Changing house deeds to children

Keep_pedalling

Yellowvest23 said:

McKneff said:

Yellowvest23 said:

Keep_pedalling said:

It would be an exceedingly dumb thing to do. Confirmation is a fairly straight forward thing for a simple estate, and this will be considered deliberate deprivation of assets if she ever dies need residential care.

Her security will be at risk if either you or your sibling got into financial trouble, got divorces or died before she does.

It would not be considered deliberate deprivation of assets if she is not in need of residential care at the time of transfer.

Oh it certainly does. The DWP can and do dig back years

It has nothing to do with DWP,its the local council who have to decide weather the house was gifted when the gifter was in need of a care/nursing home.
Yes the council can go back years and if they see the gifter needed a care home when the gift was made they would have a claim.They cant just say you were going to get older so at some point may need a care home otherwise that would aply to any and everyone.The onus is on them to prove a care home was needed WHEN the gift was made.

Sorry but you are wrong. If you give your own home away then you are going to have to show you had a reason other than trying to avoid care costs, and frankly there are no other real reasons for doing so. The LA certainly do not have to show you were already in need of care at the time of the gift. 

Gifting other sorts of asset away are far easier to defend but not your home.

Savvy_Sue

Yellowvest23 said:

https://www.which.co.uk/later-life-care/financing-care/gifting-assets-and-property/gifting-assets-what-are-the-rules-alp865l0wlum

It has nothing to do with age,its solely if the gifter was in need of a care home at the time of the gift,explained perfectly in the Which guidline above.

I don't think the Which guide says that. For example: 

Deliberate deprivation of assets is when the local authority deems that a person has deliberately disposed of assets to increase their eligibility for social care funding.

When a local authority carries out a financial assessment for care it will ask about previously-owned assets, not just those that are owned currently.

That seems to indicate to me that even if you don't need a care home right at the moment when you make the gift, you may still be seen to have deliberately deprived yourself of the asset(s).

Yellowvest23 said:

McKneff said:

Yellowvest23 said:

It would not be considered deliberate deprivation of assets if she is not in need of residential care at the time of transfer.

Oh it certainly does. The DWP can and do dig back years

It has nothing to do with DWP,its the local council who have to decide weather the house was gifted when the gifter was in need of a care/nursing home.
Yes the council can go back years and if they see the gifter needed a care home when the gift was made they would have a claim.They cant just say you were going to get older so at some point may need a care home otherwise that would aply to any and everyone.The onus is on them to prove a care home was needed WHEN the gift was made.

The majority of people do not end their lives in residential care, so you're quite right that they can't just say "you were going to get older". But they CAN look at your intentions at the time of disposing of the asset, AND they can look at whether or not needing a care home was a reasonable expectation. For the majority of people, it won't be, but for anyone giving away their home eg while showing signs of dementia (even if they still had capacity to make such a gift) or suffering from one of the conditions which will only create more physical problems as time goes by, it may be. 

And given that giving away your house has the potential to cause so many problems for both the donor and the recipient(s) (as already listed in this thread), it is very hard to see any GOOD reason to do so, especially if it there is any chance at all of it being deemed as DDA.

TELLIT01

Keep_pedalling said:

TELLIT01 said:

DairyQueen said:

Why on earth do so many elderly people believe that gifting their home to their children benefits any of the parties? (rhetorical). The only possible motive is the mistaken belief that they can avoid paying care home fees.

That's not the only possible motive.  It can also be done to avoid or reduce CGT liability.  As others have said though, the risk in so doing are great and unless there are legal safeguards in place there is a risk of losing the use of the property too.

CGT does not apply to your home, so how would gifting it help? Gifting your house is likely to lead to an eventual CG for the receiver of the gift when the house is eventually sold. Worst case situation is the double whammy of CGT on top of IHT.

Sorry, I did mean potential Inheritance tax.

RetSol

Why on earth do so many elderly people believe that gifting their home to their children benefits any of the parties? (rhetorical). The only possible motive is the mistaken belief that they can avoid paying care home fees.

I think that it is, at least in part, more basic than that. Some parents have an atavistic desire to pass on their assets to their children and doing so in life is part of their preparation for death - and means that they don't have to trust probate, executors etc.  As has been said here, in most circumstances the children should resist the parents' impulse as, rationally, it will rarely be in the latters' best interests. 

missile

RetSol said:

Why on earth do so many elderly people believe that gifting their home to their children benefits any of the parties? (rhetorical). The only possible motive is the mistaken belief that they can avoid paying care home fees.

I think that it is, at least in part, more basic than that. Some parents have an atavistic desire to pass on their assets to their children and doing so in life is part of their preparation for death - and means that they don't have to trust probate, executors etc.  As has been said here, in most circumstances the children should resist the parents' impulse as, rationally, it will rarely be in the latters' best interests. 

I had to google atavistic <LOL>

Hudsonbutler

So the moral is don't buy your own home.

Keep_pedalling

Hudsonbutler said:

So the moral is don't buy your own home.

No the moral is, don’t be an idiot and don’t give your home away.

Hudsonbutler

Keep_pedalling said:

Hudsonbutler said:

So the moral is don't buy your own home.

No the moral is, don’t be an idiot and don’t give your home away.

I won't encourage anyone to buy there own home, just to give it away to local LA. Better off,  as the rules stand, to put money in pensions, as this doesn't form part of your estate.  It seems this method is quite acceptable. Most people including myself, worked dammed hard to own my own property, with the intention of passing it on to my children. But it seems it is thought of as atavistic!

Keep_pedalling

Hudsonbutler said:

Keep_pedalling said:

Hudsonbutler said:

So the moral is don't buy your own home.

No the moral is, don’t be an idiot and don’t give your home away.

I won't encourage anyone to buy there own home, just to give it away to local LA. Better off,  as the rules stand, to put money in pensions, as this doesn't form part of your estate.  It seems this method is quite acceptable. Most people including myself, worked dammed hard to own my own property, with the intention of passing it on to my children. But it seems it is thought of as atavistic!

The percentage of home owners  who have to use their homes to fund care is tiny, so it is absolutely idiotic to suggest people will be better off not buying their own homes because their is an outside chance that you may use it to fund care. They are going to be pouring a lot more money into the hands of a landlord than they would be paying for future care costs.

Pensions are not ignored by the LA, if you are of pensionable age you will be assumed to be receiving income from the pension even if you have not gone into drawdown. You will also be able to put a lot more into a pension if you have paid off your mortgage than if you were still paying rent.

You and many others may have worked hard to own a property, but I am willing to bet that most of its value has been achieved though house price inflation rather than work. We have £600k of capital gain in our house, which required no work, and no tax has been paid on it. The house and combined with pension income would pay for 10 years residential care each which is never going to happen. 

I am more than happy to self fund if care is needed and I want to be able to choose who does the caring and where it is done. First choice will be to have a live in career which no LA will pay for, and second choice will be the best local care home available. Being left with a limited choice that the LA will pay for is not a choice we are willing to accept, which is why we have savings set aside for to cover either of us needing care.

Browntoa

I genuinely know a lady who signed the house over to her daughter " to protect it from care "

The daughter gave it a year and then evicted the mum and sold the house . The mother was classed as intentionally homeless and struggled to both find a place to live and fund it from what little income she still had .