Surrey Homes | SH23 | September 2016 | Education supplement inside

Concerned about your
home being sold to
fund your future
care fees?
ADVERTISEMENT FEATURE
The Issue
You probably own your home as joint tenants if you are a couple and solely
if you are single. For couples this means you own it wholly, jointly and
severally. Ultimately therefore you do not own it 50:50 as you might have
assumed. You actually own all of it together and when one partner dies the
surviving partner owns it solely and absolutely.
It is sole and absolute ownership that enables a whole property to be taken
into consideration as an asset by the local authority and puts the property
in danger of needing to be sold to fund care.
The Reality Today
The care Act 2014 introduced in April 2015 allows local authorities to
assess your assets to determine if you need to pay for your own care under
the new charges and assessment of resources regulations.
Currently if you have assets above £23,250, you are on your own and
require care, you will probably have to pay for it all - currently averaging
around £1,000 per week.
Savings, cash and income would be used first and then your property
would need to be taken into consideration. You would be expected to pay
for all of your care until such time as your assets were depleted to below the
£23,250 threshold.
You would then pay for a proportion of your care until your assets were
below £14,250 - at which point all your future care would be paid for after
any relevant income was taken into account.
The Solution
For couples, simply by changing the way you own your property well in
advance of any care considerations i.e. from joint tenants to tenants in
common and by setting up two property Trusts either immediately or
within a properly structured Will at the same time in most cases, protect
the integrity of your home should you ever require care in the future, so
long as avoiding care fees was not a primary motivating reason behind the
implementation of the strategy - i.e. you should be looking to protect your
half of your property should your spouse remarry after your death, or you
should be looking to ensure that your children would not lose 50% of their
inheritance should they be made bankrupt or divorce or for example you
should be looking to prevent a generational inheritance tax burden in the
future. These are all sound reasons for implementing this strategy which in
themselves are not deliberate deprivation of assets, but the implementation
of which protects the integrity of the property.
For sole owners the process is simply to set up a Trust now and convey
your property into it which will produce the same result and again this
must be well in advance of any care considerations and the motivation
must not solely be for the purpose of preventing your home being used to
fund your care.
The Reasoning
When you own your home as tenants in common you actually own half
each. With our Post Death Property Protection Package when the first
partner dies, they leave their half into their Trust. The surviving partner
is the Trustee of that Trust and also the Primary Beneficiary which means
that as they own half and are Trustee of the other half they have complete
control over the property and what happens to it. The children and/or
whoever else is also nominated as ultimate Trust Beneficiaries will have
access to that half of the property when the surviving partner dies. The
first half of the property then is 100% securely in Trust for the beneficiaries
and will not be at risk. As a result of this simple strategy and because it is
not possible to sell just the survivor’s half of the property, the integrity of
the property is protected. While the ‘’market value” of half a property is
negligible, The Care Act 2014 guidelines do allow for this half to have a
charge placed on it under a deferred payment arrangement for care fees
which is why this package includes a Lasting Power of Attorney grant for
Property and Financial affairs which will enable a pre-appointed Attorney
to act on behalf of the survivor should they be unable to themselves and
negotiate with the Local Authority for the property to be rented out and a
percentage of the income given to the Local Authority instead of a charge
being placed. The second half of the property would then ultimately go
into the Trust for access by the nominated beneficiaries when the surviving
partner eventually dies.
With our Whole of Life and Post Death Complete Property and Family
Protection Package both halves of the property are conveyed into Trust
IMMEDIATELY. This means the whole property is protected straight
away and not just after the first party dies. The benefits of this package are
that it then protects the property even if both parties go into care before
the death of either. It also means that if the survivor goes into care the
property does not have to be rented out but if it is, 100% of the income goes
directly into the Trusts for the benefit of the survivor or any of the other
Trust Beneficiaries and does not have to be given to the Local Authority.
The most important benefit of this package though is the property can be
sold at any time and the resulting proceeds be fully protected for the whole
family within the Trusts and no negotiation with the Local Authority is
required.
Sole owners and couples who have immediately conveyed their properties
into Trust well in advance of any care consideration and not solely
for the purpose of preventing their home being used to fund their care
(deliberate deprivation of assets) secures the integrity of the property (so
long as entry into care is not within 6 months of setting up the strategy)
as the property is not absolutely owned by an individual anymore and it is
not legal to force a Trustee to do something that is not in the ultimate best
interest of the Trust Beneficiaries.
Call us now for a friendly chat about which package would be of best
benefit to you and your family.
ALDERSHOT: 01252 246170
CAMBERLEY: 01276 423175
CRAWLEY: 01293 270745
DORKING: 01306 898522
EAST GRINSTEAD: 01342 459034
GUILDFORD: 01483 346772
HASLEMERE: 01428 288491
HAYWARDS HEATH: 01252 246170
HORSHAM: 01403 541244
LEATHERHEAD: 01372 879984
OXTED: 01883 818286
REDHILL: 01737 669404
WESTERHAM: 01959 928474
WEYBRIDGE: 01932 910771
www.thywill.co.uk
THE OLD PARLOUR, UNIT 6, OCKLEY COURT FARM, COLES LANE, OCKLEY, SURREY RH5 5LS, UK
www.iggi.co.uk | T: 01306 712262 | E: info@iggi.co.uk