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care home fees and gifts to family

(24 Posts)
bassetfeet Mon 15-Apr-13 17:50:59

Hope someone can help . Have googled but it seems muddy waters
My mum is mostly self funding in her care home for 7 years . We sold her home and her assets are £145,000. Fees are around £560 per week .
She is 91 and in robust health for her age .

My query is that she wants to give my sister and I an annual gift of money

Must add here that this so not trying to avoid paying when her money runs out . Truly not so at all . Accept this is how it is and council policy

My mum wants to help us while she is alive . So can anyone tell me how much she can give to us without it seeming as if we are trying to be dishonest ?

Am talking maybe three thousand a year for both daughters . Mum wants to do this .

I just do not want to be accused of taking money later by the local council if her money runs out .
thank you

LIZS Mon 15-Apr-13 17:54:02

I think 3k pa is the maximum allowed to avoid inclusion in the estate for Inheritance Tax although she is probably below the threshold anyway.

3littlefrogs Mon 15-Apr-13 17:55:55

IME I don't think she can give you anything. Unless you can prove that the money she gives you is not needed to pay her fees. That means that her fees must be covered by her pension plus an income from, for example, annnuity, insurance policy or similar.

Once my parents went into care their money was all considered to be earmarked for fees. My dad is allowed £10 spending money per week for himself.

Maybe local authorities differ though. You would have to get legal advice.

3littlefrogs Mon 15-Apr-13 17:58:37

It is very hard to accept, given that as she is self funding, her fees will be about 40% higher than the fees paid by the state for the residents who are not self funding.

memphis83 Mon 15-Apr-13 18:01:40

I think 3littlefrogs is right in saying she can't give you anything.
We were told our g was going to die so her son came from Austrailia to say goodbye. She pulled through and she gave him £1000 for flight home. The bank statements were looked at and once her money got te the threshold of the bill being paid for her social services questioned every £ drawn from er account and a thousand was too much to be gifted and he is in process of paying it back.

bassetfeet Mon 15-Apr-13 18:38:24

That is awful memphis so sorry to read this . Not fair is it ? This is such a grey area . How can it be that a dying mum cannot pay for her son to be by her side .

Thank you also 3littlefrogs for reply . I think it is now £20 allowed for personal needs re toiletries and clothes etc . I get a lot more for my mum than that sum as you will do also I bet out your own money .

LIZS thank you for advice and reply . much appreciated .

titchy Mon 15-Apr-13 18:46:03

I guess she could give it to you, but you'd have to be prepared to use it to pay her care home costs once her own money has run out as the local authority wouldn't pay.

bassetfeet Mon 15-Apr-13 19:09:12

As i said it would be a gift each year towards Birthdays ,family weddings sort of stuff .Some contribution towards her clothes etc. A weekend away that mum wants us to have in her old hometown and take some pics .

Completely understand that if someone has the funds to get care then pay they must .
What is bewildering me is the fact my mother cannot give her daughters any money as a gift to get presents etc . Make her feel good .

It seems to me so sad .
anyway thank you for your thoughts . much appreciated .

Isityouorme Mon 15-Apr-13 20:46:08

I am sure she can give a max of £3k per financial year per person. She could have given you a cheque dated pre 5th April for £3k and one today for same amount and these are classed as gifts.

bassetfeet Mon 15-Apr-13 21:06:18

Thank you Isit for your advice .
Mum can still sign and understand her own cheques for gifts to family .
much clearer now.
ah mumsnet flowers .

3littlefrogs Mon 15-Apr-13 22:59:39

Isit - those are the rules for tax purposes. The rules regarding deprivation of assets apply to any spending of an individual's money once that person is in a care home. She wouldn't be allowed to give away anywhere near three thousand pounds because that money has to be used to pay care fees.

Anything that an individual gives away during the time they are in a care home would have to be paid back to the state once the individual runs out of funds and applies for state help with fees.(I am sitting here with the Age UK financial advice document in front of me at the moment). So the op and her sister might find themselves in a position of being liable for payment of fees up to the value of all gifts, until the full amount was paid back.

bassetfeet Mon 15-Apr-13 23:40:06

Thank you for coming back with advice 3littlefrogs
This is too big a minefield isnt it ? And no concrete policy .

One thing I have learnt .........equity release now from my hard earned home while I can give help and small gifts to my family NOW. smile

Fortunately I keep a strict log on what I spend on mums needs .

Really appreciate your words and help here . Will do nothing now.

