Mum helping to pay off mortgage

cavework

Sorry if this is a daft question but here goes..
Mum 89 lives with us rent free, she has savings and wants to help us pay off the mortgage with a lump sum which would be also funded by us.
Would this cause any problems?
ie deprivation of assets
tax implications
future care?

asparagus1968

What do you mean by she will pay a lump sum,also funded by you?

cavework

Sorry .. what I mean is Mum will pay a lump sum and we will also pay a lump sum to clear the outstanding mortgage

Mojisola

cavework wrote: »

Sorry if this is a daft question but here goes..
Mum 89 lives with us rent free, she has savings and wants to help us pay off the mortgage with a lump sum which would be also funded by us.
Would this cause any problems?
ie deprivation of assets
tax implications
future care?

How long has she been living with rent free? She could give you a lump sum as a contribution towards the household costs - like adult children paying keep.

If she just gives you a lump sum which significantly reduces her capital (rather than using her money to pay her way in the household), there may be questions about deprivation of assets if she needs care or means tested benefits.

cavework

2 years rent free.. Her contribution would be quite a hefty lump sum from her savings, 30k and I don't really want to do this but she would rather stay with us where we live than move somewhere else with us IYSWIM.
She refuses point blank to move into residential care and I can understand why.
We are happy for her to continue living with us
So we are looking at all options
We have to make the decision to stay or move by next Nov

cavework

To Add.. our original plans before Mum moved in were an interest only mortgage until OH retired, (which he has this year) I have more than 10 years to go before I retire
We would sell and rent for a while .
We would put the equity from the sale in the bank, invest etc and I would continue earning from my business for maybe another 10 years
Now with the change of circumstances I still feel our original plan is the best but I just have to convince my Mum.
x

Mojisola

cavework wrote: »

2 years rent free.. Her contribution would be quite a hefty lump sum from her savings, 30k and I don't really want to do this but she would rather stay with us where we live than move somewhere else with us IYSWIM.
So we are looking at all options
We have to make the decision to stay or move by next Nov

Sounds very reasonable. The important point with deprivation of capital is that it has to be shown that the money was given away in order to be entitled to benefits. Your mother has a very good reason for contributing to the household - she wants to stay where she lives now.

cavework

Thank you
You really have put my mind at rest.
xx