COVID-19 Business Update - Click for more

Protecting assets against care home fees

It is estimated that one in four of us will be living in a care home during the final years of our life.  Despite this knowledge, very few of us consider the financial implications until it is too late.  Care home fees can cost on average £36,000 per year and if you have been prudent and managed to save for your later years, own your own home or have savings, it is likely that you will be liable to pay for these fees yourself.  In a short amount of time these hard earned savings will be eroded so there is very little left for your children to inherit.

Many couples do not realise that they may be able to safeguard at least half the value of their property simply by changing the way they own their homes combined with having an effective Will.

Most couples own their property as ‘joint tenants’ which means that on either of their deaths the property passes automatically to the survivor.  The survivor then owns the whole property and should they need to go into a care home, the whole value could be used to pay their fees.  By changing the ownership to ‘tenants-in-common’, the first spouse to die could bequeath their share to whoever they like, perhaps their children or into a trust so that the survivor has the right to continue living in the property for life, then if the survivor were to need to go into a care home, they could only be assessed as owning a half share of the property to pay their fees.  This effectively safeguards a half share of the property for the next generation.

Obviously, legal advice should be taken before transferring any assets, not only to ensure that they give effect to your wishes, but also to ensure they do not fall foul of the Deprivation of Assets Legislation.  This legislation allows local authorities to recover assets that have been deliberately disposed of to avoid paying care fees.

We can provide the advice and guidance you need to effectively protect your assets.  Please contact our team on 0113 320 5000.

Latest Blog

Furlough and carrots

Furlough and carrots
The Chancellor Rishi Sunak recently announced an incentive for employers to retain furloughed employees if they remain employed until at least the end of January 2021.  Employers will receive...
Reintroduction of employment tribunal fees?

In a surprising announcement, the Ministry of Justice (MOJ) has confirmed that it may reintroduce fees for employment tribunal claims.  This would be a surprising U-turn by the government which was criticised for its tribunal fee structure which was introduced in 2013.  The fee structure was decl

Inheritance tax changes

The recent Budget saw the Chancellor announce reforms to Inheritance Tax rules which were widely expected following the Conservative Party’s General Election victory.  Currently, a married couple are able to access allowances of £325,000 each, which can be doubled up and applied as a single allow

Grandmother with Grandchild

The Prime Minister David Cameron has recently suggested that he would be “happy” to look at plans for so called “granny leave” giving working grandparents the right to take up to 18 weeks of shared paren