On a related point, I wonder if I might have comments on the likelihood of the court approving a proposal if application is made providing adequate supporting information?
In my case, the deputy is one of two daughters of the patient, the other having died last year leaving an infant child which the deputy, herself a divorcee with two minor children, has taken on as guardian. Deputy is a working woman in her forties, does not have a great deal of money - not enough to buy a house or put a worthwhile deposit on one on which she could then have a mortgage that she could service.
Mother (the patient), an elderly lady in her 80’s, resides with her sister (in her 90s) who is financially able to look after the patient. It’s a permanent arrangement or at least, set for the foreseeable future. If the caring sister were to die, there would be adequate provision for the patient under her Will.
The patient has about £600,000 on deposit, doing very little, itself a worry and unsatisfactory having been like that since the deputy was appointed 3-4 years ago. The deputy knows that she should invest etc.
The deputy asks: can she buy a property with the patient’s money, in the patient’s name for the use of the deputy at a market rent, in which to reside with the patient’s grandchildren?
It makes sense to do this on most if not all grounds. Payment of rent by the deputy has to be made to a third party otherwise. The cash will depreciate if left as it is and probably do no better in investments than in bricks and mortar. The acquisition of real property for this purpose would seem a not unwise investment decision in the circumstances and also a good idea for the family unit as a whole: after all, the patient’s estate (she is probably intestate) will pass to the deputy and her grandchild (son of the deceased child), all of whom would therefore benefit from this arrangement in the short and long term.
The tax consequences are no worse than any other arrangement. And maybe, the patient spending little if anything on herself, it would be possible for the deputy to be permitted to reside at a reduced rent and the gift element be covered by normal expenditure out of income.
Apologies for the length of this question. Comments would be gratefully received. Maybe the answer is obvious but I haven’t met the question before so forbearance would also be appreciated.