Buying a property for my 90 year old mum

Cgmc

I am in the process of selling my main residence of 23 years held in my sole name. My 90 year old mum has lived with me since the death of my father 10 years ago. I am her only carer. The money from her sale is invested £130k. My French husband also lives with me for 12 years. He and I bought a holiday home in France 2 years ago. He is being moved back to France for work. I have found a city centre apartment to buy which will be my main residence for myself and mum and we would take regular holidays to France. It is £200k and plan was to each pay 50% and put it In joint names and then I have realised I may be liable for the additional 3% stamp duty, nearly £6k so I want to avoid this if possible. I'm really stuck what to do as if I don't have a home here my dear mum would have to go into care and I don't want that. I am thinking of the following option and would like advice please. I give my mum £100k as an interest free loan which is repayable on the sale or her death. That way she has the property in her name. My mum then has a new will leaving 75% of her property to me and 25% to my daughter (her wishes) should I die before my mum my share goes to my daughter. If she ever needed to go in to care would this protect my money? Also am I correct in thinking as the total assets is below £325k there would be no death tax? 

Browntoa

No , it's unlikely to protect the property against care home fees.

Google "deprivation of assets" 

Care fees would be done as a charge on the property and any residual would be split as per the will.

The £130k needs to always now be considered as hers for the provision of care , if it's tied up in property you are likely to be forced to sell to settle care fees.

At age 90 any movement of money or attempting to "protect" it will fail as it's a very reasonable assumption that she could very soon need some sort of care

[Deleted User]

You're selling your current main residence to purchase another main residence so the higher rate of SDLT should not apply. However, a married couple can only have one main residence for the purposes of SDLT (and CGT for that matter) so is it the house you're selling or the property in France? 

A will won't protect your mother's money should she need to pay for care nor will giving the money away now as the council could claw it back. 

Cgmc

Hi, I am selling my main home in the UK to buy the apartment.  I would still have a 50% share in the French House.  Would the loan agreement protect my money should my mother ever have to go in to care. I know we woukd have to sell the apartment to pay for her care but I woukd be able to take my money I loaned back? 

Cgmc

No , it's unlikely to protect the property against care home fees.

Thank you but that's not what I'm trying to do. I know should my mum ever need to go into care the £130k would be taken into account and the apartment would be sold.  What I want to ensure is that if I lend my mum the money towards the purchase as she doesn't have enough to buy it. I don't lose my money to care home fees if that makes sense? I'm not trying to hide money I just want to avoid higher rate stamp duty 

[Deleted User]

Cgmc said:

Hi, I am selling my main home in the UK to buy the apartment.  I would still have a 50% share in the French House.  Would the loan agreement protect my money should my mother ever have to go in to care. I know we woukd have to sell the apartment to pay for her care but I woukd be able to take my money I loaned back? 

If you lend your mum the money then it should not be taken into account for care fees. You could further protect it by having a charge against the property. 

xylophone

As I understand the situation, your mother has £130,000 in savings/ investments. This  money arose from the sale of her own property. Following the sale, she joined you and your French husband in your own family home in the UK where she is happy, settled and cared for.  Your  husband now has to return to France because of his job.
You are intending to sell the family home and buy a property in France with your husband.
It is not practical for your mother to live in France.
You intend to lend your mother £70,000 so that she can buy a flat in England with her own money (as above) where you will live with her but will take trips to France as and when possible.
This seems to me to be no problem at all.
You and she should see a solicitor to arrange for a formal loan agreement to be drawn up- you will take a first charge on the property to secure the loan.
Should the property need to be sold to fund her care fees, you will be entitled to repayment of your loan before the rest of the money is used for her care.
Your mother should consult her solicitor about her will.

Cgmc

You are intending to sell the family home and buy a property in France with your husband.

Thank you for your feedback. You are correct in everything you say apart from the above sentence. We already own the holiday home in France. Myself and my husband own it jointly. It has never been a main home purely used 2 or 3 x à year for hols. I am selling my main home here in the UK to buy the apartment for mum and myself and that will become our new main home. If I buy in joint names (mine and mum's) would I have to pay the additional 3% SDLT? If so it would be better to give herr a loan and buy in her name and continue as you recommend with the loan charge and new will. I would provide £100k as she wants cash left £30k for herself should she want anything

Thank you for your advice, very much appreciated 

xylophone

Your husband will either live in the holiday home or simply rent an apartment in France?
The house you are selling is your principal private residence. You are selling it. You could buy another main residence as its replacement without paying extra SDLT. 
At the moment, your mother has no legal or beneficial interest in your PPR.
Is there any reason why she  needs to have a financial interest in the apartment?
Could you not buy it and your mother simply continues to live with you as heretofore?
That way, she keeps her savings/investments. She would need to  write a new will/execute a codicil if she wishes to change any current dispositions.

Cgmc

My husband would live in the holiday home.
I thought because I have a share in another property in France I automatically have to pay the higher rate sdlt? If that is not the case and I would not have to I would just revert to plan a and buy it in mine and my mother's name and each pay 50%of the price. 
We are both looking to put money into the apartment so I don't have to take on a mortgage. That way we both have our own savings and I have fewer outgoings if that makes sense. 

xylophone

Re SDLT https://www.gov.uk/stamp-duty-land-tax/residential-property-rates
The expert on SDLT is this member
https://forums.moneysavingexpert.com/profile/SDLT_Geek
You could try a pm.
If unsure, you could lend the £100,000 to your mother and proceed as previously outlined?
Another thought, are you yourself over 60? If so, then even were your mother to need to go into care, were you to remain resident in the property, it should be disregarded in any assessment for care home fees.