I have been asked many, many times about ways of protecting assets, particularly the family home, from the future possibility of payment of nursing home fees. I know that it is a real worry for many people. I do not think people can be criticised for ‘” wanting to leave something to my children after I have gone”.
Of course, that brings with it many extraneous thoughts, which need to be carefully considered.
I know that, for many people, the general answer is to gift the house to children, so that if and when a move into a care home seems necessary, the home is not owned by the future resident of the care home and, therefore, not a part of estate or assets when a financial assessment is carried out. Unfortunately, this is not always the case and the very transfer itself can cause problems. It is not as straightforward as one might think and not without its own difficulties. Other people talk of creating a ‘property trust’. This too needs careful consideration and professional advice specifically tailored to your needs and situation.
Whenever anyone goes into a care home (unless the resident is in receipt of NHS funding, which generally means all care costs are paid by the NHS) a financial assessment must be carried out. If that resident’s capital exceeds, currently in Wales £50,000 (and that includes the value of the home) then full care fees would be paid by that resident.
There are financial products that can be considered and put in place to assist with the payment of the care fees. There are also certain investments which, if in place before the financial assessment takes place, would be precluded from any assessment of care home fees. What must be carefully considered, if perhaps a gift of assets is considered to children during lifetime, is whether it would be viewed as a deprivation of assets (that is, the deliberate giving away of assets or sale of assets at a considerable undervalue to evade the payment of, in this case, care home fees). In such an instance, the asset, even though gifted away, is still regarded as a part of the resident’s assets and included within the financial assessment regarding the payment of care fees.
The most important thing is to take clear advice from a suitably qualified professional, in particular a solicitor, and consider all of the options that are available to you, pertinent to your particular circumstances. Of course, everyone’s situation is different and a “one solution fits all” is certainly not the correct one.
Here at Martyn Prowel Solicitors we can certainly advise you on the options available and can discuss matters with an independent Financial Adviser, should that be necessary. We offer a one-off consultation fee of £200 plus the VAT, if this is an option suitable for your needs. Please do not hesitate to contact the office and speak to Natalie Harvey on 02920 470909.