In any other circumstance, 80pc of rental income is taken by the Government towards the cost of a person’s nursing home care.
The Housing For All plan will propose that the exemption for family members will be extended to rental income raised from any tenant staying in a person’s principle residence while they are in care.
That would be my reading of it. While the rental income might be excluded from the Fair Deal financial assessment, presumably the net rental income belongs to the nursing home resident and is taxable like any other income.How does this work for tax purposes - the house owner is the person in care, if FD aren't taking the income, it has to be taxed, right? The kids can't just pocket it, so as you say, unlikely to have much impact on the housing shortage - the hassle involved is unlikely to be worth it for the kids.
This has been talked about for a long time, I thought it would only apply to farms and businesses, not family homes, maybe that is not the case, I don’t know. This article explains the farmers grievance but also says;I'm more interested in this (from the same article):
"Legislation which imposed a three-year cap on annual contributions to Fair Deal from the sale of a family home was recently signed into law by President Michael D Higgins."
Anyone have more info?
I suspect the rent would be subject to income tax. Secondly the income is legally the nursing home patient and as such will form part of their estate when they pass away and as such the state can claim 22.5% of the value of the estate.How does this work for tax purposes - the house owner is the person in care, if FD aren't taking the income, it has to be taxed, right? The kids can't just pocket it, so as you say, unlikely to have much impact on the housing shortage - the hassle involved is unlikely to be worth it for the kids.
I understood 22.5% only applies to the asset value at point of entry to the scheme. For existing FD participants this is now fixed. The upside including rental profits is gravy.I suspect the rent would be subject to income tax. Secondly the income is legally the nursing home patient and as such will form part of their estate when they pass away and as such the state can claim 22.5% of the value of the estate.
I would have thought it was the value of the estate at the date of death. I don't know for definite but what happens if the value of the estate increases significantly either by increase in property value or if the patient themselves receive money.I understood 22.5% only applies to the asset value at point of entry to the scheme. For existing FD participants this is now fixed. The upside including rental profits is gravy.
I think you are misunderstanding the Fair Deal financial assessment. The state cannot claim 22.5% of the estate on death.Secondly the income is legally the nursing home patient and as such will form part of their estate when they pass away and as such the state can claim 22.5% of the value of the estate.
As far as I can recall it is the total value of the estate which excludes I think €36k of savings for a person and €72k for a couple.I think you are misunderstanding the Fair Deal financial assessment. The state cannot claim 22.5% of the estate on death.
You pay 7.5% of house value for 3 years only, you can pay this part weekly / monthly for the first 3 years or avail of the loan. If you avail of the loan and you live 3 years or more, then 22.5% will be owed on your death. But it will be 22.5% of the house value only (As declared in your application), and not any other assets that are in the estate.
Regardless of whether you avail of the loan or not, all Fair Deal clients must after disregards pay 7.5% of all other assets on a weekly / monthly basis for as long as they are in care, not just 3 years. This part of your contribution cannot be deferred.
Many don’t avail of the loan and owe nothing to Fair Deal on death even though they might have valuable estates.
I think if you looked into it a bit deeper you would find the state cannot take 22.5% of the estate on death. If the loan was availed of, it's possible up to 22.5% of the house value only could be owed.It's been a good while since I looked at it and did not go too deeply into it as it was not applicable to my family at the time.
It appears cash is included https://www2.hse.ie/services/fair-deal-scheme/financial-assessment-your-payment-towards-care.htmlI think if you looked into it a bit deeper you would find the state cannot take 22.5% of the estate on death. If the loan was availed of, it's possible up to 22.5% of the house value only could be owed.
Yes cash and all other assets are included in the financial assessment but the amount assessed on cash and other assets must be paid on a weekly / monthly basis and cannot be deferred.It appears cash is included https://www2.hse.ie/services/fair-deal-scheme/financial-assessment-your-payment-towards-care.html
Yes but do you agree the 2Yes cash and all other assets are included in the financial assessment but the amount assessed on cash and other assets must be paid on a weekly / monthly basis and cannot be deferred.
The state cannot take 22.5% of your estate on death.
Agreed but is the 22.5% calculated on the valuation of the house when entering the scheme ( my understanding) or on the valuation of the property on death ( assuming it's not sold in the meantime).?I think if you looked into it a bit deeper you would find the state cannot take 22.5% of the estate on death. If the loan was availed of, it's possible up to 22.5% of the house value only could be owed.
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