Care home fees paid by family member

[Jim71]

Hi,

I am the sole beneficiary of my mother's Will. Thankfully mother is currently still with us, but is sadly now in hospital. Staff have advised me that she may require a nursing home on eventual discharge. Whilst she has sufficient assets to self-fund such care, I can foresee a situation arising where she may be too unwell to sign the nursing home's direct debit mandate or settle fees directly.

No Power of Attorney (POA) exists and, even if she were able to sign the necessary POA forms now, I understand it would still take several months to process and so does not provide a solution.

Thankfully I do have sufficient funds to settle mother's nursing home fees myself, out of my own monies. Being the sole beneficiary of my mother's Will, am I right in thinking that this approach (paying the nursing home fees myself) would be cost-neutral and therefore a sensible solution? Crucially, would the nursing home fees be regarded by HMRC as a debt on mother's Estate and hence deductible from the value of her Estate for Inheritance Tax (IHT) purposes? Or would I potentially be taxed at 40% to get my own money back?

I am not sure whether the answer to my question is straightforward, or whether it might depend on quirks such as the exact wording of her Will and, perhaps, whether the nursing home invoices are addressed to her or to myself?

Thank you for any information!

[PallasAthena]

I suspect that unless you have a formal contract drawn up the payment by you of your mother's nursing home fees is likely to be considered a gift within the family from you to your mother and not a debt of the Estate.

See what others think.

If she has mental capacity now then putting a LPA in place asap might be best, even if it does take a couple of months to come through and you had to fund it in the meantime (which you could easily do as a loan to be reimbursed when the LPA was registered).. Does your mother have enough in cash to pay her fees or would you soon need to sell property?

[Jim71]

Thank you Pallas Athena

In answer to your question, I can confirm that mother has sufficient cash to pay her fees, i.e. there would be no imminent need to sell property.

[Pezza54]

OPG currently stating up to 20 weeks to register a LPA. Definitely worth putting a LPA in place, costs about £80
My FIL spent 2 years in a nursing home. Make sure you claim all the allowances, the nursing home should advise you and your mother what is available

If your mother is in a care home when you need to sell the property you may require LPA to sell it

[ButWhatIf?]

If you mother has capacity and ability to sign the LPAs, ask her to sign the direct debit (with her own bank details) for the care home costs, as soon as she knows (whilst she's in hospital) where she will be going. Thisis likely to happen before the LPAs come through.