Will it look like my nan is avoiding paying for care costs.. Advice needed. Pls !!

Edhoward

:)Hi
Would really appreciate some advice.

My nan moved closer to the family after my grandad died. She has now lived close by for the last ten years. So she sold her home and due to my grandad doing everything with regards to sorting out bills she transfered the house into my dad's name (her son) as she couldn't cope with sorting bills etc out as she never had to. she's was an independent lady in other aspects who for the last ten years or so cooked and cleaned for herself no problem. Until last year when my Dad passed away from cancer. Real bad time for all of us especially my nan as he was her only child. .. now 86 she has in the last year suffered from constant falls. Finding things difficult with getting up the stairs and now very recently a stroke. Which has now left her paralysed. It now looks like she may need to go into a care home.
Now this is the part which we need advice on. ....when my dad was in his last week's of life he left everything to his wife my stepmum In the will including my nans home. With the intention on passing the house over to me and my brother when my nan passes away. But recently my stepmum has been advised to transfer the house to both of us sooner... My question is, if we were getting my nan financially assessed for care funding to going into a home can they look into the house and will it look like she transfered it to my dad to avoid paying for care. I've read so much on the Internet. But I'm a complex case. Any advice would be great. Xxx

Yorkshireman99

Edhoward wrote: »

:)Hi
Would really appreciate some advice.

My nan moved closer to the family after my grandad died. She has now lived close by for the last ten years. So she sold her home and due to my grandad doing everything with regards to sorting out bills she transfered the house into my dad's name (her son) as she couldn't cope with sorting bills etc out as she never had to. she's was an independent lady in other aspects who for the last ten years or so cooked and cleaned for herself no problem. Until last year when my Dad passed away from cancer. Real bad time for all of us especially my nan as he was her only child. .. now 86 she has in the last year suffered from constant falls. Finding things difficult with getting up the stairs and now very recently a stroke. Which has now left her paralysed. It now looks like she may need to go into a care home.
Now this is the part which we need advice on. ....when my dad was in his last week's of life he left everything to his wife my stepmum In the will including my nans home. With the intention on passing the house over to me and my brother when my nan passes away. But recently my stepmum has been advised to transfer the house to both of us sooner... My question is, if we were getting my nan financially assessed for care funding to going into a home can they look into the house and will it look like she transfered it to my dad to avoid paying for care. I've read so much on the Internet. But I'm a complex case. Any advice would be great. Xxx

It would almost certainly be regarded as deprivation of assets. You should all get som professional advice. It could very messy.

securityguy

On the face of it, there's a reasonable justification that this isn't deprivation of assets. The key transaction is the first one: "she transfered the house into my dad's name (her son) as she couldn't cope with sorting bills etc out as she never had to. she's was an independent lady in other aspects who for the last ten years or so cooked and cleaned for herself no problem". That's a pretty key "ten years": for it to be deprivation of assets there needs to be an immediate or imminent prospect of care home fees ("being old" not being enough) and the transaction has to have no legitimate purpose other than avoidance. At first sight, neither test is met. Care home fees weren't imminent, as this was ten years ago. And although a purist might argue that a PoA would have been more appropriate, the transaction isn't obviously artificial.

The transaction is almost certainly a "gift with reservation" for the purposes of IHT (she presumably wasn't paying rent), but that's not relevant here.

As Yorkshireman says, you need advice. He knows more about this than me, but I don't think that what your dad did or didn't do with the property subsequently is relevant. He isn't going into care, after all, and the deprivation of assets issue with respect to your stepmother gifting the house to you would apply if/when she needed care (is her health currently failing?).

Keep_pedalling

An LPA would certainly have been the appropriate thing to do in this case, so I think the LA would certainly have a reasonable case of claiming DoA. Giving it away 10 years ago might help if that is the case, the OP only said she moved 10 years ago, the time scale regards the transfer was not mentioned.

I assume the advice is to transfer ownership again is because your step mother's estate is now well above the nil rate band, and is to potentially reduce the eventual IHT, but I would not act on that until the issue of your mans care has been resolved.

The upside for your nan if she does have to self fund is that she will have a lot more options in choosing which care home she ends up in. My mum who went into care a couple of weeks ago did so after a hospital stay and being a LA tenant with few savings had little choice which home she was allocated to. Luckily she is happy there, but that might not have been the case, and if it had been me I would have wanted a something a bit more luxurious, which is why our house will never get transferred to our children.

