Inheritance Tax/Care Home Fees/Depravation Assets

SpideressUK

Cheeky_Monkey wrote: »

How many bedrooms does your mum's house have?

Could your brother and his family go and live with her in her house?

That was our first consideration but mum's house is even smaller than his current rented house. There are potentially 3 bedrooms but mum will have the only living room converted into "her room" with commode/bed/ tv etc so no living space for my brother and hus family. That is aside from the fsct hus jib is down South and mum's house is 5+ hrs North of him.

Mojisola

SpideressUK wrote: »

Mum has already lived with one child for 7 months now

For the past 7 months she has been paying Council Tax, Insurance etc on a house she is not living in

SpideressUK wrote: »

Yes she is on AA its part of the overall £800 pm ish she gets from pension and the like but my brother just takes all of that for her cost of living care

For seven months, she's been paying £800 a month to your brother and paying out to keep up her old home?

I can understand her not wanting to cost your brother anything but he takes all her income rather than her just pay her share of the household bills - I'm shocked.

SpideressUK

Mojisola wrote: »

For seven months, she's been paying £800 a month to your brother and paying out to keep up her old home?

I can understand her not wanting to cost your brother anything but he takes all her income rather than her just pay her share of the household bills - I'm shocked.

Yes, I was a little surprised too but since it was to be short term and it was our only real option and best for her mental health wise I let it go.

troubleinparadise

This is going to sound harsh, but reading all this it sounds like your poor Mum is regarded as a cash cow to sort out the family!s debts....

SpideressUK

troubleinparadise wrote: »

This is going to sound harsh, but reading all this it sounds like your poor Mum is regarded as a cash cow to sort out the family!s debts....

Not from my point of view, if I get an inheritance upon her death great, if not then so be it. My priority is to try to make her final years as happy and family centred as possible.

elsien

troubleinparadise wrote: »

This is going to sound harsh, but reading all this it sounds like your poor Mum is regarded as a cash cow to sort out the family!s debts....

I don't think the OP personally is coming across like that at all now they've explained a bit more. I do have reservations though about mum's income being used to cover brother's debt. Is she going to continue to hand all her money I over in the future - that doesn't feel right at all. However if she has capacity and is fully aware of the implications that is her decision to make. The difficulty comes if she ever feels it is unfair but then due to the decisions made is unable to speak up/change her mind.
Has she considered renting out her house instead of selling up? If she has POA she could potentially delegate being a landlord to one of the family to save herself the stress. (You'd need to check that out properly.) It does keep some options open rather than selling which is irrevocable.

SevenOfNine

SpideressUK wrote: »

Ah...so if she did that and died in 5 years and her £60k bit had increased in value the estate would just get £60k? Presumably her rent could go up year by year?

No, if the flat increases in value then the estate would get whatever they were able to sell the portion of flat for, in 5 years that could be more, less, the same - depends on the housing market.

Not sure about the rent but I'd be mega surprised if it didn't go up year on year, though there may be some sort of increase % 'fix'?

If she decides at any point to purchase a larger proportion of the flat, she will pay whatever the market value is at the current time.

She will be maintaining it, new kitchen, bathroom, boiler/heating, decorating etc all improvements done at her expense. May add value, but then if she wants to purchase a larger portion it will cost her more because of all her improvements! (My brother with his 50% shared ownership has added a lot of value with home improvements. That & the climb in house prices where he lives means now can't afford to purchase more of the housing associations 50% share).

Ordinarily IMO shared ownerships are favoured by those who want to get on the housing ownership ladder, but can't afford a 'whole' property.

I'm afraid I'm with mojisola on the "I'm shocked" front. Your brother strips your mum of her entire monthly income £800, :eek: and she also pays for the upkeep of her own property.

Be mindful that this already looks like deprivation of assets (your brother is asset stripping the mother to pay his bills IMO), the LA will take one look at her past & present income/expenditure & know something fishy has been going on, they will dig deep into this.

Browntoa

Keep_pedalling wrote: »

TUPE? I though that was about transfer of employees.

There would be no tax implications on an estate this size.

Auto correct changed Taper to TUPE .......not spotted when I posted ...


And council looking at DOA would look at her bank statements etc , some of what's going on here on her outgoings is not likely to pass scrutiny

Cheeky_Monkey

SevenOfNine wrote: »

I'm afraid I'm with mojisola on the "I'm shocked" front. Your brother strips your mum of her entire monthly income £800, :eek: and she also pays for the upkeep of her own property.

