Cost of Residential Care (Scotland)

booler

Apologies if this has been discussed elsewhere. I haven't been in here for a while. My wife and I live in Scotland. We are in our late 60s. We have made a will basically sharing everything we leave between our daughter and son so that side has been taken care of.

Recently a friend's mother was taken into residential care as she Alzheimer's. They sold her flat and they are now funding the cost of her residential care in a local authority care home from the proceeds. My understanding is that they must pay all of this from her estate apart from the last £20K.

My question is about our own situation. We are currently is reasonably good health but if one or both of us eventually has to go into care is there anything we can do now to minimise the cost of this and the burden on our estate? For example should we be considering the transfer of ownership of the house to our kids?

Catswhiska

Transferring the house can be seen as a way to avoid care costs. One thing you can do is put the house in 'tennants in Common' and each leave you half share to the children. That way if one of you ends up in care then half of the house is exempt from care costs if the other partner dies

Yorkshireman99

The short answer is no. The longer answer is that this will not help as this and most other loopholes have been cloed.

Yorkshireman99

Catswhiska wrote: »

Transferring the house can be seen as a way to avoid care costs. One thing you can do is put the house in 'tennants in Common' and each leave you half share to the children. That way if one of you ends up in care then half of the house is exempt from care costs if the other partner dies

Easier said than done. There are various factors to be considered before doing so. None will give complete protection against care costs. The OP really needs to take advice from a Scottish solcitor as there are different rules on inheritace in Scotland.

Jenniefour

And don't overlook these scenario's either, if Scottish law applies in same/similar way:-

1. If either of your children pre-deceases you their share of your former house would be part of their estate.
2. If one/both your children were to get divorced (if they're married) your former house would be part of the divvying up/financial settlement.

Keep_pedalling

It won't work anyway, but do you really think it fair for tax payers to fund your children's inheritance?

getmore4less

booler wrote: »

For example should we be considering the transfer of ownership of the house to our kids?

not a good ideas.

Catswhiska wrote: »

Transferring the house can be seen as a way to avoid care costs. One thing you can do is put the house in 'tennants in Common' and each leave you half share to the children. That way if one of you ends up in care then half of the house is exempt from care costs if the other partner dies

no TIC in Scotland but there is the equivalent.

Scottish trust law also has the equivalent of an immediate post death interest in possession trust created by the will on first death.

For all practical purposes and taxes that 1/2 house belongs to the spouse EXCEPT for care home fees(and other asset grabs).

proper legal advice is needed to cover all angles but it is a fairly standard approach to protecting 1/2 a property without losing the rights to live in it as if you owned it.