Tax Implications??

alun4

dzug1 wrote: »

Probably yes - but there's still the actual legality of doing it in serious doubt. You cannot just help yourself to the assets of someone who is not capable of making decisions for himself.

Totally agree. The morality has been questioned above so I would have liked the OP to have expanded.

Errata

If the father has full capacity to make decisions about where his money goes, then he can. In view of his very serious health status capacity may be doubtful. If this is the case, only those with his Power of Attorney can make decisions on his behalf, and those decisions must benefit the father. Putting his money into someone else's account will not benefit the father.

RAS

Are your uncle and brother attorneys? have they regisitered with the Public Guardian's office? if not and father is that ill, why not?

And if they have do they do understand that what they are proposing is enough to get them removed as attorneys?

dazed75

Thank you for some interesting feedback.

Firstly re-reading my original post it may appear to be cold and heartless, this was never my intention, its been a heartbreaking few years seeing the gradual decline both mentally and physically of my dad. Throughout the process that we have been through, all we have wanted to ensure is that he is getting the very best care possible.

My dad is far from being able to make any decisions for himself; my brother and uncle have Power of Attorney, both my Dad’s solicitor and the banks are fully aware of the situation that he is in. From the beginning his financial status has been fully transparent; every step has been explained and illustrated to me, if at any time I have wanted to see his accounts, I have been able to do so. My uncle has always acted with my Dad’s interest at heart and having got to know him as well as I have over the last couple of years, I have no doubt about his intentions..

mackemdave, I do not see we have done anything wrong, Local Health Authorities have grants in place, we just applied for them. They would have known the full background of my dad’s finances and he obviously fell into the category that could be helped. My dad has worked hard his entire life; it’s only now that he is getting any kind of help.

In reflection perhaps I shouldn’t have posted this on the forum. This weekend I am seeing both my Dad and brother, so I will be able to discuss all these issues then; there is obviously much to cover, I know the last thing that either of us want is to be doing is anything inappropriate!

Errata

If they have POA, their job is not to shift cash from the father's account to other relatives accounts to avoid tax, their job is to ensure his finances are handled correctly and legally.

RAS

dazed

Before you go to see your uncle and borther you need to read this http://www.publicguardian.gov.uk/decisions/decisions.htm

Not sure if your brother and uncle have an EPA or LPA but in either case paying money from your father's investment into your accounts would be against the rules.

WhenI was in this position we consulted lawayers and were told the only "gifts" we could make were normal value Christmas and birthday gifts to the children and Christmas and birthday cards to friends and family. We had to pay quite a lot of IHT as a consequence.

dazed75

Thanks alot Raz, thats very helpful, this is all very new to me, so I shall do some reading up tonight......

mackemdave

dazed75 wrote: »

mackemdave, I do not see we have done anything wrong, Local Health Authorities have grants in place, we just applied for them. They would have known the full background of my dad’s finances and he obviously fell into the category that could be helped. My dad has worked hard his entire life; it’s only now that he is getting any kind of help.

A lot of other people have worked hard during their lives....My Mum is in her own warden assisted flat her 94 yr old neighbour who was a very very active lady recently suffered a stroke and is now in a home her only asset her flat,worth less than £200K is having to be put on the market to subsidize her care fees.....so reading that you father has assets in excess of £325K and his family are harping on about how to evade IHT as he isnt having to contribute to his care fees is in my opinion very very wrong........and I bet my Mums neighbour isnt the first person to be in this situation....I think you should be very very grateful that you are going to inherit most of your fathers estate and just accept that some of it may have to be paid over in tax,there are ways and means of legally avoiding IT

RAS

mackemdave wrote: »

I think you should be very very grateful that you are going to inherit most of your fathers estate and just accept that some of it may have to be paid over in tax,there are ways and means of legally avoiding IT

There are indeed but unless these are designed primarily to actually help the OP's father, rather than to reduce the IHT liability, attorneys are not allowed to use them. Everything you do has to be to benefit the donor during their life time.

alun4

dazed75 wrote: »

Hi,
Last week an application to have all care costs paid for by the local council was granted (full Continuing Healthcare), as a result dad no longer has any expenses to contend with

Are you sure it is not just the "all nursing care" element that has now been granted?

I have a relative who is totally self funding but she does still get attendance allowance and a nursing contribution which the nursing home was able to help support after the situation changed and she requires full nursing care.