Is this legally ok?

[Parentsworry]

Hi!
Im worried my parents are been a bit neaive.
facts

• grandad got Parkinson’s 10 years ago
• sold his flat for 100k
• paid for his son (my dad) and his daughter (aunt) to change there homes, about 50k
• gifted them the rest. They got poa and lawyer apparently said this is fine as per 7 Yr rule
• ever since dad and aunt take £650 each from him for care and do two weeks each.
• he has about 20k in savings

they can no longer look after him and have started looking at nursing homes.

Have the done anything wrong?

Ps. He now also has Alzheimer’s and cancer and falls a lot

What is it you are concerned about?

Were they ok to take £650 each for care and to take the gifted money. For care I think they will look at grandads money and make my dad and aunty pay some back or pay for his care?

When did he give away all his money, where does he live now, does he have any income, where does the 1300 come from, how often do they take that from him. Is he claiming any benefits like pension, pension credit, attendance allowance. Was the plan for him to sell up, give money away to avoid paying carecosts. Lastly if he is unsafe with health problems have social services and his gp been involved in a free care needs and capacity assessment. Does he havecapacity to make decisions and what poa do they have,

Did they declare the money as income? Did he run a payroll? Or were they just helping themselves?

Are you worried about deprivation of assets? The 7 year rule only applies to inheritance tax, there’s no limit for deprivation of assets, so in theory if they’re looking at council funded nursing homes it could be considered that he sold his home and gave the money away to avoid care homes fees, and therefore would be ineligible.

Where's the rest of the money from his house sale

Did they make adaptations to their homes for him to live with them?

If so, he’s paid for his care for the last ten years by making adaptions to the properties he lives in and paying carers/rent/keep.

I don’t think I’d call that deprivation of assets. It wasn’t done to avoid paying for nursing homes, it was done to provide care for ten years.

This is a case of deprivation of assets (which is different from the 7 year rule which only applies to IHT). Yes they may have to pay some of the money back to fund his care.

Gave away 10 yrs ago. His income is pension and attendance allowance, they take the money by standing order every month. They have full poa, he doesn’t have any capacity now.

SS have been involved just to check on care I think. I think the assessment is what my parents are planning on doing next.

He gave it to his kids

Yes big adaptions and have cared brilliantly for him for 10 yrs with no other help

This is what they say and I do agree but don’t know if they’ve broke rules

The gifted amount is high - £50k? I thought you could only legally gift a sum of £3k without paying tax? I don't know how they would police it over 10 years ago though.

Where does he live now. He needs a full care assessment so that a suitable carehome can be found. Do they have financial and the welfare poa.

He lives between my mum and dads house and my aunt and uncles house and yes my dad and aunt have both types of poa

Potentially unwise or naive yes, given the Parkinson’s diagnosis it was reasonable to think he’d need care (whether at home, or by way or nursing home) at some stage in life, especially when it seems he’s given away the majority of his assets.
The best to hope for now is to document the £650 payments properly - whether that means your dad & aunt registering as carers, and then taking it as salary etc.
Also, your dad & aunt having POA doesn’t mean they can do anything they like financially - there’s applicable rules depending where you live, but simplistically they shouldn’t be doing anything that your grandad would reasonably / prudently have done had he had capacity.

edited following OP comments re grandad living between dad & aunt’s houses and paying for adaptions in house. Perhaps a good idea to document all this, so it can be demonstrated clearly if asked, the same story the first time by everyone.

This, plus deprivation of assets is within 6 months of needing state care which he hasn't used/doesn't need because of the amendments he has paid for.

Try a different way of looking at it, do the math and see how it looks then-

If he had moved into a retirement/care home ten years ago, how much money would he have spent on that? He would have been entitled to do that, had he wished. That wouldn’t have been deprivation of assets. No one says you have to spend wisely, just that you can’t spend with the deliberate intent of running out of money.

If what he has done cost less than a retirement home then I can’t see the issue.

Your numbers aren’t entirely clear, so can’t help with the maths!

Thank you. Is this an actual rule?

This is there take on it but I worry that it still isn’t legal what they have done. They don’t have much themselves.

I don't think you have done anything wrong but ultimately it will be up to The Council to decide if it was deprivation of assets.
When my Mum was diagnosed with Parkinsons around 15 years before she died she looked at putting her house in Trust or similar but her Solicitor told her that as she had a diagnosis that would be likely to lead to her needing care she was on dodgy ground. She actually died as we started to think she would need to be moved into a care home having had Carers mostly paid for by The Council for about 5 years

£1200x52 =£62400 per year for residential, not specialist nursing, care.

so £624,000 for ten years. Has he given away more than that, in up front cash or £650 payments?

I've just googled and it actually said the 6 month rule changed in 2014 and LA's can go back as far as they like. I can't see how that can be legally workable though; if you sent your kids to an expensive school and then couldn't work for example, they could argue that 50 years ago you could have afforded it had you made a different choice?

I think 10 years is long enough though and it would not be hard to say he would have spent more than the money on personalised care in that time.

No I get it to about £200k. Thanks