Mum wants to transfer house deeds to myself after dad has died.. best way to do it for her?

justwhat

MaiTai said:

A deed of variation may not be used to bypass the rules regarding deprivation of assets.
Legally it is still viewed as a gift by the original beneficiary of the will.

"When your council is deciding whether getting rid of property and money has been a deliberate deprivation of assets, they will consider two things:

1. You must have known at the time you got rid of your property or money that you needed or may need care and support
2. Avoiding paying for care must have been a significant reason for giving away your home or reducing your savings."

1. Assumption is made the wife /mother is  fit and healthy
2. Assumption is made the WILL is changed to rectify a wish of the deceased party.


Even as a straight gift the council can consider it as deprivation of assets after 7 years.

tooldle

OP, does your mum have a pension of her own, and / or a pension from your dad? If so, don’t forget, this would be available to contribute towards care home costs. If mum did need to sell her house, it maybe that she spends very little of her ‘house money’ on care as the pensions cover most of the cost.
Better to use her own monies to buy the care she needs, than to ‘hide’ the  house, have to hand over all of her pension income (minus the personal allowance) and have absolutely no control over where she is placed. If she has the funds to be able to chose, i’d recommend that she does. 

youth_leader

I don't understand how it has changed since 1999.  My Mum sold her bungalow and put down a £50K cash deposit on a house with my brother and SIL, he got a £42K mortgage. Sadly she died a year later, my SIL had burnt her financial records so I don't know if she was on the mortgage.  He sold the house to give me my 'inheritance' of £25K.

Good point @tooldle, I'm a widower of 64 and have been worrying about possible future care costs.  My IFA said my pensions will be paid towards the costs, so I won't have to draw on as much of my invested savings as I'd thought. 

elsien

justwhat said:

MaiTai said:

A deed of variation may not be used to bypass the rules regarding deprivation of assets.
Legally it is still viewed as a gift by the original beneficiary of the will.

"When your council is deciding whether getting rid of property and money has been a deliberate deprivation of assets, they will consider two things:

1. You must have known at the time you got rid of your property or money that you needed or may need care and support
2. Avoiding paying for care must have been a significant reason for giving away your home or reducing your savings."

1. Assumption is made the wife /mother is  fit and healthy
2. Assumption is made the WILL is changed to rectify a wish of the deceased party.


Even as a straight gift the council can consider it as deprivation of assets after 7 years.

And from the OP, giving the house away to avoid future care charges is exactly why this idea has been proposed. 

Grumpy_chap

elsien said:

And from the OP, giving the house away to avoid future care charges is exactly why this idea has been proposed. 

I'm not 100% sure that the OP was about avoiding care costs, but rather IHT:

welshlad46 said:

mum is worried that if something happened to her that her and dad would as she says “turn in there graves if the state were to get the house”.

I have been informed about the 7 year rule thing? 

That is written in the context of the mother having also passed (hence "her and dad turning in their graves") and the implications of IHT.  No mention (specifically) of funding care and deprivation of assets - perhaps that was not even a factor that has been considered.

So, the first question for the OP / OP's Mum about avoiding IHT is whether the estate would be liable for IHT in any case?

youth_leader

When my husband died I was told I inherited his IHT allowance of £325K, I'm never going to reach £650K so all is well! 

welshlad46

Sorry ive been busy all day and only now got around to reading all this and i thank you all for replying, so the house is probably worth around £150,000 ish., is fully paid for. My mum has now just done her WILL.. she had left everything to me my wife and our little girl. She was told to leavr the house out of the WILL.. im unsure why. She is in very good health and dad passed away very sudden he had a heart attack while asleep at night. My mum and dad have always said that they “bought the house for me” over the years and when dad finished work a few years ago he payed the mortgage off. My mum gets half of dads works pension for the rest of her life now (around £600 a month). Me and my wife are home owners paying a mortgage currently if that helps for further advice. Ive been told by a few mates that the ownership change was the best option but after reading all these comments i am unsure now and il be honest it is a field i have very little knowledge on, and nor does my mum. She has literally within the month sorted the WILL and the power of attorney to me and my wife. 

Sorry for the lobg reply

So if your saying not to do the change of ownership what would be recommended for the safety for the house. As i have said, i have told her that it is her house and to be honest id rather her and dad lived to 100 and i didnt ever get the house but she is looking at reality here

cheers

Grumpy_chap

If the house is £150k, does your mother have assets that make the estate liable for IHT?

user1977

welshlad46 said:

So if your saying not to do the change of ownership what would be recommended for the safety for the house. 

If she's leaving everything to you in her Will, that will include the house (assuming she hasn't sold it by then). That's fine, there's nothing more complicated she needs to do.

Wkmg

Can I just ask, what is the time scale for this? How long before you need care is it reasonable to make large gifts to your children without it being deprivation of assets?