Being paid by parent.

shezza2

Hi all, If I were to look after my elderly father could he give me a set amount each week for doing so, and would I have to pay tax or would he or myself have to declare anything.

Alias_Omega

Prepare to the flamed...


LoL!

freebiequennie

I am not sure but yes it's an income and you have to declare it for tax purposes.

I know for childcare grandparents can not be legally paid to care for grandchildren unless a registered childminder n also care for other children.

Elderly Cate isn't registered in the same way so I suppose your dad could pay you if it means you cannot take paid work but you need to declare that income

If you are on benefits speak to an advisor about benefits entitlements for being a carer.

RedFraggle

He can gift you 3k a year tax free.

mountainofdebt

Alias_Omega wrote: »

Prepare to the flamed...


LoL!

Whilst I have no doubt the 'oh they brought me up and now it my turn to look after them' posters will be out in force, actually I can see the praticalities of such an arrangement, especially if the carer had to give up / reduce hrs in paid employment

Robisere

Is he over 64? if not, check out what he is entitled to:

https://www.gov.uk/pip/overview

If he is 65+, you can get good, impartial advice here:
http://www.ageuk.org.uk/

You can trust Age UK, all personnel are vetted. I live in Sheltered Housing as one of the youngest at 69, there are people here in 80's and 90's who use ageuk services, everything from cleaning and gardening to shopping. If you prefer to do it yourself I understand, but use them for advice. They will send someone to talk to you and your father.

More than 25 years ago, I looked after my parents, then over 80 and both quite ill, until they passed away. I would have appreciated some organisation such as ageuk to help. I was also working full time as a workshop foreman, I was exhausted for a year and would not like to see anyone else in that situation.

I wish you good luck and I don't mean to say that you should do this as a duty because dad looked after you: in my day that is how it was, nowadays life and care have moved on.

meritaten

I would ask on the Disabilities and Dosh board. they are far more knowledgable on these matters. in my opinion from what you say - he may be entitled to Attendance Allowance and you Carers Allowance. if he can afford to pay you out of his own income then depending on how much and whether you have other income you MAY be liable for tax (but I doubt that).

Tuesday_Tenor

RedFraggle wrote: »

He can gift you 3k a year tax free.

This is misleading.

Your father can gift you as much as he wants, whether regularly or as a one-off. You as the recipient do not need to pay income tax on gifted money.

The £3000 a year issue only comes into play as follows, and may or may not be an issue for this family:
When your father eventually dies, any gifts over £3000 p.a. made during the previous 7 years will have to be declared on the Inheritance Tax form, and they will still be regarded as part of his estate, i.e., as if he still had that money. If, and only if, his total estate is over £325,000, then the estate will need to pay inheritance tax on the element over 325K.

If Dad's total estate (including such gifts) is less than £325K , then there will be no IHT to pay. The executor will need to declare any such gifts, but they will not result in any tax implications.

I gave up professional work to support my elderly parents, on the strength of savings I already had to tide me through such circumstances for up to 3 years. What happened in practice was that my parents gave me generous gifts from time to time in the last years of their lives. The main ones were declared on the IHT forms, but as their estate was well below the threshold, there were no tax implications.

If you require regular gifting from your father in order to live, and he is willing to do this, then there is nothing to stop you.

Just a couple of final points.

If you do this as gifted money, think about whether you need to pay voluntary N.I. contributions to safeguard your state pension.

You father MAY prefer to set up a formal employment contract so that the terms of what his carer does are clearly laid out. That would clearly be employment, with totally different tax implications.

Tuesday_Tenor

freebiequennie wrote: »

.....but yes it's an income and you have to declare it for tax purposes.

This is also misleading.
A GIFT is NOT classed as income by HMRC.
You may have to declare it, but if you declare it as a GIFT, then there are no income tax implications.
(Actually I don't think you do have to declare gifts, but may be corrected on this).

To OP, the downside of the gifting arrangement , of course, is that it is entirely voluntary on you dad's part. He could stop or reduce his gifting arrangements at any time. You may have worked very hard for him for 3 weeks / 3 months but if he fails to gift you you have no recourse to claim anything, whereas with a formal employment contract, both sides need to keep to the terms and conditions agreed.

GwylimT

Depending on your working years you may need to buy some stamp. I hope everything goes well, when my gran couldn't look after herself very well I couldn't afford to give up work, but we were lucky as we were able to move in with her to help her with everything she needed.

Have a look at day centres etc for when you need a break.

Alias_Omega

Alias_Omega wrote: »

Prepare to the flamed...

LoL!

Phew...and were safe... Something must be up with MSE recently, as I anticipated a several page rant about how the roles should be reversed for free.


On the other side, if you are going to be paid to assist, ensure you have the simple things that you might miss such as Car Business Insurance.

Mrs AO is going into something similar, not a family member though. The self employed tax return, business insurance, liability insurance etc is all things that need to be asked about.