Established Pattern of Giving Not an Attempt to Escape Care Costs
20th March 2018Back to articles
When care costs need to be met, simply giving away your money is not a strategy that normally meets with success, as the local authority is likely to contest such arrangements when calculating what it should contribute towards the costs.
In a recent case, a local council refused to meet the cost of an elderly woman's care home fees when it learned that she had given sums of money to her family while in the home. In its view, this had been a deliberate attempt to avoid paying the costs herself.
When she was admitted to the home following a stroke in 2007, she had assets of approximately £250,000. Currently, anyone with assets of over £23,500 has to pay the full cost of their care.
Seven years later, the woman's assets were depleted to the extent that her family applied for assistance from the council, which instituted a financial means assessment process to determine her eligibility for support. The council began paying for her care on a provisional basis pending the finalisation of the assessment.
In the course of the assessment process, it was revealed that she had given away an average of about £1,000 per month. She claimed that this had been recommended to her by an independent financial adviser and it was something she had done for some time prior to her stroke.
The council took the view that she had intentionally deprived herself of the capital needed to pay for her care and demanded repayment of the £7,000 it had paid up to that point. It also stopped paying her care home fees.
The Local Government and Social Care Ombudsman concluded that the council had decided without good cause that the woman's gifts represented the intentional dissipation of her capital.
The existence of an established pattern of giving before she went into the home was a key finding.
Andrew Eddy, Head of Private Client says "Taking professional advice early can represent the difference between leaving your estate to your loved ones and having it reduced by care home costs or Inheritance Tax. We can advise you on all legal issues relating to the elderly."
For information and advice contact us at of any offices below:
Devizes – 01380 722311
Marlborough – 01672 518620
Chippenham – 01249 478333