1. Expert Q&A: Benefits - Weds 23 October, 3-4pm

    Our next expert Q&A will be on the topic of benefits. It will be hosted by Lauren from our Knowledge Services team. She'll be answering your questions on Wednesday 23 October between 3-4pm.

    You can either post your question >here< or email them to us at talkingpoint@alzheimers.org.uk and we'll be happy to ask them on your behalf.

Should I worry?

Discussion in 'Legal and financial issues' started by Liz57, Jan 19, 2015.

  1. Liz57

    Liz57 Registered User

    Dec 22, 2013
    184
    I'm desperately trying to get my mother's situation sorted out and know she'll be self funding for whatever care we eventually end up with for a few years at least before involving social services. At 87 and in not great health, it's not beyond the realms of probability that she'll never need local authority support. Long before her diagnosis and indeed long before any real signs of dementia, my mother starting supporting my daughter at university and has been paying her a small sum each week to help with her living expenses as I wasn't able to after my husband died. My daughter has one more year of her four year course to run but is getting worried that when her nan has to go into a care home, social services will decide the payments are/were a deprivation of assets and she'll have to repay the money.

    Is this likely do you think?
     
  2. Beate

    Beate Registered User

    May 21, 2014
    11,715
    Female
    London
    I wouldn't worry too much about small sums that have clearly started while she was still compos mentis. Even after a dementia diagnosis gifts that have been ongoing and are not excessive are allowed. Have you got LPA for her?
     
  3. nitram

    nitram Registered User

    Apr 6, 2011
    19,038
    Male
    North Manchester
    I would not worry too much either.
    I the LA decided that it was deliberate deprivation of capital which occurred more than 6 months before the assessment rather than ask you daughter to repay, they would most likely add the amount as virtual capital to the actual capital when doing the assessment.

    Note that the upper limit is scheduled to increase from £23,250 to £118,000 in April 2016 when the Care Act 2014 is fully implemented. This is not the only funding reform to come into force at that date.

    https://www.gov.uk/government/uploa.../file/366086/Factsheet_6_-_Funding_reform.pdf
     
  4. Kevinl

    Kevinl Registered User

    Aug 24, 2013
    4,783
    Salford
    Unless you have POA then you really can't stop the payments and until you do it's still your mother that is doing the giving. As the arraignment has been in place for some years then I can't see what they can object to, certainly I can't see how they could expect it to be repaid. If as you say it may never get to the point where the SS are involved I'd forget it and as Nitram says they wouldn't go for repayment they'd adjust it put of your Mum's capital.
    K
     
  5. Norfolkgirl

    Norfolkgirl Account Closed

    Jul 18, 2012
    514
    http://www.lawsociety.org.uk/support-services/advice/practice-notes/gifts-of-assets/

    See particularly final paragraph
    3.1.1 Why the client is considering a gift

    You should ask why your client has decided to make the gift, as you may be able to suggest more effective ways of achieving the same objective, for example: does your client wish to ensure that a particular person inherits an asset? This objective could be achieved simply by making a will.

    Other points to consider could be:
    • Is your client seeking peace of mind by making the gift? Do they think it provides certainty for the future or satisfies a moral obligation?
    • Will the gift affect others who might have expected to eventually inherit a share of the asset?

    If the intention in making the gift is to avoid tax, you should ensure that your client is aware of all tax implications, including Inheritance Tax, Capital Gains Tax and Pre-Owned Asset Tax. There are additional considerations if your client retains the benefit of an asset after giving it away. For instance, if the recipient of the gift dies before the donor, the asset may be subject to Inheritance Tax.

    If your client is seeking relief from the worry and responsibility of owning an asset, granting a lasting power of attorney to a family member may be a better way of dealing with this issue.

    If your client wants to avoid the value of their assets being taken into account for means testing, such as when they foresee the need to pay for long-term care, your advice must deal with the consequences of such an action, including tax implications and the risks in relation to deprivation of assets.
     

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