Yorkshireman99

Keep_pedalling wrote: »

An LPA would certainly have been the appropriate thing to do in this case, so I think the LA would certainly have a reasonable case of claiming DoA. Giving it away 10 years ago might help if that is the case, the OP only said she moved 10 years ago, the time scale regards the transfer was not mentioned.

I assume the advice is to transfer ownership again is because your step mother's estate is now well above the nil rate band, and is to potentially reduce the eventual IHT, but I would not act on that until the issue of your mans care has been resolved.

The upside for your nan if she does have to self fund is that she will have a lot more options in choosing which care home she ends up in. My mum who went into care a couple of weeks ago did so after a hospital stay and being a LA tenant with few savings had little choice which home she was allocated to. Luckily she is happy there, but that might not have been the case, and if it had been me I would have wanted a something a bit more luxurious, which is why our house will never get transferred to our children.

From what the OP said his nan did not lack mental capacity so i don't think a LPOA would be appropriate. Local authorities are increasingly hard nosed on DoA but as you say professional advice is needed. Depending on the size of the estates IHT may be an issue as well. Not a DIY job.

securityguy

"From what the OP said his nan did not lack mental capacity so i don't think a LPOA would be appropriate."

Well, someone who "couldn't cope with sorting bills etc" would be a candidate of a POA, L or otherwise. There's no reason why that couldn't be an LPOA if everyone agreed: so long as the donor retains capacity it's effectively a POA and they can rescind or change it, but on incapacity it retains effectiveness. The alternative is to draw up a POA and an LPOA for later, which seems overly complex and potentially expensive. If there were only a POA there's a risk you'd end up not getting an LPOA while the donor retains capacity, and a trip to the court of protection is never cheap. I think if my elderly relative were unable to deal with their finances but retained decision-making capacity I'd advise them to look at an LPOA: why would a POA be better?

Keep_pedalling

Yorkshireman99 wrote: »

From what the OP said his nan did not lack mental capacity so i don't think a LPOA would be appropriate. Local authorities are increasingly hard nosed on DoA but as you say professional advice is needed. Depending on the size of the estates IHT may be an issue as well. Not a DIY job.

You do not need to lack mental capacity to use a LPA, my mum is exactly the same as the OPs nan. Although I now do everything financial for her, when we first set it up I was stil using it to do some things for her such as on line banking, and getting her shopping if she was not well.

That is the big difference between a LPA and the enduring POA it replaced.

jackyann

OP - I would certainly get advice, best people might be Age UK or a similar charity near to you. You could also try CAB. You will probably have to pay for a solicitor, but they will recommend someone with good knowledge of the system.

The thread seems to have become about whether a LPA would have been better - and that boat has sailed. From my limited experience, I would agree with securityguy that the 10 years of independent living is key.

Also, I would argue (from my work experience, not my personal experience) that there were a number of women of that generation who expected men to look after the financial / householding affairs. I have known women do exactly as your nan did, simply so they didn't have to worry about the house.

I think the bit about your stepmum transferring to you & your sibling is separate, and needs separate advice.

missbiggles1

Why can't your stepmother (or you and your brother) just sell the house and use the proceeds to fund your nan's care?

margaretclare

jackyann wrote: »

OP - I would certainly get advice, best people might be Age UK or a similar charity near to you. You could also try CAB. You will probably have to pay for a solicitor, but they will recommend someone with good knowledge of the system.

The thread seems to have become about whether a LPA would have been better - and that boat has sailed. From my limited experience, I would agree with securityguy that the 10 years of independent living is key.

Also, I would argue (from my work experience, not my personal experience) that there were a number of women of that generation who expected men to look after the financial / householding affairs. I have known women do exactly as your nan did, simply so they didn't have to worry about the house.

I think the bit about your stepmum transferring to you & your sibling is separate, and needs separate advice.

Apparently this is common among women of this - MY - generation! It's something I find hard to comprehend, but it is so. Husband dies, then son/daughter is expected to deal with all Mum's finances as 'she never paid a bill in her life'.

I also find it hard to comprehend that this lady was willing to live for 10 years in a house that wasn't in her name. Again, apparently common among my generation - it was all in the man's name. How can she be accused of depriving herself of assets - it has all been done by others, with herself relinquishing control years ago.

Difficulty of getting upstairs - did no one ever think of this before she reached the grand age of mid-80s? Stair-lift for example? There are ways of making a house 'mobility-friendly' for the later years of one's life.

Keep_pedalling

From the original post, I read it that she owned a house, sold it and and bought a new one nearer her family 10 years ago. We don't actually know when she handed her new house over so the period of ownership could well be a lot less than 10 years.