Parents putting house in our names

BigAunty

Does anyone know if a local authority has actually mounted serious legal action against adult children who have had properties transferred into their name to avoid care home fees? I got the impression from the Age UK website that councils have taken limited action but that it looked like they were getting more assertive.

What can a local authority actually do when the capital has been transferred? Are they quite toothless or can they/do they actually sue the recipient, for example?

AdrianC

gillykms wrote: »

Thanks again for the replies. I am not trying to cheat any system just doing what my parents want to do

If you pause and reflect on the situation for amoment, that's EXACTLY what you/they are trying to do.

If somebody has assets of more than a relatively small amount, they have to pay for any residential care they need. That is the law. If somebody deliberately disguises their assets by transferring them to somebody else, so the taxpayer will pay for their care instead, how is that not "cheating the system"?

Mojisola

Other posters on MSE have said that, in their areas, the residential homes that charge LA rates are as good as ones where the fees are higher.

Around here, that isn't the case. I visited the only home in our town that the LA rates would cover and there's no way I would have let my Dad live there. I was grateful that we had the money from his house to pay the higher fees at a better home.

I would always suggest that people who want to give their money away to avoid care home fees visit a range of homes first and see where they would prefer to spend their last years.

mrginge

AdrianC wrote: »

If you pause and reflect on the situation for amoment, that's EXACTLY what you/they are trying to do.

If somebody has assets of more than a relatively small amount, they have to pay for any residential care they need. That is the law. If somebody deliberately disguises their assets by transferring them to somebody else, so the taxpayer will pay for their care instead, how is that not "cheating the system"?

I wonder how these people feel about amazon, starbucks, facebook etc and their tax avoidance methods.

It's very difficult to be morally outraged about large organisations that are legally reducing their tax liabilities while at the same time trying to look for ways to do the same.

AdrianC

mrginge wrote: »

I wonder how these people feel about amazon, starbucks, facebook etc and their tax avoidance methods.

It's very difficult to be morally outraged about large organisations that are legally reducing their tax liabilities while at the same time trying to look for ways to do the same.

Except, of course, this thread is not talking about any legal reduction of tax liabilities, but an illegal way to receive money from the government which isn't due.

A better analogy would be with benefit fraudsters.

gillykms

To be quite honest my mum and dad wouldn't have a clue what Amazon, Starbucks or Facebook are.

Perhaps I should rephrase what I said. I was not aware that this plan that has been advised by their solicitor was cheating the system. My mum simply wants to ensure that her home doesn't get 'taken off her' (in her words) and that my brother's not legally ex-wife doesn't get her mitts on any of my brothers inheritance.

Booksurr - it was the solicitor who advised us not to put the money in trust and that its best to work it out between ourselves. I think its something to do with the fact that we would want my brother to be given a monthly amount rather than a lump sum.

It seems I have opened a can of worms with this one. I do think I should tell them we should chat to a different solicitor or perhaps a financial advisor.

trollopscarletwoman

I know a couple who sold their house, rented close to relatives, spread the money about, then about 8 years later one dies and the other went into care.

Seemed to work for them.

I wouldn't know if that is illegal or not. I do remember there being talk of a '5 year rule.'

Zither

I've heard a lot about people putting their parents' house(s) into trusts - how does this fit with this situation?

troubleinparadise

Zither wrote: »

I've heard a lot about people putting their parents' house(s) into trusts - how does this fit with this situation?

This article explains a little of the idea of such trusts, plus their pitfalls, and offers other solutions:

http://www.telegraph.co.uk/finance/personalfinance/insurance/longtermcare/10117822/Warning-over-care-home-trust-schemes-that-promise-to-protect-your-property.html

And the Inheritance Tax implications (although of course that only applies should the IHT threshold be exceeded):

http://www.hmrc.gov.uk/trusts/iht/transfers-in.htm

People, whilst wisely looking to the future and sensibly making plans, often worry about this issue too much - not everyone needs care in their later life, and a Bupa report (link below) found that the average stay in a care home was a little over 2 years (832 days) - but of course that will not apply to all. The current legislation with regard to self-funding thresholds may also change rendering certain actions disadvantageous in the future - but who knows?

http://www.pssru.ac.uk/pdf/dp2769.pdf

My mother was in residential nursing care at the end of her life - I viewed her savings as her "rainy day fund", not as my inheritance - and this situation was that rainy day. My parents worked to support themselves and saved for their later years, and as it turned out I was then able to make a choice of a lovely home with high standards of care using that. I would far rather she had been well enough to blow it all on cruises and high living, but it meant that a sad situation was as good as it could be as a result.

missbiggles1

gillykms wrote: »

To be quite honest my mum and dad wouldn't have a clue what Amazon, Starbucks or Facebook are.

Perhaps I should rephrase what I said. I was not aware that this plan that has been advised by their solicitor was cheating the system. My mum simply wants to ensure that her home doesn't get 'taken off her' (in her words) and that my brother's not legally ex-wife doesn't get her mitts on any of my brothers inheritance.

Booksurr - it was the solicitor who advised us not to put the money in trust and that its best to work it out between ourselves. I think its something to do with the fact that we would want my brother to be given a monthly amount rather than a lump sum.

It seems I have opened a can of worms with this one. I do think I should tell them we should chat to a different solicitor or perhaps a financial advisor.

And yet, taking her home off her is exactly what you're trying to do!