Assets that aren’t accessible / not cash or house

[rickyrickygrimes]

I was having a conversation with my dad this weekend about ageing, care, assets etc (we are quite open in our family about finances, wills etc) and the topic of paying for residential care came up. In addition to their home and savings / pensions income etc, my parents own part of a farm. It is owned jointly with my aunt, and possibly her children. It’s not something that can be divided or sold easily in the way a house can. They don’t get any income from it, but they do get lump sums every now and then when land is sold off - which is very occasional.

how are these kind of assets treated in financial assessments?

Depends slightly on if their ownership is of land or of the actual business partnership or both but actually the top and bottom of it is that a farm business/land as an asset is treated exactly the same for local authority financial assessments as if it were cash in the bank or a property that could be sold.

This is one of the occasions where they need to get specialist advice, yesterday.

However depending on age/frailty I would be looking to pass things on to the next generation as far as possible if the main intention is to keep the farm in one piece.

If the priority is for your parents to get their fair share then again - the sooner there are conversations about what that looks like the better for the sake of family relations.

If the farm is profitable (ha) and could afford to pay £4-6k a month in care fees for several years worst case scenario then you don't need to do anything.

(Social Worker in a rural area)

They'd really need to get legal and financial advice from professionals who are expert in agriculture properties. It's a complex area of law/tax.

Most likely a deferred payment https://www.payingforcare.org/taking-out-a-deferred-payment-agreement/

It’s most definitely not profitable in farming terms and they have never taken a rent or any kind of income from it. My 80 yr old aunt lives alone in the crumbling farmhouse, I think my cousin (who has a farm of his own elsewhere) occasionally uses some of the fields, but it’s not profitable in itself. If there is a business entity, my parents are not involved. A lot of land has already been sold for housing. My aunt will never pass her share on before death, my parents are reluctant to ‘burden’ us with a complicated situation (and to disturb what has, until now, been a favourable tax status of the land). But I’ll be encouraging them to check it all out.

Deferred payment - can that be lodged against a jointly-owned asset? Ie part owned by someone other than my parents? No individual actually has any control over when or if it would be sold, and that’s the only time that any money is generated from it. They don’t own individual ‘bits’ as I understand - it’s all jointly owned by all of them.

We are in Scotland btw.

I'm also in Scotland and my elderly parents are in a farming partnership along with my elderly aunt and uncle. As I've already said, you really do need to seek specialist advice on this one. Going by my own experience of disentangling my parents' property from the firm's - a mess was made of it 30 and 20 years ago - it is not likely to be straightforward!

In terms of my DF's financing of his nursing home - the only focus has been on his own personal funds which so far have been sufficient to pay the fees. I don't actually know what would happen if they run out - whether attention would turn to the firm and the farm.

You need advice - like yesterday!