'Should you be forced to sell your home to pay for long term care?' poll

nczm

This is a horrible subject, care of the elderly has always been something that tax payers are entitled to - I don't see why one person should be penalised by having to sell their assets if they've worked all of their life, saved their money, paid their taxes and generally built an inheritance for their family (there's already a tax on that) - when other people who do not contribute receive the same treatment.

louiser123

i have already posted on a thread similar to this but my views are simple and my actions are also simple.
we have already decided the fate of our house! we aim to sell it in 5 yrs time, (we have a substantial amount of equity in it once the remaining mortgage is paid) we will both be 50. we will be placing some away for our retirement as our pensions both state and private will be carp. we will then give some to our daughters and watch them enjoy thier inheritance from earth rather than heaven.(thats if we actually end up there may be down below!) and with the rest we will have a good time, seeing and doing all the things we want to do but have not had the cash to do them while we are still in good health and can enjoy them.
we will move into a smaller rented property which after adding up the mortgage payment, insurances for the upkeep of the property, maintainence and utilites ect will be about the same cost. then if the house needs something its up to the landlord to provide.

this isnt to prevent us paying for long term care but it is what we did the home buying thing in the first place for, and i see it as our right to be able to sell something we have bought and do with the proceeds what we want.

jamesd

louiser123, you should really discuss that plan with an IFA found via unbiased.co.uk or better, personal recommendation. You can use an "investment bond" to retain full control of your money while preventing the capital from counting for the means test if you do this while there is no sign of a need for care for either of you. An investment bond is a form of tax wrapper a bit like a pension or ISA are. The capital remains to be inherited, the income would count towards the means test. Note that it's important that there be no mention of this as the reason in the documentation provided by the IFA, usually investment in lower risk investments and potential tax benefits will suffice.

It's also worth knowing that from 55 you can start taking income from a personal pension using "income drawdown" if you like. You can then pay that income into another pension and get a second chunk of tax relief on the money on the way into the second pension. It's important that you use income drawdown and ake the income from investments instead of an annuity because at 55 you'll probably still have many years to planned retirement and need to do this in a way that doesn't reduce pension capital value growth.

louiser123

thanks james, but the plan has nothing to do with evading any costs in the future it is simply that we decided to use some of our savings which are tied up in our home to enjoy ourselves while we still can. we have planned well and there will be no more left in our bank than we are allowed anyway.

jamesd

Then with that plan there's less need for an IFA, though one could perhaps advise you on investments that would help the money to last longer at the spending rate you're considering.

steve_luton

Overall my opinion is that care home fees should be taken care of by the individual (not the taxpayer) and should form part of retirement planning along with pension provision. This could include the sale of property, other investments and perhaps there are insurance schemes which could cover the costs?

The problem is that in this country, we have become used to not having to look after our elderly relatives ourselves, but we also don't want to pay someone else to do it!

Yes it's galling that someone who hasn't worked or bought a property gets care without having to sell their property - but all people who work could use the same arguement about those who claim benefits instead of working for a living.

alduncan

Deleted_User wrote: »

If someone needs to go into care for SOCIAL reasons then yes, of course they should pay if they are deemed to have assets andcan afford it.

If someone needs to go into care for HEALTH reasons, the LAW - as determined in Coughlan - says the NHS have to pay.

I am surprised such a blinkered poll as this as been posted on the site without determining the difference between the 2 scenarios above,

The whole issue of paying for care is highly complex but can be split as above - I recently tried to get MSE to pick up this important topic and try and highlight the ongoing scandal of sick people losing their homes in paying for care that the NHS should be funding.

I pm'd MSE and the shoret version of the short reply was no - it;s not something we can do. If there has been a change of heart then please - at least do some homework first instead of posting a poll as though it were a simple black and white issue.

See my post above- the line between 'health' and 'social' care is a big blur when it comes to diseases like dementia. The state decide which you are under- and they are pressured to err on the side of social care because then they don't have to pay anything! So then if someone is labelled as needing 'social care' the they pay EVERYTHING while while those with more well-understood physical diseases under the NHS pay NOTHING, even though the needs may be very similar. This is completely unfair!!

hellywobs

In my view funding care for the elderly should come ahead of any reductions/abolition of inheritance tax.

With IHT you get about £350K tax-free and 60% of everything else (very simply put depending on who you are leaving £££ to, charities etc).

With care you get about £20K and lose 100% of everything else.

I agree that the distinction between health care and social care is a very blurred one. However, lots of people can manage in their own homes with some help with cooking, cleaning, ironing etc which is much cheaper than being in a care home, but is being cut like mad.

There's no easy answer to all this - it's very expensive - but maybe there should be tax incentives for taking out insurance, like you get when taking out a pension. I definitely think that there should be more parity between the care thresholds and the IHT thresholds.

I know people get terribly upset about IHT (I'm being taxed on what my dad already paid tax on etc etc) but my view is that you're getting something for nothing and therefore you're doing ok. Anyway we constantly pay more tax out of money we've already been taxed on, eg paying council tax and VAT out of income that has been subject to income tax.

A civilised society should look after its elderly properly (after all they have also paid into the system all their lives) and although I'm sure family could do more, if you are looking after children and working to keep a roof over your head it's very hard to find the time to care for an elderly relative as well. Hats off to those who do.

nellykim

Dad is 91, and signed his house over to us almost 20 years ago, as he said he didnt want the state to get it. He is in good health. Has about £40k in savings. Does not owe anything to anyone, but says since he worked all his life, he wouldn't want to leave his home to ' the people who take your dignity from you' ie, the residential home owners, whoever they are.

Doc_N

nellykim wrote: »

Dad is 91, and signed his house over to us almost 20 years ago, as he said he didnt want the state to get it. He is in good health. Has about £40k in savings. Does not owe anything to anyone, but says since he worked all his life, he wouldn't want to leave his home to ' the people who take your dignity from you' ie, the residential home owners, whoever they are.

I wish the deprivation of assets rules were clearer on transfers of assets. Some local authorities seem to be able to get away with attacking transactions carried out a very long time ago........