Deprivation of Capital

shedboy94

I've been reading up a bit on this subject but was unsure on a couple of issues
I realise there is technically no time limit on the subject, but what would be deemed as reasonable? If for an example a house is transferred, and at the time there was no indication whatsoever that care would be required in the near future, but it was say 10-15 years later, would there be any problems with this?
Secondly, in cases where it has been deemed there has been depravation of capital and the person/s need to go into a care home, what happens if the only asset they had (house) has been legally signed over to someone else - do the DWP/whoever have any legal rights to the property or can they deny the person/s access to a care home?

BigAunty

You might get specific answers for this on a charity website that deals with elder care, such as Age UK or similar.

As far as I know, there is no time limit and a person who has given away their capital can be treated as if they still have it (known as 'notional capital'). How that works in practice, I don't know.

shedboy94

Thanks, it's all kind of theoretical at the moment, but may become reality in the future!!

ticktack_2

shedboy94 wrote: »

I've been reading up a bit on this subject but was unsure on a couple of issues
I realise there is technically no time limit on the subject, but what would be deemed as reasonable? If for an example a house is transferred, and at the time there was no indication whatsoever that care would be required in the near future, but it was say 10-15 years later, would there be any problems with this?
Secondly, in cases where it has been deemed there has been depravation of capital and the person/s need to go into a care home, what happens if the only asset they had (house) has been legally signed over to someone else - do the DWP/whoever have any legal rights to the property or can they deny the person/s access to a care home?

Agree with the other poster that it might be a good idea to ask for advice from an older person's charity. See http://www.counselandcare.org.uk/financial-factsheets

In answer to your specific questions, there's no time limit, intention can be taken into account, and the recipients of the property can be charged for the fees. Factsheet 2 says:

"There is no time limit for how far back your local council can look at your financial affairs during the financial assessment. If the local council decides that you have deprived yourself of capital or property during the financial assessment, the council will include the full value of the capital/property (even though you no longer own it) in your financial assessment and may consider that you have ‘notional capital’ (still have the value of that asset) and charge you as such. If the value of your actual and notional capital is over £23,250 (in England) you would be expected to fund your own care until your capital drops to £23,250 (in England). The local council should reduce the amount of notional capital each week by the difference between the rate which you are paying for the accommodation and the rate you would have paid if you were not treated as possessing the notional capital."

[...]

"If the local council decides you have deprived yourself of capital but you are unable to pay the care home fees in full because the capital has been transferred/spent, you (or the person who now has the capital) may still be liable for the full cost of the care home fees..."

In other words, it's not that the person is "denied access" to care, it's just that the new owners of the property will be charged for the care debt (if deprivation is deemed to have occurred). Which could mean they would have to sell the property to pay the debt.

But (it says elsewhere in the factsheet) the local authority can take "intention" into account and could decide that it wasn't the person's intention to deprive themselves, and in that case they might decide that deprivation has not occurred. This is the part you really need one-to-one advice about.