How much can I gift my dad

gh67

My dad is in his 80s and with price of living going up he needs help, as he is on pension credit he doesn’t pay council tax. I believe I can gift him £30k over 5 years without it effecting his benefits, is this correct, everything will be done through a solicitor so I get my money back when he eventually pops it. 

Mojisola

gh67 said:

My dad is in his 80s and with price of living going up he needs help, as he is on pension credit he doesn’t pay council tax. I believe I can gift him £30k over 5 years without it effecting his benefits, is this correct, everything will be done through a solicitor so I get my money back when he eventually pops it. 

Might be better to document this as a loan rather than a gift.

Someone on PC can have capital of £10,000 without it affecting their benefits.

I don't know where you've found the £30k over 5 years info.

Edi81

If you are expecting it back when he passes away it’s not a gift. It’s a loan. 

From a practical perspective is it not easier for you to just pay some of his bills yourself. 

gh67

Sorry folks you are correct it's a loan and it will be paid back off his estate when he passes, I was just told you could gift someone money without it impacting their benefits. We are meeting with our solicitor today to see what he thinks, I was just wanting some more knowledge before meeting him.

My dad is thinking of going down the equity release road and I just don't think this is a good idea.

MallyGirl

you might getter a better response on the benefits board as that is what you are concerned about. I will get this moved.

MSE_ForumTeam5

Moved from Loans to Benefits board

Keep_pedalling

gh67 said:

Sorry folks you are correct it's a loan and it will be paid back off his estate when he passes, I was just told you could gift someone money without it impacting their benefits. We are meeting with our solicitor today to see what he thinks, I was just wanting some more knowledge before meeting him.

My dad is thinking of going down the equity release road and I just don't think this is a good idea.

If he went down the ER route then the equity he released would be treated as savings. What you are proposing could be seen as a private ER scheme as I presume you will be securing the loan against his home so could also loose benefits. Solicitors are rarely also benefits experts so great care needs to be taken here.

Is there any reason you are looking at a lump sum loan rather than contributing to his expenses by doing something like pay his energy bills directly. 

TELLIT01

The simplest course of action, which doesn't involve solicitors and their fees, would be to pay utility bills for him.  The downside for the OP is that this doesn't protect their money when splitting up his assets when he dies.  Maybe I'm cynical, but protecting their assets and inheritance seem to be the main driver for the OPs actions. 

Going down the ER route would potentially affect his benefits and would certainly reduce the value of his estate.

Mojisola

Keep_pedalling said:

gh67 said:

Sorry folks you are correct it's a loan and it will be paid back off his estate when he passes, I was just told you could gift someone money without it impacting their benefits.

If he went down the ER route then the equity he released would be treated as savings. What you are proposing could be seen as a private ER scheme as I presume you will be securing the loan against his home so could also loose benefits.

As long as any one gift doesn't take his capital over £10,000, I don't see why it would affect his benefits.

A simple loan agreement between father and son would cover repayment in the future - whether that's when the father dies or needs to go into care.

gh67

Tanks for all your replies, after speaking with the solicitor it’s clear we have to keep his savings under £10k. We have agreed I will top up his bank account by a few thousand each time he runs out, also making sure she’s under £10k.

The house is in a trust divided between 3 people, once my dad passes I will receive payment plus interest from one of the other persons 1/3. There’s reasons from taking it from that persons instead of from the whole pot then divide by 3, example my dads house is worth £210k I loan him £30k, we he passes I get £70 another gets £70 and another gets £70 minus what I’m owed. 

Keep_pedalling

I hope this is not one of those avoiding care cost trusts, because if it is you may find deliberate deprivation of assets kicking in if he ever needs residential care, which may scupper you getting your loan back.