Inheritance help

BobQ

littlemissbossy wrote: »

Just to add, when my inlaws got to the savings level where the council contribute, I had to attend a meeting, produce bank statements, DWP paperwork, they are looking for deprevation of assets (as others have mentioned), if they think this has happened your father will be assessed as if still having the money and therefore getting no help. I believe different councils have different rules for how far they look back - so not black and white!

Can I ask why you were asked to do this, and indeed did it? I appreciate they may look for such things in the financial affairs of the applicant but did they want to explore your finances on specific grounds or was it a fishing expedition? Did they refuse help unless you submitted to the investigation or did they have reasonable grounds to look?

BobQ

Goodie100 wrote: »

I think that last post was a bit harsh! My dad has worked hard all his life and still at 71 does a day a wk gardening. He has paid all his taxes and has never claimed anything.he not use to having this money and it's confusing him. He's not trying to cheat anyone he just wants the best for his children. If you ask me I think he's to generous by giving £50000 of his money away I'd rather he kepted the lot and enjoy the rest of his life like he deserves but my brothers want their inheritance. It's a tricky situation and I would like so advice not a character assinination of my father thanks.

I think it was harsh too. Never mind there will be some cretin along in a minute questioning your motives too:)

I do understand that elderly people who have never had much money in the bank actually get worried about the matter. My suggestion is put the money in a new account in your Dad's name and arrange for him to give you Power of Attorney over this one account. This will keep his money in his name and your involvement in using it demonstrably separate from your own affairs.

They cannot stop him spending his money as he wishes but doing a transaction into your personal account as a big lump sum will ensure that not only his affairs are scrutinised but yours too in the event he needed a care home.

BobQ

Yorkie1 wrote: »

3. As previously stated, there is a risk to your father in giving away the money / putting it in accounts not in his own name, even if it's just for 'safekeeping'. This is because he no longer has legal title to the money. If you went bankrupt, or divorced, or died, then the money would be at risk of being claimed by others - and would be completely lost to him.

Frankly, this is a major issue and he should obtain independent legal advice on this point alone because I'm sure he will otherwise just dismiss the concerns as "it won't happen", or "they'll see me right" when this prediction may well be far from the truth - for whatever reason - if the situation arises.

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This is good advice. I have a friend who did this sort of thing and persuaded his two sons to put the money into a joint account. Then one of them had financial problems and persuaded his Dad to let him use some of the money as a short term loan which then grew larger and longer. One day the other son was on a business trip overseas for a few weeks and when he got back all the money had gone from the account, apparently invested in an investment property. Three months later the son confessed he was going bankrupt and the money was gone. Of course he assured his Dad that the money would be returned one day but 20 years later he is still making his excuses while the Dad is living in fairly abject circumstances.

Not suggesting the OP is in anyway like this chap's son but people do some terrible things when it comes to money.

YesWillMan

Surprised no one mentioned that a Deed of Variation could be done where some of the £100 k could be paid to the sons as a "legacy" effectively from the estate of the original person who died. Of course this death would of had to have been within the last 2 years.

xylophone

Deed of Variation could be done

Might still lead down the same DOC street?
http://www.moneysupermarket.com/community/forums/t/deed-or-variation-needed-or-not-48903.aspx

getmore4less

YesWillMan wrote: »

Surprised no one mentioned that a Deed of Variation could be done where some of the £100 k could be paid to the sons as a "legacy" effectively from the estate of the original person who died. Of course this death would of had to have been within the last 2 years.

DOV don't work like that, so things are not that simple.

getmore4less

ed123 wrote: »

"but my brothers want their inheritance" err.... one normally only receives ones inheritance after someone has died. The maximum you can give away each year is £3000pa for seven years before death. Higher amounts /death before seven years would attract inheritance tax. If he is receiving pension tax credit then by giving this money away would be classed as deprivation of capital and he could be done for fraud by the DWP.(similarly re care home costs). At 71 it can't be that "confusing" for him to place the money in a couple of savings accounts in his own name and declare the amount to DWP and HMRC(re saving interest he may even be due some tax back from HMRC)......ed

The gifts use up the nill rate band in order(with rules depending on size) leaving a smaller nill rate band for the rest of the estate.

If the total estate including the gifts is below the nillrate band here is no IHT to pay.

littlemissbossy

BobQ wrote: »

Can I ask why you were asked to do this, and indeed did it? I appreciate they may look for such things in the financial affairs of the applicant but did they want to explore your finances on specific grounds or was it a fishing expedition? Did they refuse help unless you submitted to the investigation or did they have reasonable grounds to look?

Sorry, I don't think I made myself clear, it was only my inlaws affairs they looked into, I was at the meeting as I help them with their finances and had all their paperwork.