Great care should be taken with this style of arrangement as they are often ‘sold’ by companies to individuals who are looking to avoid paying for care fees.
Typically, the idea is to take your home as your major asset and transfer this into a Trust that you no longer own. By completing this transfer, the theory suggests that this asset can no longer be taken into consideration in the Local Authority means test assessment and that you could therefore qualify for funding of your care fees.
As we said take great care here, if a Local Authority discovers that you have transferred the property into a Trust to avoid paying care fees, this will be classed as ‘asset deprivation’. In such circumstances the Local Authority has a wide range of powers and they can treat you as if you still own the property and bill you accordingly.
So, can you legitimately protect your home from care fees?
Well in brief the answer is yes! It requires that you sever the joint tenancy of your home so that you and your spouse or civil partner own your home as tenants in common – this may sound complicated, but again we can help you here! You then need to rewrite your Will to incorporate a Trust for your own share of the property and then your partner will be granted a life interest in your share of the property after your death.
In the future, should your partner need care then any care fees would be taken from their own share of the property and not the share that is held in the Trust. The Trust element will be held for the future beneficiaries of your Estate and so will not be taken into consideration in funding your partner’s long term care costs.
This is the correct way of planning, once again we can provide you with all the advice and guidance that you would need.
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