In the UK relatives are not held responsible for Care Home fees of a resident (although they have the option of paying top-up fees to upgrade provisions).
There is an argument however, that relatives are paying indirectly; since family property and heirlooms belonging to the resident may need to be sold to help pay for care before the local authority step in . It is therefore important to plan for the future and set up Asset Protection Trusts to ensure certain items can be protected.
Are ‘Asset Protection Trusts’ legal?
Asset Protection Trusts are a legal way to protect your assets from creditiors and to avoid the future complication of Probate. If that trust is established it can legally protect the assets from being sold to pay for Care Home fees. If however, an ‘Asset Protection Trust’ was rushed through as a response to someone needing to go into care this is not allowed and would be called a ‘Deprivation of Assets’, since it had been created purely to avoid paying for care.
If there were already health issues it is likely the trust could be seen as ‘deliberate deprivation’. Your local authority can use their discretion over what to include for assessment, which is why we suggest contacting us at Unity Legal on 01242 691441 and we will give you our best advice with a free 1 hour consultation.
Find out what the UK government have to say about Trusts.
Are ‘Asset Protection Trusts’ a good idea?
Asset Protection Trusts are the best weapon to have in your armory to protect your assets from creditors or lawsuits against your Estate. It is worthwhile investing in skilled professionals like Unity Legal to ensure it is written correctly and water-tight.
What are the disadvantages of an ‘Asset Protection Trust’?
If the Trust is not setup correctly it will not offer the level of protection required. Therefore the greatest disadvantage is the cost of paying professionals like Unity Legal to ensure it is properly established.
Is an ‘Asset Protection Trust’ the same as an ‘Irrevocable Trust’?
Asset Protection Trusts can be ‘Revocable’ or ‘Irrevocable’. In laymans terms a ‘Revocable Trust’ can be changed and amended fairly easily while an ‘Irrevocable Trust’ is not designed to be changed. If you would like further information, Unity Legal offer a free 1 hour consultation and we would be happy to discuss what would be appropriate to your situaltion. Call 03333 355875 to book.
Who should consider setting up an ‘Asset Protection Trust’?
Anyone aged over 18 and of sound-mind can set up an ‘Asset Protection Trust’ to ensure their assets are passed on to their chosen beneficiaries. We would always recommend you use professionals to ensure the trust is well-drafted.