Sibs think we should sell to pay care home fees

[SeriouslyTryadifferentstory]

Context: Victorian semi, converted into two one bed flats by myself and my parents in the '90s. I married and DH and I have continued to live in and own the ground floor flat, with extension and garden (and paid off the bloody mortgage!) , parents owned (paid for outright) and lived in the upper flat. Mum died a decade ago and Dad has recently moved into a care home so his flat has to be sold to pay the fees. DH is also battling a chronic illness.

My brothers (2 of them) think that we should "just sell the whole house and we'll find you "somewhere to live". My Sis is telling them to back off and I just want everyone to go away and leave me alone.

Sorry, just needed to vent.

Sorry to disagree, but it can't be viewed as deprivation of assets because you deprivate nothing, you still have your share, nothing is taken away, given away or hidden.
Deprivation of assets is very tough to prove unless you literally give your home or money to another or sell it for way below its value, a change in the method of joint ownership years before needing care won't raise any eyebrows.
Many many of our clients have done it and I've yet to hear of an LA complaint.
On larger estates it maximises inheritance tax relief by reducing the value of any one bequest.

Thank you. They don’t make it easy.

I totally agree that people must plan to provide for their aged care needs and not expect the tax payer to fund this expense, however the thing with nursing home/private hospital care costs, at least in my DM’s case, is while her family home funds dwindle to pay for her accommodation and care, the parent company of the facility sponsors opera, ballets and other events outside of the business module.

who benefits from these deals certainly not the residents…. and in these cases I think this sort of thing should be regulated.

Sadly this is true, if profits in the care industry were regulated and government wastage (which is vast) reduced, there would be less pressure on the system, it's users and families.

Possible change of government next year, what ideas that may bring, the state the NHS and social care has got in, frankly one would hope the only way is up.

How much money do you think the average person has? Mortgage, food, pension, fuel.

What is the actual point of paying tax?

100% agree. I believe Teresa May was going to sort out a new scheme where we paid I think it was £82000 tops, towards our care homes fees, but no food etc that was purely for accomodation. That was a few years ago, looks like it’s been put on the back burner and would cost a lot more than that now.
The Gov is just evading the situation. Burying their heads in the sand.
Do they think we are stupid and we have forgotten all about it.

But you could also ask, off that tax, how much does the government (pardon my french) piss up the wall? how much of it actually finds its way back to directly benefitting the citizens, pound for pound, not much.

Care is one area thats neglected because its something no one really wants to think too hard about until it happens, and its not flashy like a railway to nowhere that no one wants, for example.

So when you drive on the roads, send your children to school, head to hospital in times of emergency, that the money that’s paid for these services hasn’t come from somewhere?

why do you think taxes are refundable via aged care expenses? Esp as we are all living much longer these days?

That’s true they can put you where they like, other end of the country if it suits them.

Agree with this advice.

An update. Had one EA in today who has confirmed better to sell as two flats and that he wants to chat with colleagues before recommending a price for mine as "I've never seen a one bed flat with this much garden before". Fair enough ... I'm just interested in their valuation and not selling. That has been made clear to EA.

For those suggesting renting out Dad's flat, it just won't work. He's got a good pension but even with rent at £1k a month we'll still be trying to find at least another £1k between us and I think it's probably clear why this won't happen! And for those asking about Freehold, it's shared ownership,.

I've heard nothing from Bro A but Bro B has sent flowers and a "tell her I'm sorry" via his grown-up daughter. She's fine with shoving them up his arse politely returning them on my behalf now she knows what he's been up to.

Thank you all for input, suggestions and support.

Good news OP
Dont let them walk all over you.

Glad to hear its sorting out OP, hope that they both feel very ashamed of themselves - let it pass, sort your dad out and try to mend the relationship with them one day in the distant future, we only get one family, forgive eventually, but don't forget, and always keep out of business/financial dealings with them.

Does your lending laws allow dad to borrow against his asset to fund the ‘gap’ in the monthly charges? And is your property market values likely to increase over time?

if we had kept M & D’s family hone instead of selling it, and rented out the property there would be more asset today than when it was sold 9 years ago to fund the gap. However you would need to work out how much his pension would decrease due to having rental income…

it might be worth thinking about if the lending laws allow this for senior citizens there

My parents’ solicitor warned them against it over a decade ago.🤷‍♀️

Of course it’s deprivation of assets. It removes the possibility of it being used for care, it’s depriving the tax payer.

On larger estates it maximises inheritance tax relief by reducing the value of any one bequest.

That isn’t how IHT works. The only person who can inherit without IHT being incurred is a spouse. Bequests to children are liable.

Well, I'd have to disagree with their solicitor.

Lets say Bernie & Anne get divorced, what percentage would they be entitled too normally? 50%

As Joint Tenants if Anne needs care, her assessment is 50% of the value.

If she lingers in care and Bernie dies, she by default inherits and gains more capital.

If They are tenants in common, that doesn't happen - but Annes 50% assessed share is still available so nothing is deprived.

The care act actually makes provisions for those who are tenants in common. I'm sorry if you lost out to duff advice.

I'm sorry if you lost out to duff advice.

I’m not because I didn’t miss out. I’d rather believe a solicitor with decades of experience who understands how IHT works than some random on the internet who doesn’t.

Children can inherit up to £500,000 without incurring inheritance tax, here it is from the HMRC site

Passing on a home You can pass a home to your husband, wife or civil partner when you die. There’s no Inheritance Tax to pay if you do this.
If you leave the home to another person in your will, it counts towards the value of the estate.
If you own your home (or a share in it) your tax-free threshold can increase to £500,000 if:

• you leave it to your children (including adopted, foster or stepchildren) or grandchildren
• your estate is worth less than £2 million

The amount you can leave your spouse without incurring IHT is infinite.

True, but say a couple own £1m of property as tenants in common, each can leave their DD £325,000 (their nil rate band) plus the £175,000 extra for property, no IHT for DD on £1m

Even if they both, say go into care and loose £150,000 of their respective shares, thats still £800,000 which is taxable, but with the approach I have demonstrated (which is all outlined on the HMRC pages) still no tax for DD to pay.

To be fair, brother B wasn't the one who called you a selfish biitch, and you don't know that he was the 'mate'. That's pure supposition. At least he was open with your sis about the plan, and presumably came to his senses and realised it was unfair.

If he's not the mate, I'd be tempted to have accepted his flowers on the condition that he was entirely open to you about what his involvement was and what was going on.

Good update, OP. Glad all the women are together. Thinking about it, your brothers must have always resented the money your parents made from selling you the house and enjoyed on holidays and making their lives more fun and comfortable. They were literally thinking 'that should have been my money' and wanted to bully you into turning back time so they could get it. Just appalling. At least the worst one is isolated now.

This

was thinking the same.. the brother B might not be involved and has made efforts to apologise.

Bro B has sent flowers and a "tell her I'm sorry" via his grown-up daughter. She's fine with shoving them up his arse politely returning them on my behalf

Thanks for the update @SeriouslyTryadifferentstory .

Please consider forgiving BroB. It's easy to get carried away trying to please a charismatic bullying older sibling and he's realised he was wrong and being an arsehole. If a forgiven and reconciled BroB is on team "BroA is a wanker" then that's a good thing. Tactfully an politely inserting the apology flowers up BroB's posterior could actually make the opposing "side" in this rift stronger.