3littlefrogs Tue 16-Apr-13 06:35:14

OP - get in touch with Age UK. It is a minefield, but there is a lot of useful advice/fact sheets on their website.

If you want to give your money to your family, make sure you do it within the tax regulations, and well before there is even the slightest suggestion that you might need any sort of care. I think social services can go back several years when they do a financial assessment.

I have recently found out that they only allow 12 weeks to sell property once the savings run out, so that is likely to mean we will have to reduce the asking price.

3littlefrogs Tue 16-Apr-13 06:38:19

Anything you buy for your mother for her own needs should be paid from her funds. Make sure you organise power of attorney while your mum is still capable of understanding and signing.

bassetfeet Tue 16-Apr-13 19:02:15

Hi 3little yup I have power of attorney . Mum is still very lucid and for now makes out her own cheques etc. However she naturally doesnt want the worry of the bigger financial issues like investing her money from sale of her house to fund her frankly insipid care . But she doesnt want to have anymore upheaval . I have had so much hassle from govt agencies . It did not help that mum came down to a home near me from Scotland . No one seems to know what she is entitled to sad .

I dont think you should feel pressured to lower the price of your parents house to fit in with the 12 week rule . It took a while for my mums home to be sold . The relevant council /agency paid the fees until house sold and then I paid money owed back .

Will contact Age UK and thank you again for your help and kindness .

3littlefrogs Tue 16-Apr-13 19:06:44

Yes - we have decided to arrange to pay back the fees once the flat is sold. We think we can get a reasonable price by holding on a bit longer.

It is exhausting though. My PIL are my 4th and 5th elderly relative to go through all this with. That is on top of my own DC and a job plus everything else life throws at you.

No end in sight - they are all heading for their 90's. Love them all dearly but it is like the toddler years all over again, but it just gets worse, not better.

bassetfeet Tue 16-Apr-13 19:31:23

It is beyond stressful 3little I truly feel for you . I was exhausted after only my mums experience . can only send you [flowers ] and my admiration at how you keep going .
Truth is I barely kept sane while juggling children and work ..you know the rest . Travelling 200 miles on days off to keep on top of house sale and upkeep . The never ending forms and phone calls months later asking for stuff they already have on their books ..........argh .

thank you and some empathy through the ether . Toddler years . oh yes .

3littlefrogs Tue 16-Apr-13 20:03:33

You really need a sense of humour:

"why can't your father come and apply for his blue badge in person"
"er - he can't see and he can't walk"
"well we must see him in person"
"if I bring him, can I park outside?"
"not without a blue badge"
confused

bassetfeet Tue 16-Apr-13 20:51:25

Ah yes humour needed while banging your head on the desk eh?
It is a comedy sketch until you are dealing with this week after week ....and on and on .............

bassetfeet Tue 16-Apr-13 22:40:34

that sounded a bit confused
A bit solidarity is what I meant 3littlefrogs. I so know what you mean .

trevord Wed 17-Apr-13 13:44:47

Hi bassetfeet

The answer to your questions can be found in the relevant Charging for Residential Accomodation Guide (CRAG), easily findable via Google. There are four different guides for England, Scotland, Wales and NI, so make sure you find the right one.

You need to look at the section on Depravation of Capital. This broadly explains that, where avoiding care fees is a significant motivation in disposing of capital, then the Local Authority have the right to take it into account as if the person still owned it.

3littlefrogs, the wording implies that it is not as black and white as "you can't give away anything", however it may be open to interpretation by the courts, so the Local Authority may have a go if they think it is worthwhile.

LIZS you are right, however the laws governing IHT are different to those governing social care funding, so what works for one will not necessarily work for the other.

I need to declare that I am an IFA specialising in care fees and other later life issues (sorry about that!). This information ahould not be taken as advice and you should always seek advice specific to your circumstances.

Hope this helps!

bassetfeet Wed 17-Apr-13 17:37:19

Thank you trevord very helpful info . smile

3littlefrogs Wed 17-Apr-13 17:53:06

Thank you trevord.

The difficulty is in the interpretation. I don't have the funds to take on an argument in court, and the local authority where my father is have made it very clear that he can just about buy me a birthday card and nothing more. He is blind, in a wheelchair, needs everything doing for him - and I mean EVERYTHING, but he does not qualify for any funding as he does not need nursing input. The manager told me that even if he qualified for a nursing component it would be such a tiny amount that it would hardly make a dent in the £800 per week fees.

Issy42 Wed 17-Apr-13 21:50:23

My aunt recently asked this question of my grandmother's solicitor and the advice she got was that we could all have £1000 each. This was in Wales.

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