.................

Take out a £30k loan against it instead.
Invest that £30k in premium Bonds in 6x £5k blocks.
You'll be loaded by Christmas. :thumbsup:

From my understanding, your parents could put a property in trust for you. As long as neither of them died within 7 years of the creation of a trust, you would not pay inheritence tax. However, trust law does not, I believe, apply to occupied property.

Even if it does, Social Services are legally obliged to recover costs of care home provision, and I believe can undertake a legal charge on the property. This applies even where one partner is admitted to a care home, and the other partner remains at home. Upon the death of the latter, Social Services can then recover their costs through a forced legal sale of the property.

The exception to the rule is where the property is occupied by a relative who requires the accommodation. There is numerous case law on this matter. In one such case, quite a few years ago now, a son returned from South Africa to live and care for an aged parent. The elderly parent was eventualy admitted to a care home. The local Social Services department was successful in getting the son evicted, and forcing a sale of the home, as they we able to demonstrate that the son did not need the parental home as his primary residence.

All sorts of ploys have been tried to avoid care home costs being charged to the property - but I think you will find that all loopholes and wheezes, including trust funds, have been closed.

This is quite an interesting subject. I don't really know too much about it, but my parents are concerned that their property will be absorbed by the cost of their care. Even though they have looked after me well through the years, they didn't manage to put a trust fund together. Basically, their home is everything. I know it upsets them to think that the property might not go into the care of my brother and I.

I suppose it's not the the end of the world as it's not like I deserve to have the house just because I'm their son. And I'd like to be comfortable by my own means by the time this becomes an issue.

Originally posted by redrobbo
Even if it does, Social Services are legally obliged to recover costs of care home provision, ...In one such case, quite a few years ago now, a son returned from South Africa to live and care for an aged parent. The elderly parent was eventualy admitted to a care home. The local Social Services department was successful in getting the son evicted, and forcing a sale of the home, as they we able to demonstrate that the son did not need the parental home as his primary residence.

My god. What kind of country do we live in?
Is it just me?

How can we have come to a position like this? It seems that we live in a country where the most productive citizens become the most disadvantaged in their later years:

My Grandma had a small nest egg built up because she worked bloody hard and sacrificed today's spending for tomorrow's savings simply to be able to pass something on.

Now she is in a nursing home, and had to sign consent that allowed solicitors to take charge of her financial affairs (otherwise no nursing).

The solicitor and the nursing home are currently in the process of spending her (small) wealth between themselves. Just because she had the gall to be frugal in her prime.

I know you are interested in views and facts about the subject Spook, but when I first read your post I felt aghast. That we are reduced to seeing our parent's belongings and wealth as future contributions to the tax man and the private care business. Where's the dignity?

Deavon :-

Agree wholeheartedly with your sentiments. It's just one of the many ways in which the indigenous people of this country feel they are treated badly.
The irony is that this country could not afford to be so generous to all and sundry who have contributed nothing , as yet , if it hadn't been for people like your Grandma who helped this place to prosper in the first instance.
I'm amazed , really that both main political parties still get voted in and I feel sure that none of the minority parties would be able to change things. The whole thing has gone too far.
What it really needs is a revolutionary new party , with fresh values and one which would actually listen to and do what the majority of people in Britain want.
Now that would be revolutionary !

Originally posted by Fareast
Deavon :-

Agree wholeheartedly with your sentiments. It's just one of the many ways in which the indigenous people of this country feel they are treated badly.

Mmm what do you mean by indigenous???

The dictionary definition is Native; produced, growing, or living, naturally in a country or climate; not exotic; not imported.

I think the rules apply to everyone living in our fair land, regardless of where they were originally born... if that is what you are getting at.

I used to deal with this kind of thing when I was a legal secretary, and the rules then were that, so long as neither of the owners died within seven years of the trust being set up, then the house may become exempt from inheritance tax and/or capital gains tax.

However, I seem to remember hearing earlier this year (not sure if it was in the Budget, or before) that this has varied slightly, and that the person for whom the house is in trust must be an occupier.

I think that you and your parents should take proper legal advice from a property and trust solicitor, independently from each other.

Originally posted by redrobbo
From my understanding, your parents could put a property in trust for you. As long as neither of them died within 7 years of the creation of a trust, you would not pay inheritence tax. However, trust law does not, I believe, apply to occupied property.



I believe that this government has changed the law so that this is no longer the case and whats more they have made the legislation retrospective (for how many years back I'm not sure).

Originally posted by Mo
I believe that this government has changed the law so that this is no longer the case and whats more they have made the legislation retrospective (for how many years back I'm not sure). I thinkthe last change affected passing you house to your children/a trust then continuing to live in it rent free. The IR will now assess the rent you should be paying and count it as taxable income. And you're right, I think it was retrospective, but I don't know how far back. I think it may cover all such arrangements whenever made.

Originally posted by Fareast
Deavon :-

Agree wholeheartedly with your sentiments. It's just one of the many ways in which the indigenous people of this country feel they are treated badly.
The irony is that this country could not afford to be so generous to all and sundry who have contributed nothing , as yet , if it hadn't been for people like your Grandma who helped this place to prosper in the first instance.
I'm amazed , really that both main political parties still get voted in and I feel sure that none of the minority parties would be able to change things. The whole thing has gone too far.
What it really needs is a revolutionary new party , with fresh values and one which would actually listen to and do what the majority of people in Britain want.
Now that would be revolutionary !

Totally agree too. What kind of message does this send out -spend your whole life working to provide for yourself and family so as not to be a burden on the state: and be robbed in old age. Or do nothing and still be well cared for.

Why is it always productive citizens that have to lose out - people that have often contributed the most, already, to the welfare state?

Please don't take this as Gospel,but my understanding of this situation, is that if one parent goes into a care home and the other parent is still living in the house, they can't be forced to sell to pay for care, also if there's a son/daughter with special needs,and they have always lived in the home again they can't be forced to sell,I have no special knowledge on this,but my situation would fit this criteria, it has been my experience that to get anything from this Government or the last lot, you have to fight tooth and nail, it doesn't come easy and no one tells you about what you're entitled to,I'm the carer and of two disabled people and I'm 60, when I was 59, I could claim carers allowance, the day after, obviously I'm still doing the same job, I can't, this is a very sore point with carers in general, because even at best you had to give at least 35 hours a week to caring and for that you got £43.00 which works out at just over £1.00 and hour, or in my case 50p an hour as I care for two, but back to your posting I also know that when we made our will, the solicitor split our deeds which i think offers some protection.

You may find more info on here:-
http://www.ace.org.uk/AgeConcern/index.htm
At the moment I am looking into equity release,any one experience of this?

Equity release is a good idea if you're old and are sitting on a house that you bought for a few thou many years ago.

BUT (and this is a big but) the house will almost certainly have to be sold when the homeowners die in order to raise sufficient funds to pay off the debt. I believe this would also apply if you tried to move.

As for trusts, as far as I am aware the main use of these is to get out of inheritance tax - you can "gift" a possession (say a house for example), and if you survive for 7 years it is not considered part of your estate, and so isn't considered for IHT.

However, there is a clause in it where if you are still "enjoying the benefits" of that asset (ie still living in the house even though it belongs in trust to someone else) then this is taken into account. I'm not sure how exactly - i haven't got my books to hand but I can find out if you do really need to know.

Originally posted by Saifa
Equity release is a good idea if you're old and are sitting on a house that you bought for a few thou many years ago.


and if there is no family to leave it to