Can you beat the system on health care

[anobium]

went to visit an old friend in a nursing home recently, he is bed bound but very alert mentally.
He explained how the local authority had put his house up for sale so that they could use the proceeds to care for his medical costs.
All he was bothered about was that his children would have no inheritance when the proceeds from the house had gone.
He had worked hard all his life, never claimed anything and this is how the state repays him.
Makes you think, it did me,
A question if anybody can help?
If both my wife and I now decided on the demise of one of us( in the hopefully far distant future) to leave our share of our house to our children, would that prevent the state from claiming that share for the medical costs in the event that the survivor ended up in a nursing home.
Yes I am aware of the implications of only ending up owning half of the house we would be living in.

 

[WDIK]

you need a mirror will

 

[Shytalkz]

You can gift it to kids, pay proper (not peppercorn) rent and as long as it's 7 years or more before you need the services of the LA, or die, no one can touch it. If you die, no inheritance tax is payable, known as a potentially exempt transfer.

 

[anobium]

you need a mirror will

Checked that out but it just means that either of you end up owning the whole caboodle, and then the state takes the whole lot.

Shytalkz

Thanks that sounds promising apart from the phrase "potentially exempt"

 

[Blasphemous]

A bit of further reading for ya....

http://www.which.co.uk/advice/inher...nce-tax-planning-and-tax-free-gifts/index.jsp

Inheritance Tax!!!! They want Tax all your life from what you earn to what you buy and when you die and your children inherit your PAID FOR ESTATE, they want money from them! SORRY but the effing tax was paid on that estate! It REALLY effs me right off!!! I need to calm down!!!!!!!!!!

 

[conny]

Deep breaths Blas,
Repeat after me,

1,2,3,4,5,6,7,8,9,10


F THEM ALL!!!

 

[Blasphemous]

 

[MarkBarl]

Get down the CAB.

My Mum's in a nursing home, and the proceeds from the sale of the house do indeed have to pay for her care.
However there is a Deferred Payments scheme by where Social Services register an interest in your property and then pay the nursing home until you have sold the property and pay back the money you owe them.

What right do the SS have to sell your home (Unless of course he has already been down this route and only has the £21K equity left) You then have to pay until you only have £21K left. I believe that you can gift up to £3K per year.

It might be worth them checking out a company called Case Asset Management who give advice to people in these circumstances.

 

[PE]

Just playing devils advocate here.....

1. Nursing costs should be met by the state anyway I believe so it is probably his accomodation costs that will be self funded from his assets i they are above a certain level.

2. Children have no right to an inheritance (although many seem to think they do) - you work hard during your life to provide for your retirement which includes the ability to look after yourself either with home care or care or nursing homes. Why should I as a tax payer pay for this? You want to look after your children then gove it to them before you retire or get old enough o be likely to require a nursing / care home

3. Many work hard in their lives but choose not to or cannot buy their own home but rent instead - they don't have a house to leave in their inheritance

I think its a very dangerous road we all go down where we expect the "government" to pay for our retirement and also expect to be able to leave a huge inheritance. The public finances are funded obvioulsy by us and so we are taking on an unsustainable future debt of the elderly by doing this. Combine this with an aging population and you have ...well a potentially horrible situation with only the richest getting good care

Saying all that if of course you believe you should be able to live off the tax payer and have your housing costs paid for by us tax payers there are ways of giving away your assets so they do not fall foul of the "depivation of asset rules" but you will need to pay some clever lawyer plenty of money to do so if you want it watertight

Also consider that if you go in state care or nurisng home you won't get the choice of where you go, may share washing facilities and even a room potentially. Pay for it your self and you choose where you live

You pays your money you takes your choice

 

[JohnD]

Once you've gone into a care home it's probably too late. You are supposed to pay for your own care if you can afford it (unlike going into hospital) so if you are in a £500 a week care home, and you have either £100,000 in savings or a house worth £100,000, then your money, or your house, is going to have to pay for it. People tend to think that if their wealth is in a house rather than in a savings account, they should be allowed to pass it on to their family, but wealth is wealth whether it's in bricks and mortar or gold bars. To get care paid for by the council, you have to be really hard up - I think the current figure is that if you have more than £16,000 of assets you are expected to pay until it's gone.

However:
if (1) your husband or wife owned the house jointly with you, then their half of the house can't be used to pay for your care (unless they want to). So they can live in the house without having it sold and then losing their home. they can also leave their share of the house to the kids, and with a clause saying that you have a life interest to live in the house until you die. This is very common (it used to be done to avoid paying inheritance tax twice) and you can do the same with your share, so the house stays until the second partner dies or moves house

Also, if your kids live with you, you can give part of it to them, and this puts their share out of reach of your assets that may be taken to pay for your care home. Sadly there are times when a parent has given the whole house away, and the kids then decide to sell it and chuck the parent out; or to take out a secured loan which they are then unable to pay so the house gets repossessed.

Provided you give away part or all of the house before the time comes when you need care, I am told the councils will not try to get it back. However, once you are running up a care bill, they can argue that you only did it to avoid paying your debts, so they can still get some or all the value when it is sold. This is a bit like the businessman who is going bust and tries to put the house into his wife's name to avoid it being seized by the people he owes money to. If you want to argue you will probably have to go to court.
(the final para is what I have heard from Social Workers involved with older people, it is a question that often comes up, not from my own experience)

 

[anobium]

Why is it that in Scotland the State pays all these costs.
If they can afford it why not in England.?

 

[Blasphemous]

Why is it that in Scotland the State pays all these costs.

Because they're not just paying for it... the rest of the British tax payers are too.

 

[Stivino]

Why is it that in Scotland the State pays all these costs.
If they can afford it why not in England.?

That's incorrect. On mother's day this year, my mother had a stroke (she's 79) After a couple of months in hospital, the doctor took me aside and told me that she won't be able to look after herself again and that she'll have to go into care. In the next breath, he asked me if she owned her house. To which I replied "what business is that of yours?" I was told I'd need to sell it. I said I was going to live in it and he said it wouldn't be possible.
So, I first fell out with him and then I fell out with the social worker who had been appointed to the case.
To cut a long story short; my mother is now in care. It's being paid for from her savings, which have nearly run out. I'm trying to sell my house so that I can BUY my mum's house, at full market value. The proceeds of the sale will then go to pay for her care.
I'm also in the process of applying for interim funding.
I think she'll have to pay for her care until she has £22,000 left. I'm not sure about the £3,000 a year gifting, I'll need to check on that.

 

[masona]

If both my wife and I now decided on the demise of one of us( in the hopefully far distant future) to leave our share of our house to our children, would that prevent the state from claiming that share for the medical costs in the event that the survivor ended up in a nursing home.
Yes I am aware of the implications of only ending up owning half of the house we would be living in.

I'm not an expert on this but have a look Joint Tenancies and Tenancies in Common which I have with my mother property and I'm also on the house deeds 50/50 with my mother. You have to be careful if you're nowhere near elderly age that if one of the children own the share of your property and they go bankrupt, money trouble or marriage divorce costs and their share will be taken into account & then you could lose your property. It's all about timing it right and depends how much you trust your children, I haven't done it yet with my children but will when the time is right.

 

[anobium]

I stand corrected on the nursing and care home charges in Scotland.
Apparently you can get up to a maximum of £140 per week in England and upto £220 in Scotland.
Still quite a difference, over £4000! per year.