Clare McLeish of Coodes Solicitors warns of the pitfalls of transferring money to a family member in an attempt to avoid care home fees. Sign in to your account. Organising your care. That’s £5,250 each. The leaflet claims that 45,000 families are forced to sell their homes every year, to pay for care. We are both in our 70s. A nursing home costs more than £40,000 a year. Contact your local authority and ask for a copy of their formal complaints procedure and contact details for the Local Government Monitoring Officer. I can sell my home, or other assets, for less than their true value to avoid deprivation rules. It may not leave much for your family to inherit. Avoiding paying Care home fees. It could be tempting to give away or sell your house to relatives to avoid the fees to avoid paying the full cost of care. Stephen spent this money to be closer to his family, not to avoid paying for care. In the South East, it is £10,000 a year more than that, according to consultants LaingBuisson. Whether you need some help at home, or want to find out more about Care Homes in your area, our Finding Care tool can help. Our top tips for finding the best quality care can also help. The cost of care is rising at a record rate, with the average room in a care home now costing over £33,000 a year. The local authority can assess her income based on Joan receiving £150 a week. The first jab was given to a nurse in New York, kicking off the largest vaccination in US history. "We've got a social care crisis on our hands now, a local authority funding crisis, so they're using every possible means to get money in. That’s £9,000 less than the £14,250 allowance. It isn’t necessary for you to have legal representation, but you can if you wish to. So you're taking away the catastrophic element and I think then the avoidance industry would find things much tougher.". To continue to get out to see her family, she spends £8,000 on a second-hand car adapted for wheelchair users. If you are over the age of 65, there is a 50% chance that you will need to pay for long-term care at some point in the future. When you're ready to start looking at types of care, you can start by asking friends and family for any services or care homes they would recommend, or search online. If you’re not sure whether your choices could be considered as deprivation, it’s a good idea to get legal or financial advice from a specialist before you go ahead. First Covid vaccine given in US as roll-out begins, Fighting the 'stigma' of dementia in Asian families. This means the person who needs care would only need to spend £1,750 rather than £26,750 before you’re entitled to funding support. False: Some companies advertise these trusts as a guaranteed way for you to avoid paying for care, but this isn’t true. If the council thinks that you have done this to avoid paying care fees they may still assess you as if you still had the money or property that you have given away. Arranging care in later life is expensive. Free trial. Mark lives in England, which means he’s allowed to keep £14,250 in savings. He never did pay care fees because his treatment was covered by the NHS. Paying for care home fees completely out of your own pocket is expensive and some people have to sell their homes to afford long-term residential or nursing care. Christine spent this money to keep her independence, not to avoid paying for care. These are just examples and, of course, every case is different. It means the local authority can treat you as though you’re receiving this money. When it comes to a care funding assessment, gifts of any amount outside your usual pattern of spending can be considered depriving yourself of asset. Joan has a pension worth £40,000. Which is why marketing leaflets from a will-writing firm called Universal Wealth Preservation are eye-catching. Potential customers might therefore be wise to ask searching questions of their own, or to take advice from a solicitor before signing up. In a number of recent cases the clients in question had attended seminars held by companies promoting the use of “Asset Protection Trusts” or “Wealth Preservation Trusts” and were sceptical that the advice they had received sounded too good to be true. Care at home There are a number of factors that can affect how much you pay for personal care and it can vary depending on the provider. To access this resource, sign up for a free trial of Practical Law. In England, if your assets (including your home, providing that no-one else is living there) are worth £23,250 or more, you will usually have to pay the full cost of care home fees. Each country in the UK allows you some savings that don’t count in your financial assessment. .css-14iz86j-BoldText{font-weight:bold;}Care from the NHS is free, but if you need social care because you're physically or mentally frail, you have to pay for it yourself. Next Last. Moving to a new home better suited to your needs. This is why it’s increasingly common to protect all your assets beforehand and understand how to avoid selling your house if and when you go into care. Economist Andrew Dilnot, the chair of the commission that first proposed the care fee cap in 2011, says a cap would remove the fear generated by a means test he describes as the "most pernicious" in Britain. The expenses associated with receiving care in a nursing home, however, can prove financially disastrous for the patient's family. Paying for Care Homes using Trust Funds. © 2020 BBC. The council must tell you how much they think your care will cost. "Universal said they could protect the house from