Estate Planning and Dementia Tax
The dementia tax is the term that has been coined to describe how people pay for care. It is an area of huge legal complexity and is ripe for change, except that there are no easy (or cheap) ways to make the changes. We have a rapidly aging population and the cost of the state paying for people’s care is unaffordable.
Currently, there are a number of organisations selling packages known as ‘asset protection trusts’, ‘property protection trusts’ or ‘family protection trusts’. Quite often, these organisations are unregulated and simply offer a ‘solution’ to having to pay for care.
We have seen a lot of these, both locally and further afield, and one of the main problems with them is that they do not take into account the wide variety of factors involved. Everybody’s circumstances are different and people have many differing attitudes towards care and what they want for their families and themselves. Unfortunately, these packages are sometimes sold without full advice as to all the pros and cons being explained, with incorrect advice (i.e. that there are no tax consequences or that it will make the estate easier to deal with after you die) being given, and with little back up being provided if they are later challenged, which is happening more and more as local authorities become more strapped for cash. They are also, quite often, sold for a lot more than well rounded, experienced and regulated advice on the same area of law would be.
Planning for the possibility of going into care should be a part of your financial and estate planning, along with looking at inheritance tax, making Wills and Lasting Powers of Attorney, and organising your estate; but there is no simple, ‘one size fits all’ approach that will magically mean that you will never have to pay care fees. There are lots of options available and you need to be advised about the ones that best suit your personal circumstances.
Chris Milne has over 20 years’ experience in advising on these matters and has seen all sorts of changes to the care industry in that time. As a full, accredited, member of Solicitors For the Elderly, with the Older Client Care in Practice award, he is well placed to help you look at the whole picture and provide you with the best advice. Contact him on 01630 652405 or email@example.com