Transferring money to spouse when LPA is about to be issued

alikat55

My husband is about to make an LPA because of early onset dementia and I was wondering about the legal situation in respect of finances should the LPA be activated and his finances need to be used to contribute towards paying for him to go into a care home.

Currently we have joint bank accounts, we each have our own ISAs (for about the same amount each) and he has a small company pension. I also have my own bank account where there are currently very limited funds. His total funds currently exceed the top limit for any care home funding assistance from the local authority.

It strikes me that this is not ideal if his overall income is going to be taken into account in what I might be assessed as having to pay for the care home expenses, should they ever arise.

Can anyone please advise if it is legally possible for him to transfer some of his funds to me without this coming under "deprivation of assets"? And would this need to be done before the LPA is taken out when he is still capable of mind?

Detroit

I don't believe it is possible. The law is very clear in that you cannot deprive yourself of assets in order to avoid care home fees. Intent is important in the decision on this, and to take this step now would mean the intent was very transparent.

Not all his money would be taken into account, I believe the first £14k or so is ignored. There is another threshold up to around £24k when some help is given with fees.
Over this I believe he would completely self fund.

The Age UK website has some very useful information on this subject.

If you haven't already done so, I would advise you explore the non means tested benefits your husband may be entitled to, PIP, or Attendance Allowance depending on his age.

https://www.turn2us.org.uk is a good starting point, as is CAB or Age UK.

alikat55

Thanks for your answer, Detroit.

Would it still be considered deprivation of assets even though, at the moment, we obviously have no idea whether a care home will be required at any stage in the future, as he is currently only 61 years old?

Detroit

alikat55 wrote: »

Thanks for your answer, Detroit.

Would it still be considered deprivation of assets even though, at the moment, we obviously have no idea whether a care home will be required at any stage in the future, as he is currently only 61 years old?

I think it would, because, to be blunt, it is.

You have not given any other reason why you would make this transfer, other than to avoid care home fees.

To have any chance of successfully challenging a D of C/A decision, you would need to have at least a credible alternative reason for the disposal of the money and/or the arguement that you had no reason to believe care would be required. Even in this case, the case would be weak.

Given that your only motive is to avoid the fees, and your husband's diagnosis does indicate a future care need, which your actions in respect of LPA give weight to, I believe you would struggle to make a case at all.

People have for years tried to find ways around the rules. Policy makers are generally one step ahead and have tightened the potential loopholes.
If it was as simple as putting your money into your spouses account, very few people would pay for their care.

However, please do not take my word for it, get professional advice from Age UK or CAB.

alikat55

Detroit wrote: »

I think it would, because, to be blunt, it is.

You have not given any other reason why you would make this transfer, other than to avoid care home fees.

To have any chance of successfully challenging a D of C/A decision, you would need to have at least a credible alternative reason for the disposal of the money and/or the arguement that you had no reason to believe care would be required. Even in this case, the case would be weak.

Given that your only motive is to avoid the fees, and your husband's diagnosis does indicate a future care need, which your actions in respect of LPA give weight to, I believe you would struggle to make a case at all.

People have for years tried to find ways around the rules. Policy makers are generally one step ahead and have tightened the potential loopholes.
If it was as simple as putting your money into your spouses account, very few people would pay for their care.

However, please do not take my word for it, get professional advice from Age UK or CAB.

Thanks again, Detroit and I will get professional advice as you suggest.

I would just say that he hasn't worked for a few years, but I have always allocated my earnings equally between our various ISAs (and, of course, the income in our joint bank account has come mainly from me - apart from his pension for the last year), so it could be considered a way of offsetting this, as, otherwise, my ISAs would have much more in them than his. I wonder whether this would possibly be a consideration for not counting this as deprivation of assets.

Detroit

The calculation would assume that 50% of any money in a joint account belonged to your husband, and all his personal assets belonged to him too.

As far as Im aware there is no discretion as to where either the joint or personal money came from.

However, there is the possibility to challenge if the amount taken from your partner would leave you in hardship. Though the threshold for this would be quite low.

I believe however that from 2020 the capital limit over which no help is given is set to increase significantly to around £118k. So if your husband is not in imminent need of care you may find the system more generous if/when the time comes.

troubleinparadise

If there is a possibility in the future that your husband might need funding by the Local Authority to provide care for him whether in his home or a care home setting, there is no time limit on how far back the LA might go in doing a financial assessment of his affairs.

So bear that in mind whatever actions you take as the attorney for your husband, or he actions before the LPA is registered. Don't underestimate that all methods of moving funds elsewhere will be known about.

It may be that the LA does not look very far back; it may be that the rules on funding and thresholds changes in the future; it may be that due to circumstances changing that your husband never needs LA funding.

But rather than risk not being awarded that funding, it is better to keep within the rules.

He has a diagnosis of dementia, and that invariably means that care of one form or another will be needed in the future; although the "when" is not known, the "if" doesn't come into it, I'm afraid.

Best to take advice rather than fall foul of the rules, however unfair they may seem.

The Alzheimer's Society website has a lot of good information, and a very active and supportive Forum, "Talking Point":

http://forum.alzheimers.org.uk/forum.php

Keep_pedalling

Others have already covered the DoA issue, but there are other things you need to consider. At the moment it sounds like he still has the mental capacity to make decisions. Once this is no longer the case then you will be very restricted in what you can do as his attorney because everything you do must be in his best interests, so things like transfer of assets should be off limits.

If you are to be his sole attorney make sure the LPA has at least one back-up attorney in case anything happens to you. You should also put one in place for yourself as well, and you should also make sure you both have up to date wills in place, and if you own your house as joint tenants, it would be wise to move to tenants in common, which would prevent the entire equity in the house be eaten up with care costs should you pre- decease your husband.

Savvy_Sue

Because half the money in the joint accounts is 'yours', I would certainly check whether splitting that NOW would be looked at in the same way as moving nearly all of it into a sole account in your name.

But get advice ...

redpete

alikat55 wrote: »

Would it still be considered deprivation of assets even though, at the moment, we obviously have no idea whether a care home will be required at any stage in the future, as he is currently only 61 years old?

You think the possibility is likely enough to be considering moving money around, I think that anyone else would be likely to assume the same motive.

jackyann

Good advice above. It would also now, make sense, to make sure that your own money is in your own bank account.

I wish you luck, this is a very young age to be dealing with such a cruel disease. Do make sure that you know the rules around what should be NHS funded, and what is "personal care".