Protect your Home from the Cost of Care Fees with a Protective Property Trust for Couples

If you or your partner require care in later life, then your property may be at risk of being used to pay for these care fees. There are legal steps that you can take to prevent the Local Authority from taking your home and at Farsight Wills we specialise in ensuring that you and your family are protected against such an eventuality.

Couples who have made standard Mirror Wills (or don’t have Wills) could unintentionally be gifting their home to the Local Authority. You should act now to protect your children’s inheritance with a Protective Property Trust.

What is a Protective Property Trust?

In simple terms, a Protective Property Trust is where (as a couple) you each write Wills leaving your half share of the property in trust for the children or other beneficiaries but state that they cannot inherit the share while your surviving partner is alive. That half of the house is then safe from Care Cost Fees.

Why do I need one?

Should you or your partner require care in later life, your assets will be means-tested by the Local Authority to help pay for these services. This goes back to the Community Care Act of 1990, which came into force in 1993.

The Local Authority will seek to use the assets of a person, including the family home until they are reduced to £23,250. At this point, the Local Authority will contribute towards the person’s care costs. The person’s assets will be used further until reaching a lower limit of £14,250 at which point (in theory) the Local Authority will take over paying the fees.

What does this mean?

If, for example, you are not protected by a Protective Property Trust and either you or your partner passes away, the full value of the house will be used in any means test calculation that they perform thus reducing any potential inheritance for your surviving family.

How does it work?

If you own your house jointly then the good news is that there are some legal steps you can take now to protect your hard-earned assets.

Forget the myths you may have heard. There is no seven-year rule and the government cannot change Protective Property Trusts. It also means you remain in control. Crucially, the house remains yours during your lifetime. However, you must act now, whilst you are both alive and well.

We do not recommended that you transfer the house to the children during your lifetime as the Local Authority would most probably deem this a ‘deprivation’ of assets and ignore the transfer.

Farsight Wills can show you the correct approach to take ensuring that you always remain in control. Talk to us today about Protective Property Trusts on 01793 433705 or request our free info pack for further details.

6 replies
  1. Jenny Keown
    Jenny Keown says:

    My husband and I are very interested in organising this sort of Will but have been told we need to change the ownership of our property to tenants in common. Is this true?

    Reply
    • Nigel Schofield
      Nigel Schofield says:

      Hello Jenny.

      If you and your husband currently own your home as Joint Tenants then it is correct that it will need to be changed to Tenants in Common. We can check all that at the meeting and if it needs changing we can organise that for you, it is all included in our fixed price.

      If you need any further information please feel free to contact me on 01793 433705 or email info@farsightwills.com

      Kind regards

      Nigel Schofield MIPW

      Reply
    • Nigel Schofield
      Nigel Schofield says:

      Hello Valerie,

      As the sole owner of a property you are not able to shield your home from care fees as this would be seen as deliberate deprivation if you were to need long term care in the future. There are trust options open to you but not the Protective Property Trust as this will only apply to couples that own a property together.

      If you would like me to go through your options I would be more than happy to do so.

      Kind regards

      Nigel Schofield MIPW

      Reply

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