care home fees, and he thought that would be a good thing to do.". Share any evidence you have, like bank statements and receipts that show your pattern of usual spending existed before you knew you’d need care. They may be able to help you with Power of Attorney and Deputyship. The main ways to avoid paying full care home fees. Deprivation of Assets is treated on a case by case basis by local authorities. It is no surprise then that people may consider drastic steps to avoid paying for care. Jul 28, 2017 #1 We are in the process of selling Mums house to pay her care home fees. If you want to avoid being surprised by rising nursing home care costs and have the ability to pay for your care… Stephen’s needs more care than he used to, and his home isn’t suitable for him anymore. "I'm not saying that these products would not in certain circumstances work, if you were seeking to part with ownership of a property when you're fit and healthy, when there's no prospect whatever that you're going to go into a home.". No one likes to pay tax unnecessarily, but handing over money simply to avoid tax – particularly inheritance tax – may cause more problems than it solves. On the other hand, I've got socialist views so it sounds ludicrous, but it's human nature to not want to sell the house. Sue wasn’t trying to avoid paying for care by spending this money, so it shouldn’t count against her application for help with care costs. This means that they don’t make any provisions financially in case they do need to access domiciliary or residential care in the future. "Don thought that if he had to go into a care home or nursing home that we would have to pay and we could lose the house," Susan recalls. Those kinds of … And the government has delayed the introduction of a £72,000 cap on the amount anyone has to pay towards their care. She’s the registered owner, but her children are insured as drivers to be able to take her out for trips. The figures were based on a survey of 165 care homes, together with official government statistics. Christine recently suffered a stroke, leaving her paralysed on one side of her body. So, after a home consultation with a Universal representative, the Steers signed up, paying Universal a fee of almost £4,000. Local authorities will often ask you to share bank statements going back months, years or even decades to help them decide if you’re entitled to financial help. You can continue your usual pattern of spending, but if you start giving away larger amounts than you have before, it would likely be seen as a deprivation. Stephen’s needs more care than he used to, and his home isn’t suitable for him anymore. Although this number varies geographically, it's a substantial amount. For example, Medicaid programs seek to recoup the amount the program spent on nursing home care from the patient or -- if the patient dies -- from her estate. They can ask for repayment up to the value of the assets they believe you’ve deprived yourself of. If Christine, from our third example, had bought a luxury car costing £80,000, then the local authority could suspect that a significant factor in this choice was an attempt to avoid this money being used to pay for care. To get the right care and support in place, asking your local authority for a free care assessment is a good place to start. 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This will be worked out through a combination of a care needs assessment and a means test. Read about our approach to external linking. Sue wasn’t trying to avoid paying for care by spending this money, so it shouldn’t count against her application for help with care costs. Universal is one of a number of firms offering such services. Keep your complaint focused on your motive and the timing of your decision to get rid of an asset. ", .css-1hlxxic-PromoLink:link{color:inherit;}.css-1hlxxic-PromoLink:visited{color:#696969;}.css-1hlxxic-PromoLink:link,.css-1hlxxic-PromoLink:visited{-webkit-text-decoration:none;text-decoration:none;}.css-1hlxxic-PromoLink:link:hover,.css-1hlxxic-PromoLink:visited:hover,.css-1hlxxic-PromoLink:link:focus,.css-1hlxxic-PromoLink:visited:focus{color:#B80000;-webkit-text-decoration:underline;text-decoration:underline;}.css-1hlxxic-PromoLink:link::after,.css-1hlxxic-PromoLink:visited::after{content:'';position:absolute;top:0;right:0;bottom:0;left:0;z-index:2;}First Covid vaccine given in US as roll-out begins. Otherwise, their share will go to the person needing care, and could then be used to pay for care. The latest figures show a place in a residential care home in the UK costs, on average, more than £30,000 a year. Our Finding Care tool can help you discover Care Home and Care-at-Home providers in your local area. But with the financial squeeze on local authorities growing, Mary Butler says, it's getting harder to slip such trusts under the radar. However, if you have what is called a ‘Primary Health Need’ there is funding available through the NHS called Continuing Healthcare (CHC) funding, which covers 100% of care fees for people aged 18 or over. The people who are looking at these forms are wise to the stunts that people pull.". It may still be considered as deprivation. As our population ages, the number of people requiring nursing home care increases each and every year. Your partner’s £25,000 won’t be included in any decision about your finances. The above are only examples of how a deprivation may be treated. Like Birthdays, Weddings or Religious Holidays. They won’t count savings up to £14,250, but they’ll expect his children to pay back the other £15,750 