think she said it), if there are inheritance tax implications then HMRC can also ask to see accounts and will be looking out for inheritance-tax dodging.

nannytone_2

if paying your sister a 'cash gift' from yoyu fathers account, would mean him then becoming eliegable for means tested benefit, it would be seen as deprivation of capital. why doesnt your sister just cut her hours to the permitted earnings limit, if she is only just slightly above?

cashferret

nannytone wrote: »

if paying your sister a 'cash gift' from yoyu fathers account, would mean him then becoming eliegable for means tested benefit, it would be seen as deprivation of capital. why doesnt your sister just cut her hours to the permitted earnings limit, if she is only just slightly above?

Hi - my Dad isn't eligible for any means-tested benefit. My sister is self-employed and her income isn't based on any kind of payment for an hourly rate. Similarly, she hasn't been charging for care and so doesn't get paid an hourly rate for that.

I have a feeling I have missed your point - sorry!

nannytone_2

my point was, that if your father isnt intending to claim means tested benefits, there is no reason why she shouldnt be paid from his money.

cashferret

thanks, Nannytone - the problems with her being paid are to do with it possibly affecting her application for Carer's Allowance if it looks like income, and the general question of whether it's OK for attorneys to receive money for giving care to a family member. The solicitor's advice suggests it's a very grey area for her to get paid for care.