can a disabled person iinherit a house then rent it out for income

Brighty

Tarambor wrote: »

You are falling into the benefits trap and risk doing yourself out of money just in order to maintain a benefits claim for Income Support and Carers Allowance, potentially making the both of you at least £1900 a year worse off and probably more than that. Your carers allowance claim would not be affected if the rental profit was at or below £110 a week which is more than you'd be getting in income support by £37 a week leaving you £1900 a year better off and I find it hard to believe you couldn't do with having an extra £1900. There are expenses which you can offset to maintain that £110 and some of them don't involve you spending as much money as you claim.

However if you live in an area where the property rental is higher, such as the south east, the rental income was more than £137 a week then you'd be better off than being on Carers and IS.

As I said you are falling into the benefits trap by your thinking and basing your entire decision making on maintaining your claims. There are a lot of people in poverty in this country because they do the same, usually trotting out the "but we'd only be working for a quid an hour" as justification because the wage for the job was £40 more than the benefits they were on.

Rental income from an inherited property can be disregarded as earnings for CA, so you can have the rental income plus still earn another £110 a week on top from work.

Brighty

xylophone

Your father should take expert advice from a solicitor experienced in Wills and Trusts concerning any legacy to his grandchild.

You already have the responsibilities of caring for a severely handicapped young adult - would you wish to add the onerous responsibilities of being a Trustee and Landlord to your burdens?

Your father might direct that the property be sold and the proceeds gifted into a discretionary trust - there could be a number of beneficiaries which could include you, your son, any other grandchild etc etc.

Or the discretionary trust might have only one "vulnerable" beneficiary.

http://disabilitytaxguide.org.uk/other-tax-issues/trusts-for-disabled-people/

Presumably you would be one of the Trustees.

You would need to be aware of the tax situation.

https://www.gov.uk/trusts-taxes/trusts-and-income-tax

https://www.gov.uk/trusts-taxes/types-of-trust

teddysmum

If your father is in the unfortunate position of needing residential care in his last years ( surely you couldn't cope with two people with extensive needs), the property may have to support him, so there would be no need to worry about the implications of inheriting it.


My mother-in-law changed her will so my husband's disabled brother would get her house, but she went into care so her house was sold and the money gone, years ago.

Credit-Crunched

glyndwr1999 wrote: »

Ok, thank you for that Johnnie, so am i correbt in thinking a discretionary trust is set asise when being assessed for any benefits he may get.
At the moment he is in college so does not claim anything in his own right yet, but in july he will be out of college and be on employment support allowance.
The main reason for the house not coming to me is that it wold affect my position as a carer and income support claim.

Before you start to take advice from an internet forum, I would suggest professional advice. The taxation of a discretionary trust, is different to that of an absolute trust.

lisyloo

You have no idea in the cost emotionally and monetary in caring for a severely disabled child or young adult that cannot do anything for themselves.

I'm sure you are correct.
Be aware that being a landlord involves a lot of responsibilities and can also be a lot of work and very stressful.
In the normal run of things you'll need to do repairs, checks (such as smoke alarms, carbon dioxide monitors) checkout tenants etc. and deal with all the accounting side of things.
If things go wrong you might have to deal with damage, flea infestations and financial problems. Of course it doesn't always go wrong, but be aware that is does involve quite a lot of obligations, some of which are legally required (this has increased in recent years) and some a very serious life/death issues e.g. carbon monoxide.

In recent years the government have increased responsibilities on landlords for things like money laundering and checking people have a right to be in the country, so the red tape has increased.

Is this something you are in a position to take on given your current responsibilities?


You can outsource some of it - at a cost, but you'll still need to be involved.

glennevis

xylophone said "Your father should take expert advice from a solicitor experienced in Wills and Trusts concerning any legacy to his grandchild."

I would agree and add that the solicitor should be experienced in dealing with trusts for the severely handicapped as well. My mother found one through Mencap.