Paying for my dad's care home. Will the council expect me to pay as I have retired ?

atush

This is all starting to turn into a nightmare from something that seemed so simple.

There are no documents. Dads pensions and allowances brought in around £1000 a month. That money went into the family pot of living expenses and to look after him, which totaled was around £2000 a month. Dad wanted for nothing as anything he needed he got including days out and weekends away which was never cheap. So to answer your question I would say his money from the sale remains untouched by living expenses.

Please, stop being head blind. Sit down calm down and write it all up?

How many people live int he house? start by splitting everything by that number, but you can add extra for heat as he is home all day, and room if he has hos own bathroom etc. Compare this with adverts in local papers about renting rooms in a house. You could most likely choose the higher figure.

You know every place he has been, and can work out costs. Every thing he wants he gets? Work it out?

Sure you wont get it all at first, but you start writing it down, and review with your OH and your father? He will start remembering stuff you forgot as he wants you to have as much money as you deserve/he spent?

Eventually you will come to a figure.

Mojisola

Don't worry about inheritance tax unless your parents' estates are over £650,000.

atush

No none of the money has been spent but it is in my name. That now poses another question. If dad now died would that money now be viewed as a gift with inheritance tax due or would his Will override the gift, not that it was his intention that it was a gift but a legacy from mum.

The question I pose is , is your father a non tax payer and you a taxpayer? Have you been paying tax in his money? This might need to be transferred back to you (documented if you put money back in his name?

Anyway, work out what it cost to move him in with you, and all his costs since he moved in. Even driving him places, that is a cost.

And Mojisola and I cross posted, but if the total inheritance is below the threshold, dont worry about IHT.

Poppie68

When you work out the amount of rent etc to deduct don't forget to also include the £1000 a month he has been contributing already, as the figures will be checked.

atush

Yes of course. that was implied. But there is all the driving here and there and other intangibles that have a price. Add them all up. XP per mile, or local taxi fares?

Things you'd forget like TV license, etc. Sat tv? everything.

jamesd

smjxm09 wrote: »

The Wills were just simple affairs, the house was in joint names but I was left a lump sum. As the years past the lump sum was spent which was never a problem. The lump sum was then financed by the sale of the house as I was the sole beneficiary of mums Will.

OK. What really happened legally and for care funding purposes at that time is this:

1. At the moment your mother died your dad became the sole owner of the house because they were joint tenants. Her will did not and cannot in law have any effect on this.
2. Your father chose to give you the lump sum money from the sale of his house. This is a potential deprivation of assets issue because the money was his and he disposed of it to you.

smjxm09 wrote: »

I left a well paid job at Christmas as there was not a hint of what lay ahead. If I knew what was going to happen I would have stayed at work.

That is also something that would also be evidence tending to support the lack of an expectation that he would need care.

You are going to need to tell the council that he gave the proceeds of the sale of his house to you but his health and lack of known need for care should keep them off your and his back.

As ognum mentioned, the money from him to you is also a "potentially exempt transfer" for inheritance tax purposes. If he dies more than 7 years after giving it to you you keep it all, otherwise some of it will be taxable for inheritance tax purposes. There are two inheritance tax exempt amounts available for a total of £650,000 free of inheritance tax, assuming that none of your mother's own allowance was used. Some might have been if she had any money solely in her own name. It makes no difference at all that he intended it to be from your mum, in law it wasn't, at least not the part covered by the house, some lower amount could have been.

The council may well want a break down of how much was in her sole name and how much was in joint accounts/ownership and passed to him directly. Best to start gathering the records to prove this now while it's still relatively recent and available.

smjxm09 wrote: »

£15000 was just a figure, it could have easily have been £50,000. The thinking behind £15,000 was to avoid probate

This hasn't gone through probate? Just as well he inherited the house directly via joint ownership because if he hadn't, probate would have been a mandatory legal requirement. Did she really have assets worth less than £15,000 in her own sole name? No single name savings accounts or money held in ISA or Premium Bonds that together add up to more than £15,000? All joint savings accounts would have passed to him automatically. I'm worried that her estate may have been worth more than £15,000 and that the law may have been broken by not going through probate for her estate, even though the house wasn't a factor.

Just so you know, probate is going to be mandatory if he dies within seven years of giving you most of the proceeds of the house sale, by law, so don't try to dodge it.

If inheritance tax could have been a factor for his estate, the £650,000 exempt amount could be expected to provide around £26,000 income increasing with inflation for many decades or several times that without substantial deletion during the two to three years that people typically spend in care before death. If that sort of amount is really involved here it probably wouldn't even be necessary to try to avoid care costs because the money would have been sufficient anyway.

Good luck with the council. Given his health I'm fairly optimistic but do be sure to tell them the full facts and not try to shade it in any way, they will cross-check with the Land Registry and banks and it would harm your case for them to find that you misled them in any way.

As atush wrote, carer's allowance income for you may well be available and you should claim that if eligible because it's there in part to save everyone money by reducing the need for more expensive care housing.

It's also worth asking how much money is involved? If it really is in the sort of amount that could matter for inheritance tax it'll be pretty easy to work out how to fund his care using investments, without the potential for huge drops in value.

Try not to be worried by what we're writing. I don't doubt that your intentions are and were fine and don't think that you are likely to have any huge unexpected bills. It's just trying to be sure that you know the correct legal situation and which arguments you need to rely on with the council and possibly others, so you don't get screwed up by not knowing and following the relevant laws and rules.

System

jamesd wrote: »

1. At the moment your mother died your dad became the sole owner of the house because they were joint tenants. .

Has that been established?
The house was "in joint names". That does not necessarily mean "joint tenants".

jamesd

I agree that it's possible that the words "joint names" does not necessarily mean that the ownership was as "joint tenants" rather than "tenants in common". It would be useful for smjxm09 to be explicit about which of those two it was, since the difference is very substantial.