Buying my Grandmas House!!

danswx

Hi All,

Not sure if this is the right place to list this but I need some advice, my gran is soon to be going into 24 hour care, she doesn’t have any saving and she owns her own house, it's probably worth about £80K, if she sells it the Government will take her money and take £500 out each week to pay for the care. I was wondering if there was anyway that I could buy her house for lower market value!! Is this at all possible?? What would be the minimum I would have to buy it off her for??

If you don’t know please leave advice on where I could find out!

Thanks very much,

Dan

nearlyrich

If your gran sells the house for less than market value to avoid care fees the fees will still need paying and the person who benefits from the transaction will be liable to pay.

SquatNow

Surely her house was her pension? To pay for her in her old age?

Or at least that's what all the old people have been saying for the last 10-20 years. Why have they all suddenly changed their minds when it came time to sell?

merlinthehappypig

nearlyrich wrote: »

If your gran sells the house for less than market value to avoid care fees the fees will still need paying and the person who benefits from the transaction will be liable to pay.

Is this still the case even if she sells it at full market value?

A_Nice_Englishman

Perhaps the OP's family could avoid the problem by providing the care themselves either in Gran's home or by having her move in with one of them?

SquatNow

If it's £500 a week then she'll be need high-dependancy care.... specialist staff and equipment.

SquatNow

chriseast wrote: »

Is this still the case even if she sells it at full market value?

No then she'll have to pay the fees out of her saving... the proceeds of the sale of her house.

AFAIK: If she sells it at reduced value then the children don't have to pay for her care but they will be liable for Capital gains tax on the difference between market value and what they pay, less their annual gift allowance, and if she dies within a certain period even the "gift" amount would be taxable under IHT... AFAIK. Any tax experts handy?

Either way selling it to her children at a discount to avoid having to pay for her care is very un-public-spirited, verging on dishonesty.

merlinthehappypig

A_Nice_Englishman wrote: »

Perhaps the OP's family could avoid the problem by providing the care themselves either in Gran's home or by having her move in with one of them?

The moving in bit is what we have decided upon, but, despite saving the Government loads of potential care costs, there still seem to be fairly stringent tax liabilities on the proceeds from the sale of their house if we combine both our equities to buy a house big enough for two families, as well as other potential liabilities if they eventually have no choice, but to go in to care.

A_Nice_Englishman

chriseast wrote: »

The moving in bit is what we have decided upon, but, despite saving the Government loads of potential care costs, there still seem to be fairly stringent tax liabilities on the proceeds from the sale of their house if we combine both our equities to buy a house big enough for two families, as well as other potential liabilities if they eventually have no choice, but to go in to care.

I didn't think there was any tax liability when you sold your own house?

Presumably the tax liability arises on the "Gran's" death, when her share of the larger property is passed to you (or whoever she leaves it to)?

Is a charge put on the property if she goes into care?

poppy10_2

If she sells below market value, the government will expect you as the buyer to make up the shortfall - you will still be liable for care home fees up to the full market value of the property.

emeraldbugle

If your Gran sells her house, this is her main residence, so there should be no capital gains tax to pay. The '80k' that she receives would pay for her care, on her death there wouldn't be any inheritance tax to pay, as it is below the threshold. You could just get a power of attorney to manage her account (with the 80k in) for her.

I just don't think it would be liable to tax. Maybe I am missing something.