Long term care - deprivation of assets question

MattyNeth Forumite Posts: 182 Forumite
My mother-in-law has liquid assets of about £50,000. Her mother went into a care home a couple of years ago after a sudden stroke, and has so far spent over £60,000 so far in fees (it turned out so had £100,000 in a current account which no-one knew about!). The mother-in-law does not want to see her money exhausted at a similar rate of £600 a week if she ever needed to move into a home, and wishes to move 30-40k to her daughter and grand daughter (her idea is to buy premium bonds for them). She is 65 and in good health.

Would this count as deprivation of capital if in 10-20 years time she needs to go into a carehome? From what I have read on the Age Concern website this would not as there seems to be some sort of 6 month limit for council to recover such assets?

If she bought premium bonds for the grand daughter (who is 3 years old) in her own name would this be counted as her own capital, or would it be best to move the money to her daughter to buy on behalf of her grand daughter?

There are no IHT implications has her total estate is well below the limit

Many thanks,


  • Ted_Hutchinson
    Ted_Hutchinson Posts: 7,142 Forumite
    Paying the Fees of a Care Home in Englandthe Counsel and Care leaflet makes the point that Local Authorities are not restricted by time when considering "Deprivation of Capital"
    although the example they give of a Grandmother giving Premium Bonds to grandchildren 3 yrs prior to care home costs arising does indicate they think this may be acceptable.

    This further discussing of the ethical position of those advising in such circumstances may prove relevant.
    Providing Information in a ‘Grey Area’: advising on the transfer ...
    All my parents and PinL are now dead so I don't have this problem but should I face the prospect of a care home and the possible payment of fees I would feel somewhat limited for choice if I were solely dependent on the LA to meet the whole cost. I would prefer my children to be in a position to supplement the funding so that appropriate care can be provided in a home where they could visit. It follows that any disposal of capital some years ahead should be to sources which could be called upon if and when needed. Too often when the old person requires support those who benefitted from the capital dispersal will have spent it and when it comes the old person needing a more suitable home in a more suitable area the children may not give a toss.
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