You can give it away. Where avoiding care charges was a significant motivation, the council can assess you as if you still owned it, or recover the charges from the person you gave it to, up to the value they received.
The advisers for this subject: Sunny Bharj and Tony Springer
Paying off a debt is not deprivation, even one that was not yet due.
The council looks at whether avoiding care charges was a significant motivation in the timing of the gift, and whether you could reasonably have expected to need care and to pay towards it when you made it.
A gift made while you were fit and healthy, with no reason to foresee needing care, should not be treated as deprivation. It is for you to show that you no longer have the asset, with a deed of gift, a trust deed or receipts.
The council assesses you as if you still owned it, as notional capital.
They become liable for the difference between what the council would have charged you and what it did, up to the benefit they received.
As a last resort the council can recover the debt through the county court.
Annex E of the statutory guidance sets no period after which a gift stops counting for care fees.
No. Seven years is the inheritance tax rule. For care fees the council looks at why and when you gave the asset away, and the guidance sets no time limit.
Yes. The guidance says people should be able to spend the money they have saved as they wish. Spending that is sudden and out of character, close to needing care, can be looked at as deprivation.
A trust that cannot be revoked is one of the examples of deprivation in the statutory guidance. The council applies the same test of motivation and timing.
The council asks whether you could reasonably have expected to need care when you gave it. A gift made while you were fit and healthy should not be treated as deprivation.
Gifts to family are an inheritance tax decision and a care decision at once. We can look at both before anything changes hands.
Independent Financial Adviser
Independent Financial Adviser
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