for his care. If you move an asset to someone else to avoid it being included in your financial assessment, the local authority can require them to pay for your care up to the value of that asset. You can decide how it should be spent as long as it’s used to meet the eligible needs in your agreed care plan. He decides to move to Surrey to be closer to his children, so they can see him and offer support more regularly. Sue and John live at home but recently, Sue has found it harder to get up and down stairs and to climb in and out of the bath. Don had just been diagnosed with a terminal cancer. False: Selling an asset for considerably less than its true value can be considered a deprivation. Even though they approach old age with mobility issues or memory loss, they delay considering residential care altogether. The leaflet claims that 45,000 families are forced to sell their homes every year, to pay for care. She’s chosen to receive £40 a week as income, but the maximum she could get is £150 a week. In 2018, average annual costs for a private room in a nursing home exceeded $100,000. What happens if you try to avoid paying for care, Retirement Interest Only Mortgage Calculator, Proof you used the money to repay any debts, A lump sum payment to someone else, for example as a gift. In 2013, Chris Grayling, then Lord Chancellor, turned down a recommendation from the legal industry and consumer groups that will-writing should be regulated. Already registered? You only qualify if your home, savings and investments are together worth less than £23,250. Almost all are unregulated, so customers have nowhere to complain if things go wrong. Such as expensive artwork or a new car. If you used to have an asset but you don’t own it anymore, you’ll need to prove this by giving some evidence to the local authority. Living in a home that is suited to your needs can help you to live safely and well at home for longer. Here, we explain everything you need to know. According to the annual Genworth Cost of Care Survey, in 2019, the median monthly cost of a semi-private room in a U.S. nursing home was $7,513. Mohammed lives in Northern Ireland, so he can keep £14,250 in savings that won’t be counted in a financial assessment. Similar to Notional Capital, this is where you have either given away your right to claim an income or haven’t applied for income you’re eligible for. Universal's scheme works by transferring the ownership of assets like a home or savings into what it calls a "Wealth Preservation Trust". Placing your property into a Trust can mean that it becomes a protected asset, so no-one can demand that your home is used in paying for care home fees. Possessions aren’t considered in the financial assessment but if you purchased them to ‘hide’ your money, it could be considered a deprivation. Practical Law Resource ID a-023-4384 ... Is there any reason why a deed of variation should not be used to save benefits from social services, eg care home fees? Some relatives of pensioners are hiding their parents' full wealth to avoid paying care home fees and many local authorities are failing to use the available legal powers to claw the money back. There is financial help from local authorities, but it is strictly means-tested. But knowing all your options could help to save you money. The local authority should respond within six months, but often it’s quicker. If the local authority doesn’t change its decision, they’ll explain how to take your complaint to the Care Ombudsman. If trusts are genuinely set up for reasons other than avoiding care fees, Mary Butler, the senior partner of solicitors Bell Buxton, says they may succeed in avoiding care fees as well. Avoid paying care home fees with Compass Continuing Healthcare. He has £30,000 in savings but gives £10,000 to each of his three children. There’s no limit to how far a local authority can look back to search for any financial gifts you’ve given. "If people are trying to protect their house in the avoidance of care fees then that's not allowed; that is a clear deprivation of assets. Knowing what care you need and how to find it isn’t always easy. He’s paying his own care costs and moving into a care home. If the need for care is primarily a health need then there is funding available via the NHS that meets the cost of paying for care home … Care home fees will vary depending on the area, the individual care home itself, plus your own personal financial circumstances. Removal of the fear of the financial catastrophe would also reduce the moral dilemma care fees now pose for people like Susan Steer. You may think about giving away some of your savings, income or property to avoid paying likely care costs, and to give something to your relatives or charity, for example. Free Practical Law trial. Care home fees can range anywhere from around £30,000 to £60,000 per year depending on individual needs and preferences and the level of care required. "I don't like the rule about having to sell to pay for care home fees. Universal says its representative wasn't told the Steers' main goal was protecting the family home from care fees. According to Bridgette Shilton, chair of the National Association of Financial Assessment Officers, if avoiding care fees is a substantial motive for putting assets into a trust, then a local authority can challenge it as "deliberate deprivation". As well as your motives and the timing, your local authority will consider whether your financial choices are in proportion. The house is in the name of my wife and myself. 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