What's this scheme called please

Sorry, Kate1949 but this is my pet hate. If somebody is living in the house, e.g. a partner who does not need care, and it's their house, then nobody is going to sell it from under them to pay for the other partner's care.

If nobody is living in the house and the reason for putting it in a "scheme" is to hide it from the people assessing your assets, so that you are able to leave it to whom you choose, to me, that's unethical.

I'm trying to sort out care for my elderly DF at the moment and I will use all of his assets, including the house he has lived in for 50 years, if it means we can get the right care for him. And we don't expect anyone else to pay for it while he's sitting on property.

Thank you.

There is a 'scheme' whereby you can put something in place which means you don't lose your home if you have to go into care.

No there isn't. There are a number of ways you can arrange ownership of your property, that can be advantageous for your family and avoid some inheritance tax, split your assets clearly into halves each of you clearly owning one half, but if you do anything that can be deemed as being done in order to avoid paying fees then the local authority or DSS can have it declared void.

Another 'wheeze' some people think will work is giving their house to their childre, now this has a number of drawbacks that I will not go into here, but the main one is that if after giving your house to someone (a child, grandchild) you continue to live there, you have to pay the person you gave it to the full market rent and the Inland Revenue will check every year and look for evidence you have actually paid it.

When I worked for Age Concern (as was) I had a client who had done this about 20 years previously (he was in his 90s) and the monthly market rent had risen so high, it exceeded his monthly pension.

AFAIK it is legal to leave your house to (eg) your children with the surviving spouse having a life interest in it, meaning that they can live there as if it belongs to them, but they have no financial interest in the property. If they die before going into care, the situation is as it would have been if the children had inherited in the 'normal' way, but if they are unlucky enough to need care, the house is not included in their assets to pay for it.

The morality of this is controversial. Some see it as deprivation of assets, but others see it as equalising a system where those who have deprived themselves of equivalent assets (ie earnings that have already been taxed) as they went through life, by having expensive holidays, cars and other costly lifestyle choices, and who are subsidised by people who have done without those things and saved or bought a house instead*.

A possible downside, however, is that with no house to sell if you do need care, you will be at the mercy of the LA, which may give you very limited choices when it comes to choosing a home.

*The fact that this is a very unequal country, and that many people work hard but have neither property, savings nor a lifetime of memories and holiday snaps is (IMO) very wrong, but is a separate issue.

Thank everyone. Our house is in both names.

Barneyoldbat, are you sure that was the best decision?

If the house is owned jointly none of it is taken into account if the husband or wife is still living there.

Obviously you got advice. It’s just we went into this three years ago when OH and I moved in together. Might it have changed since you set yours up. Or does the trust alter things?

We have done the same Barmey, I think it is what solicitors advise now.

X posts with others who may have answered your question.

Do you mean that if one person has to go into care, the other partner can remain in the house? Is there a charge on the property at any stage?

I'm not sure what the legal position is if the house is in one name only ie the person going into care.

Perhaps someone else will know.

It might be what Mr B and I did. First we changed our house deeds to becoming joint tenants. This means we each own a half share of our property and so we can in our wills leave our own share to whoever we want. If one of us went into care then the financial assessment will only take. Into account the 50% share of the house that you own. You don’t save paying all your fees but you do save 50%. We also both made wills leaving our share in Trust, to our son, so it continues should one of us die. See a solicitor who deals with inheritance and trusts. Easy to do and you can continue to live in your house or sell i and say downsize.

You can change the ownership of the house to tenants in common I believe it is called so they cannot sell the house if one of you is still living in it. I am sure someone who knows more will be along.

I think it may be the Deferred Payment Agreement. I believe you can also set up a property protection trust. You should be able to find details on the AgeUK website.

He might be talking about a trust. However, any action such as putting a property into a trust to try to prevent its value being taken into account when care fees are assessed will be classed as deliberate deprivation of assets and can be overturned, with care fees being assessed as though the transaction had not taken place. Quite rightly, or other care home residents are subsidising the one who has tried to 'get away with it'.

Well, I could say it’s called”Making other people pay for you”?

But I guess you mean putting a property in trust.