What You Need to Know
Planning for the future is something many of us take seriously, especially when it comes to protecting assets and providing for our loved ones. However, when it comes to long-term care, there is a fine line between legitimate estate planning and what is known as the deliberate deprivation of assets. Understanding this distinction is crucial, both for peace of mind and to ensure compliance with the law.
What Is Deliberate Deprivation?
Deliberate deprivation of assets occurs when someone intentionally reduces their assets in order to avoid them being used to pay for care costs. This could involve gifting money, transferring property to a relative, or converting assets into those that are exempt from means testing.
Local authorities carry out financial assessments to determine how much an individual should contribute toward their care. If they believe that assets were given away or otherwise disposed of to avoid care fees, they can treat those assets as if the person still owns them, a concept known as “notional capital.”
Common Examples
- Gifting property or large sums of money shortly before moving into care
- Selling assets below market value
- Transferring savings to a family member without a clear reason
The Timing Matters
One of the key elements local authorities consider is timing. If the disposal of assets took place at a time when the individual was fit and healthy with no foreseeable need for care, it is less likely to be viewed as deliberate deprivation. However, if care needs were already on the horizon, such actions could be scrutinised more closely.
Legal and Financial Consequences
If deliberate deprivation is established, the local authority can:
- Refuse to fund care costs until the notional value of the disposed assets is covered
- Pursue the recipient of the asset for payment toward care costs
This can place considerable stress on families who believed they were receiving gifts in good faith.
What Can You Do?
Estate planning is still advisable, but it must be approached carefully and with proper legal advice. At Harold G Walker Solicitors, we help clients:
- Understand the rules around care funding and asset thresholds
- Plan their estate in a way that aligns with current legislation
- Make informed decisions that protect both their assets and their family’s future
We recommend seeking professional advice as early as possible. With the right planning and guidance, it is possible to secure your future and avoid any unintended legal complications.
Need Advice?
If you’re concerned about care costs or have questions about estate planning, our experienced team at Harold G Walker is here to help. Contact us today to arrange a consultation and ensure your affairs are in order.
📞 01202 203200 📧 enquiries@hgwalker.co.uk 🌐 www.hgwalker.co.uk