Change of circumstances - caring for partner advice

[shedofdread]

Hello everyone

I am going to have to give up my business to look after my partner for the next couple of years. I'm starting another business which I can do from home, but by my reckoning neither of us will have a reliable income for the next three years.

We live in a nice detached house, and we have a not so nice one bedroom flat.

I have floated the idea of turning the house into an airbnb for a couple of years. My partner really doesn't like this; she is scared of moving back into the flat and wants to sell it. I am worried that we won't have enough income to afford our bills if we keep the house.

We have cleared all our mortgages, but I have spent almost all of my savings on building works at the house. The costs of fixing it up have gone up tremendously because of a bad builder and unexpected work, but it's nearly there, like 95% there.

My partner's illness really came out of the blue and I thought I would be able to build my savings back up again as my business gave me a reasonable income until recently. More fool me.

I get that she doesn't want to move back to the flat but am very frustrated with my partner's attitude that we can carry on living here without an income. She isn't well enough to have a proper discussion about this at the minute.

What would you do? We'd get about £80k for the flat, or £1000 a month (best guess after costs and comparing to local properties at 40% occupancy) for the house on Airbnb. How long can we both survive on £80k? Other than that, we sell the house. It is probably worth £400k. It's so galling to have lived in a building site for seven years, only to have to sell it.

I hope this doesn't come across as feeling too sorry for myself; I accept that we're lucky in that owning two properties and no debts is not a bad position to be in. But I am pretty lost.

Can’t you rent the flat? Look into PIP and carers allowance for your wife / caring for your wife?

Rent the flat out I mean.

That sounds really tough. I'm sorry that your partner is ill. Are you sure that giving up work is the only option? Could you pay for some help at home or work more flexibly as a short term compromise to keep your long term income?

Don't sell the house. You e just got it done and your partner doesn't want to live in the flat.

Can you rent the flat out? A nice longer term let?

It all sucks, doesn't it? It's hard being a carer, so the only other thing I'll add is that maybe having something to do a couple of days a week might be just what you need.

@Bagelsandbrie it has not been an easy thing to let the flat out. The last tenant owes us £10,500 and took two years to evict.

It isn't a nice location and although we got it at a very low price I wish we'd never bought it. I should have done different things with the money.

@reallyworriedjobhunter thanks for your kind message. My business involves spending much of the week in London and it's really untenable these days. The business is basically over.

£80k without mortgage expenses would fund about 7 years of regular household expenses for me, including a cheapo holiday. It's about cutting your cloth accordingly op, nobody but you knows what your expenses/lifestyle expectations are.

If dp is expected to recover, I'd say don't sell your family home but cut back as hard as you can on everything, life is going to be a bit of a struggle for you both over the next couple of years, but you said there will be some wfh income, plus if you sell the flat some income from that.

Morning OP,

Will the flat be subject to capital gains tax as a second home sale and have you factored that in to any lump sum?

What benefits is your partner entitled to as someone who is too ill to work? And what support can you get financially for caring when it becomes a full time job.

Another thing to think about is the cost of heating a large home (if there is just two Of
You) and you are at home all day. The cost of running the flat might be cheaper.

You are doing the right thing and are thinking ahead and making a plan and not burying your head which is really admirable.

Are there are any compromises. Live in the completed house for six
Months/one year and enjoy it. Then move into flat and trial air bnb. Or actually-can you live in the house and only move into the flat for a few days at a time each time you get an air bnb booking? Once you know the air bnb might take off. Could you sell the flat. And rent somewhere small but nice your partner might be happy with until you can move back into your house.

There are so many fully work from home jobs these days. Is there nothing you can do whilst caring for partner? Or with the support of some additional carers?

Could you try a tenant in the flat one last time? Or at least talk it through with a lettings agency.

@jackiebenimble the house belongs to me and the flat to my partner. She was a council tenant when we met and I was living on a narrowboat - I gave her the proceeds of the sale from my boat which meant she could buy it outright and I moved in with her. So as I understand things there won't be CGT to think about.

I have put the numbers into a benefits calculator and there is no entitlement for either of us. I kind of think this is fair enough in one way - there are plenty more desperate than us.

The cost of heating a large home is one worry. Access up a really steep path is another. There are still so many unknowns. Things were just difficult six weeks ago.

It's a big stress. But we will find a way. Thank you for your supportive message. x

Your partner may be eligible for PIP if she has difficulties with mobility and everyday living activities such as cooking a meal, washing and dressing herself etc. If she has worked in the past 2-3 years and paid NI contributions then she can look at claiming New style ESA. Both of these are not means tested. If PIP is awarded then you can claim carers allowance also. You will not be eligible as a couple to claim means tested benefits if you have a second property with equity over 16k. If reasonable measures are being taken to sell it then it may be disregarded as capital but that decision would need to be made by a Universal credit decision maker.

If the flat has been rented out at any point there may be capital gains tax due on the sale

Could you adapt your current business or sell it to someone else?

[quote shedofdread]@jackiebenimble the house belongs to me and the flat to my partner. She was a council tenant when we met and I was living on a narrowboat - I gave her the proceeds of the sale from my boat which meant she could buy it outright and I moved in with her. So as I understand things there won't be CGT to think about.

I have put the numbers into a benefits calculator and there is no entitlement for either of us. I kind of think this is fair enough in one way - there are plenty more desperate than us.

The cost of heating a large home is one worry. Access up a really steep path is another. There are still so many unknowns. Things were just difficult six weeks ago.

It's a big stress. But we will find a way. Thank you for your supportive message. x[/quote]
Does she claim PIP ? The calculator will only show no entitlement to means tested benefits which PIP is not.

@BritInUS1

If the flat has been rented out at any point there may be capital gains tax due on the sale

Could you adapt your current business or sell it to someone else?

No. She is instrumental to its running. The business is over. Amazing how quick it all happened.

If there's tax to pay, we'll have to pay it.

Bugger.

Capital gains tax is only payable on the increase in value (I think) so how much you have to pay depends how much the flat has increased in value.

I would stay in the house if you possibly can. Between PIP and the flat sale and any income you make that should help? Being ill somewhere "not nice" is horrible.