Asset/Estate Planning Advise

Keep_pedalling

ciscobloke01 said:

Keep_pedalling said:

ciscobloke01 said:

Keep_pedalling said:

ciscobloke01 said:

OK so i assume that if one needs care whilst the other is alive and still living in the house that be setting up trusts with the children for each others half would mean they couldn't use the house as they effectively only own half a house? 

If one needs care while the other is still living in their home is disregarded no trusts needed.

What I was suggesting is that on the first death that that share of the house goes into trust, That trust is created by the will and automatically comes into effect on death not before. The surviving spouse would retain beneficial interest in that share but legal ownership sits with the trust until they die at which point the remaindermen (you and your siblings) will inherit. 

This does not mean the other share of the house would be excluded if they need care just because the legal ownership is split. 

Try to protect the whole thing is just not on and if anyone suggest they put the whole house in trust that person is doing so too set up a useless trust for a big fat fee and they are the only people that will benefit.

Would you really want your mother or father not be able to get the best care they can get at the time they need it (not the time the LA think they are decrepit enough to have it funded) just so you and your siblings can inherit more?

So to clarify, they would both need to state in the wills that each half goes to trust?  Do they need to be Tenants in common with the land registry to do this?

I'm not clued up at all but just found out they had an appointment with a solicitor to transfer the property to us children. I take it this is not advisable? 

No it would be a terrible idea. As they remain living there  it becomes a gift with reservation which means it never falls out of there estate for IHT purposes (unless they are also going to pay you full market rent to stay there) and will be subject to CGT on any gain in value when it is sold. 

The LA would also look at this as deliberate deprivation of assets should residential care be nessesary for a surviving spouse. There house would also be an assets if you or any of your siblings divorced, or go bankrupt. It would also potentially cause problems if any of you are (or become) dependant on means tested benefits or die before they do.

Please don’t let them do this it is utter folly.

What about any savings?  My idea was to slowly give this to us for us to look after for them and give back as and when needed.  I know people will say its dangerous, and what if x divorces or needs benefits etc etc but im not looking for the negatives on that front, just the answer to my question.

Hiding money in someone else’s name is fraud. 

ciscobloke01

Keep_pedalling said:

ciscobloke01 said:

Keep_pedalling said:

ciscobloke01 said:

Keep_pedalling said:

ciscobloke01 said:

OK so i assume that if one needs care whilst the other is alive and still living in the house that be setting up trusts with the children for each others half would mean they couldn't use the house as they effectively only own half a house? 

If one needs care while the other is still living in their home is disregarded no trusts needed.

What I was suggesting is that on the first death that that share of the house goes into trust, That trust is created by the will and automatically comes into effect on death not before. The surviving spouse would retain beneficial interest in that share but legal ownership sits with the trust until they die at which point the remaindermen (you and your siblings) will inherit. 

This does not mean the other share of the house would be excluded if they need care just because the legal ownership is split. 

Try to protect the whole thing is just not on and if anyone suggest they put the whole house in trust that person is doing so too set up a useless trust for a big fat fee and they are the only people that will benefit.

Would you really want your mother or father not be able to get the best care they can get at the time they need it (not the time the LA think they are decrepit enough to have it funded) just so you and your siblings can inherit more?

So to clarify, they would both need to state in the wills that each half goes to trust?  Do they need to be Tenants in common with the land registry to do this?

I'm not clued up at all but just found out they had an appointment with a solicitor to transfer the property to us children. I take it this is not advisable? 

No it would be a terrible idea. As they remain living there  it becomes a gift with reservation which means it never falls out of there estate for IHT purposes (unless they are also going to pay you full market rent to stay there) and will be subject to CGT on any gain in value when it is sold. 

The LA would also look at this as deliberate deprivation of assets should residential care be nessesary for a surviving spouse. There house would also be an assets if you or any of your siblings divorced, or go bankrupt. It would also potentially cause problems if any of you are (or become) dependant on means tested benefits or die before they do.

Please don’t let them do this it is utter folly.

What about any savings?  My idea was to slowly give this to us for us to look after for them and give back as and when needed.  I know people will say its dangerous, and what if x divorces or needs benefits etc etc but im not looking for the negatives on that front, just the answer to my question.

Hiding money in someone else’s name is fraud. 

Ok, but what if they just wanted to treat their children to nice holidays every year? Buy their grandchildren presents etc

Keep_pedalling

ciscobloke01 said:

Keep_pedalling said:

ciscobloke01 said:

Keep_pedalling said:

ciscobloke01 said:

Keep_pedalling said:

ciscobloke01 said:

OK so i assume that if one needs care whilst the other is alive and still living in the house that be setting up trusts with the children for each others half would mean they couldn't use the house as they effectively only own half a house? 

If one needs care while the other is still living in their home is disregarded no trusts needed.

What I was suggesting is that on the first death that that share of the house goes into trust, That trust is created by the will and automatically comes into effect on death not before. The surviving spouse would retain beneficial interest in that share but legal ownership sits with the trust until they die at which point the remaindermen (you and your siblings) will inherit. 

This does not mean the other share of the house would be excluded if they need care just because the legal ownership is split. 

Try to protect the whole thing is just not on and if anyone suggest they put the whole house in trust that person is doing so too set up a useless trust for a big fat fee and they are the only people that will benefit.

Would you really want your mother or father not be able to get the best care they can get at the time they need it (not the time the LA think they are decrepit enough to have it funded) just so you and your siblings can inherit more?

So to clarify, they would both need to state in the wills that each half goes to trust?  Do they need to be Tenants in common with the land registry to do this?

I'm not clued up at all but just found out they had an appointment with a solicitor to transfer the property to us children. I take it this is not advisable? 

No it would be a terrible idea. As they remain living there  it becomes a gift with reservation which means it never falls out of there estate for IHT purposes (unless they are also going to pay you full market rent to stay there) and will be subject to CGT on any gain in value when it is sold. 

The LA would also look at this as deliberate deprivation of assets should residential care be nessesary for a surviving spouse. There house would also be an assets if you or any of your siblings divorced, or go bankrupt. It would also potentially cause problems if any of you are (or become) dependant on means tested benefits or die before they do.

Please don’t let them do this it is utter folly.

What about any savings?  My idea was to slowly give this to us for us to look after for them and give back as and when needed.  I know people will say its dangerous, and what if x divorces or needs benefits etc etc but im not looking for the negatives on that front, just the answer to my question.

Hiding money in someone else’s name is fraud. 

Ok, but what if they just wanted to treat their children to nice holidays every year? Buy their grandchildren presents etc

Gifting is fine as long as you maintain sufficient assets for your own needs. We have done plenty of that over the years, but are in the fortunate position to still be self fund any care we may need and there is no way we want to be reliant on a cash strapped LA to do it. We would chose to have live in carers rather than residential care but if that was not possible we would want something a bit better than the LA could afford to pay, and we want care provided when we need it not have to wait until you are decrepit enough to get past the funding panel.