Be mindful that this already looks like deprivation of assets (your brother is asset stripping the mother to pay his bills IMO), the LA will take one look at her past & present income/expenditure & know something fishy has been going on, they will dig deep into this.

Me too! He sounds like a really loving son ................. NOT

SpideressUK

elsien wrote: »

I don't think the OP personally is coming across like that at all now they've explained a bit more. I do have reservations though about mum's income being used to cover brother's debt. Is she going to continue to hand all her money I over in the future - that doesn't feel right at all. However if she has capacity and is fully aware of the implications that is her decision to make. The difficulty comes if she ever feels it is unfair but then due to the decisions made is unable to speak up/change her mind.
Has she considered renting out her house instead of selling up? If she has POA she could potentially delegate being a landlord to one of the family to save herself the stress. (You'd need to check that out properly.) It does keep some options open rather than selling which is irrevocable.

Yes, as far as I know, my brother is planning on continuing the arrangement of her contributing her entire monthly income into the overall household to cover her living etc costs. It is indeed possible that he could already be considered DOA should she need a care home right now but that is his own accountability and responsibility and risk that he has evidently chosen to take.

We considered the idea of renting her house but initially ruled it out thinking that since it is in such a dilapidated state it would probably cost her £10-£20K to modernise it enough to make it legally safe to even start to rent it and she does not have that kind of cash flow to be able to put into such. Since you mentioned it I have just re-investigated it but this time asking rather than guessing and have spoken to an Estate Agent who act as letting agents for advice. They are sending me a pack but said she would certainly need things like gas safety certificates etc.

Mum/Dad have been in that house 40 years and for the past 20 or so years it has become "hoarder" style with tiny walk ways in-between "stuff". I have spent the last 7 months going down as often as I can and doing 12/14 hour days each time (well over 200 hours at least so far) and have been clearing the clutter which then uncovered walls full of mold, curtains which shredded the moment I touched them, sink unit that had evidently been leaking for a long time and was all warped away from the wall etc. I have had as much basic DIY from an odd job type man done as cheaply as possible for the things I cannot do like replacing the kitchen work surfaces, getting the main light in the front room back working (they lived by lamp for a decade or more) etc. Having done my best with lots of bleach to de-mold I have been gloss painting and emulsioning and was just about to start wallpapering when mum decided that actually she did not want to go back there after all :-) So, since it is potentially now to be for sale I did another 14 hour day yesterday (school looked after my boys and dropped them off when hubby was home) and emulsioned the kitchen (that I HAD planned to wallpaper) just to make it more presentable for sale. I am going tonight once hubby is home and emulsioning the hall/stairs/landing and will do another full day soon for emulsioning the bathroom and mum/dad's bedroom all to make it look better for sale.

Even with all of that though the two remaining bedrooms are still full of mold and one is currently full with all mum's "stuff" that I thought she would want/need to keep when moving back in. At a minimum in order to rent I'd have thought she'd need to replace some floor coverings but the house needs a re-wire. There is no heating except one gas fire in the front room so in order to rent I'd have thought she would need to at least have central heating installed.

The guesstimate at rental income, should it be even in a condition to rent is about £600 pm. If my brother is saying he needs the extra £500 pm from clearing his debt if he is going to able to facilitate renting a bigger property so that mum can stay long term with them and if that cannot be done by clearing the debt then all I can think is that this potential £600 pm mum might get in rental goes to cover his £500 but that would leave her in an impossible situation should her rental house ever need repair as all her monthly income from pensions etc is going to my brother and her personal savings are not going to last long if she has to maintain a house as well with all gas certificates and the like.

I am asking the Estate Agents who are coming to tell us about the rental options too but I have a feeling that it is going to cost her too much to put the house "right" enough to rent to make it viable and even if it could be "right" she is not going to have enough money to maintain the house for repairs etc.

Since it appears to be DOA for her to sell and use say £20K/£30K to extend our mortgaged house at the back to make a "granny flat" then her living long term with us in our house also seems unlikely/impossible which leaves the tiny option of her getting a shared ownership flat nearer to me so that I can go in to her once or twice a day and meet all the needs that SS do not meet in their 15 min 4 x a day visits.

This is all based on my brother and his wife/family deciding that unless his £500pm repayment of debt is cleared there is not enough money to rent a bigger place for her to live properly and with the intention of permanently with them.