New home in daughters name?

Mojisola

susannicola wrote: »

friends of mine did this 20 years ago and no problems at all, they still live in house that is in sons name, we thought they were silly at the time but dont think so now.

There has been quite a big change in house prices over the last 20 years. I would rather the capital in my house was spent on my choice of care home rather than go in CGT paid by my son when the house was sold.

dotdash79

Could you look at getting an insurance policy against care home cost to protect your house for your daughter.

holly_hobby

This is what it is I am afraid.....

Indeed the OP has confirmed that this exercise to directly facilitate a deliberate deprevation of assets, for any future care home needs. To which I suspect the LA will see this as such (ie why would parents sell a property and pch a replacement home but place in childs name) - you can see it wouldn't take Einstein to work out what the underlying motivation was. And as such, the tsf can effectively be treated by the LA as never have taken place.

Much goes for the PET angle on this - there isn't any re capital used to pch the new property.

Whether parents gift their current property to child, or sell and use the capital to pch a replacement (in childs name) - they are still continuing to enjoy the benefit of their capital - and it will therefore (as quite rightly said) come under GWR regs - which to be fair will only have an impact IF their net estate on death exceeds unused nil rate threshold. (325k pp or upto 650k if there is spousal tsf exercised by the decds administrators/executors). Any cash they give her, in excess of the annual IHT exemption amounts of 3k per person (which for the first yr can contian unused relief from prev yr), WILL be a PET, and subject to the 7 yr clock.

If the GWR will cause issues re IHT liability, paying market rent with all associated expenses managed under a traditional landlord/tenant relationship (inc reviews) would mitigate this.

However, if they pay less than market rent, and/or expenses are not managed as per a traditional lettings relationship, they will fall foul of POAT regs. Which means that if the benefit in kind on the associated rental/costs exceeds £5k pp per annum (10k per couple per annum) - they will have to declare the whole benefit as part of the annual SA return, and be exposed to income tax on it. If the benefit is less than this, then there is no need to report it.

Moving away from this.

Property in childs name, will be exposed to the TIB (on any BO order), any creditor re charging orders, and DWP for any MT benefit application. With inclusion on any estate division on marital breakdown or pre-death of the child. Further exposure to CGT on disposal for the duration it doesn't qualify for PRR relief and less unused annual CGT exemption.

So if there are likely to be IHT issues for your estate, this exercise may cause far more damage than it solves .....

If your aim is to efffectively ringfence your property from LTC exposure, I would suggest speaking with a qualified Long Term Care adviser, whom will assist in sourcing suitable solutions to your requiremens, inc the utilisation of annuity plan(s) where appropriate.

Hope this helps

Holly

couponqueen123

poledancer49 wrote: »

Just as I expected....or course..my daughter getting rich because I have never claimed a penny from the state all my life and I have paid for every penny for the house I own. I don't plan to get ill but lets just give the money to the state now and save all the hassle.

this is simply untrue and u know it lots of people die with out needing care/give up there homes , also why should your daughter be the lucky one to not have to pay for your care ,

you want to make all other tax payers pick up the bill if needed for you care , :mad::mad:

you might have paid every penny for the house your self , but that means nothing ,-- lots of other people do this aswell
if u receive/or have done before-- child tax credits and benifts then you have had money from the state LIKE ALL who have children .


also my gran had to sell her house at a loss(much cheaper ) so she could go to a care home for Alzheimer which isnt cheap and we help with top up payents so she can recive the care she needs

i hope u never need to go to a home for help but dont deprive the rest of us workers just so you can give your daughter SOMETHING THAT DOSNT BELONG TO HER

this might sound harsh but better to hear this that to be done for fraud. depravation of assets which will happen

lindsloo

I'm not usually one to !!!!! but slogging my guts out for the NHS this thread has irritated me.

OP you may not plan on getting ill but the vast majority of patients in hospital are elderly and many block beds waiting for an available space in a state residential/nursing home because they are unsafe at home. Thus preventing an acutely ill patient from taking an available bed, you would be happy with this just so your daughters inheritance is protected.

These resources are already stretched to the limit, not operating efficiently and you would be happy to stretch them further out of selfishness.

Your attitude leaves a bad taste. It's attitudes like this, that residents in this country are owed something from the government that this country is in the position it is. Have some pride and support yourself! The state owes you nothing.

geoffky

I bet you slag people who are on benefits ...Or when asylum seekers get some help?
Well your morals are ten times worse and you lack class..
I detest people like you..I bet you judge others but not your own morals..

wannahouse

rather harsh replies here!!!

they most likely are a very nice mum and dad like most of us have, that thought there was a legal way to set it up to protect their assets, and not trying to be dodgy and dishonest, and just asking a question!
unlike the rich, who do this thing every day, they probably don't have loads to spend on proper advice, so asked here.
they most likely had not thought of alot of the other reasons on why this can't be done, i hadn't until i read them, so i think some of the attitudes are rather unfair.

pmlindyloo

wannahouse wrote: »

rather harsh replies here!!!

they most likely are a very nice mum and dad like most of us have, that thought there was a legal way to set it up to protect their assets, and not trying to be dodgy and dishonest, and just asking a question!
unlike the rich, who do this thing every day, they probably don't have loads to spend on proper advice, so asked here.
they most likely had not thought of alot of the other reasons on why this can't be done, i hadn't until i read them, so i think some of the attitudes are rather unfair.

Absolutely agree! Totally uncalled for especially on a forum that is not meant to be judgemental.

OP, you need some professional advice about how your assets can be distributed.

This involves good planning as regards wills and trusts.

geoffky

pmlindyloo wrote: »

Absolutely agree! Totally uncalled for especially on a forum that is not meant to be judgemental.

OP, you need some professional advice about how your assets can be distributed.

This involves good planning as regards wills and trusts.

Here is why....


We have both worked hard all our life and don't see why our daughter's inheritence should go to pay for our care if required

holly_hobby

pmlindyloo wrote: »

Absolutely agree! Totally uncalled for especially on a forum that is not meant to be judgemental.

OP, you need some professional advice about how your assets can be distributed.

This involves good planning as regards wills and trusts.

A will wouldn't deal with this issue, but may assist in any IHT estate planning.

Trust - yes possible (if mge free)

HOWEVER ....... we are back to motivation ..... IF the LA can prove the OPs motivation for this exercise was to deliberately deprive themselves of assets to avoid self funding of LTC fees, the LA can effectively reverse the tsf under DOA regs.

If the OPs entry into LTC was within 6 mths of the event and deliberate deprevation proven, the reversal would be done so under the NHS and Community Care Act 1990.

If entry into LTC occured in excess of 6 mths passing, the LA is unable to utilise the above Act in any DOA case, BUT instead they will take the investigation along insolvency investigation practices (ie investigation into finances, pattern, motivation, etc, etc) - either way if they smell a rat (or even the faint whiff !), be sure they'll dig and it won't matter how its been wrapped for view, if DOA is proven the transaction will be effectively reversed.

I can appreciate where the OP is coming from, and I'm not passing judgement either way, but the important thing for them is to be aware how this exercise could backfire, and the other associated financial issues it may bring.

Hope this helps

Holly