Amphion

Can I avoid my home being sold to pay for care if I buy it with my son?

We would be tenants in common but am wondering if he would have to be living in the property for it to be excluded from means-testing.

A reader wants to ensure their son can live in their jointly owned property if they go into care.

Question

I do not have a partner. I want to purchase a property and hold it as tenants in common with my son to avoid my home being included in means-testing should I need to go into care in the future. As this arrangement seemingly works for married people will it work in my circumstances? And would my son have to live in the property?

If this arrangement would not work for single people then does that mean we are not being given the same rights and opportunities to pass on what we have worked for to our children as those living with a partner?

Answer

If it turns out that you do need to go into long-term care and you ask your local authority to arrange it for you, you will have to hope that they don’t trace the question you have emailed me. If your local authority did find it, they might reach the conclusion that you deliberately deprived yourself of an asset – by making your son joint owner of your property – to avoid having the value of your home included in the financial means test.

In 2016-17, if you have capital of more than £23,250, you are expected to meet the full cost of any long-term placement in a care home. Even if your local authority didn’t decide that you had taken avoidance action, it would still include the value of your half of the property. But rather than using the market value of the property divided by two, your local authority must base its value on the sale value of what’s called your “beneficial interest to a willing buyer”, which could make the valuation lower because finding a buyer willing to go into joint ownership with your son may be hard.

Even so, the value of your beneficial interest could exceed the £23,250 limit so owning your home jointly with your son still wouldn’t help.

Whether you owned it jointly or not, the value of your property would not be included in the means test if then moving into a care home you had a partner and the property was their home as well as yours. The value of your property would also be disregarded if it was the main home of a relative – including sons and daughters – over 60, whose permanent home it was.

Although you may find it unfair to single people, the disregard is intended to ensure that a home jointly resided in does not have to be sold if one of the residents has to go into care. So if the property was genuinely your son’s home and you lived together, and he was over 60 at the time you were means-tested, the value of the property would be disregarded. And provided that your other assets – including cash savings – did not come to more than £23,250 – you would be eligible for help with care home fees.

SOURCE: Virginia Wallis. The Guardian