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Author Topic: Will dilemma, wonder how others feel  (Read 736 times)

Offline RandomGuy99

  Spot on Doc re talking to family members ....We had a few deaths that caused divy up troubles and we are now going though the paying for carehome situation with a distant familly member this has made the remaining ones ( im getting close to it  :lol: :lol: ) have a good think and they have started to give to Children and Grandchildren to avoid to 7 year rule plus they are giving regular out of income which is outside the seven year provision ...Items are being brought and 2 are having rather good house extensions paid for this also is also an attempt to  get in the 7 year rule. they understand that what they thought they might pass on will go in care home fees so their home will be swallowed up ...DONT THINK oh it will go for top price the local authoriy if you dont have the carehome cash take an order on property and at end of life that is fire (quickly) sold at Auction, a realitives 3 kids saw their home sold for a little more than third of what it would of got.   :( :( :( The Older I get the more unfair stuff I see  :(   It takes a confident and loved person who trusts family to talk candidly and openly about Death and Cash I hope ive the strenght to do it and the familly members to help when i need to ... :hi:
I know a few people who have split the ownership of their house, so some of their family members own a share. That reduced the person's ownership of the property to a lower level and thus there's less for the local council to go after should they ever need to go into care.

Offline Doc Holliday

I know a few people who have split the ownership of their house, so some of their family members own a share. That reduced the person's ownership of the property to a lower level and thus there's less for the local council to go after should they ever need to go into care.

A couple may split ownership but if ownership is split with other family members and the sole intention is to avoid the payment of care home fees, the council will interpret this as a “deliberate deprivation of assets”. It can then place a charge against the property so that care fees are repaid when the property is sold. Unlike the 7 year Inheritance tax rule there is no time limit on this and the local authority can go back as far as they like.

As Greydave says 7 year rule can be very useful in Inheritance tax planning but should be planned with specialist input. It is always a gamble though as you simply cannot guarantee someone living 7 years.
« Last Edit: March 25, 2024, 09:55:29 am by Doc Holliday »

Offline RandomGuy99

A couple may split ownership but if ownership is split with other family members and the sole intention is to avoid the payment of care home fees, the council will interpret this as a “deliberate deprivation of assets”. It can then place a charge against the property so that care fees are repaid when the property is sold. Unlike the 7 year Inheritance tax rule there is no time limit on this and the local authority can go back as far as they like.

As Greydave says 7 year rule can be very useful in Inheritance tax planning but should be planned with specialist input. It is always a gamble though as you simply cannot guarantee someone living 7 years.
They did it about 10 years ago and they're unlikely to need care for another 15 years, so I think they'll be ok.

Offline Doc Holliday

They did it about 10 years ago and they're unlikely to need care for another 15 years, so I think they'll be ok.

Makes no difference, unless the legislation changes over those coming years. At the time of the house sale (whenever that should be) and if care fees need to be recouped, the local Authority will ascertain the property has joint owners and want to know why?

Oh and you can never predict accurately when someone will need care.

Offline PilotMan

I think we have veered slightly off of what the OP originally intended, but in a good way. And maybe the experiences others have shared on here do actually help the OP get a perspective.

Many of the experiences reported on here are similar to my own experience.

My mother passed away in 2022, and it's only last week that we have received the Grant of Probate. Her will was written in 2011, along with the granting of the Power of Attorney. She was diagnosed with Dementia a few years later. I made sure that we consulted and got Doctors letters as her condition deteriorated, so the Power of Attorney evolved accordingly. I had little involvement in writing the will, she was a bit old school and money was never openly discussed in our household. One thing I can see now, is that if there had been any changes in family members circumstances. i.e. if myself or one of my siblings had passed away, there was no specific provision for that in the will.

My Father, passed away some time ago. In his later years he was suffering from what I can only describe as an (undiagnosed) early type of dementia, he would forget things, get easily confused and repeat things over and over, typical of many people in old age. I knew he had a Will and that I was an equal beneficiary, along with my two siblings. His best friend and his Solicitor were the executors. There was no family rift (that I was aware of), and I visited my Father almost weekly.

The Will was (without my knowledge) changed by my brother, who between him and his wife changed the will to their benefit, and became the Executors. The amount involved was significant, but wouldn't be life changing for me, and not really for them either as far as I could tell at that time. After I got a copy of the Will, it became obvious to me, that their aloof behaviour (Brother and Wife) was deliberate (all but eliminating contact with me). It had been going on subtly for several years, it baffled me as to why they kept their distance.

I asked for a copy of the will, my request was refused. My Fathers house was sold and everything was cashed in. I just got a cheque in the post (which was the residual balance of the Estate and a copy of the will) - the contents of the will and how it came about were a revelation to me. I then asked for previous copies of the will, and from that I could see the pattern of changes in the distributions, these came about after my father was in an early state of dementia. Because dementia was undiagnosed (and deliberately, so as there to not let the Will be contested) the Will couldn't be challenged for that reason. Something I subsequently learned, is that the Executors acted incorrectly (they said under the advice of the Solicitor), because a residual beneficiary is entitled to see the Will before any distributions are made.

I have found that with many "professional advisors" (Solicitors in this case), rely on their "god" like status to never be challenged and what they are doing is correct and follows all the correct, rules, laws and protocols. The way I deal with professional advisers now is that I check everything for myself, quite frequently they get things wrong. With age, experience and wisdom behind me, I no longer take what I am being told as verbatim. When engaging with a Professional I make it clear from the beginning that I expect them to check everything thoroughly and comprehensively, because I will. Even so, they still make mistakes, or they fail to act promptly or thoroughly.

So I would advise anyone in need of getting a Will for themselves or a family member, to check everything, don't take what a professional advisor says as verbatim, do your own due diligence. Think of every possibility of changes in family dynamics and relationships, even death of a beneficiary. Check what the laws of intestacy say and think about how they might be applied if the Will no longer stands as it was originally intended by the benefactor.

I never had a Solicitor talk to me about any of these permutations.

Offline PilotMan

Makes no difference, unless the legislation changes over those coming years. At the time of the house sale (whenever that should be) and if care fees need to be recouped, the local Authority will ascertain the property has joint owners and want to know why?

Oh and you can never predict accurately when someone will need care.

Yep, the in-laws have just learnt that. You can't just hide or re-distribute someone's assets, in order to get free care provision.

I'm not sure if the 7 year rule applies to local authority fees, that rule I believe is about inheritance tax and may not have a bearing on how the local authority view it.

Also, as far as I am aware, if you "try" to redistribute ownership (outside of marriage, of any asset to anyone at anytime), you would have to show that it was a genuine transaction for a real "bargain" and not just on paper. The person still living in the house paid would also have to pay a fair market rent in proportion to the beneficial owners.

Not a ruse that should be taken without specialist professional advice.