Funding long term care

A wealthy client, again a solicitor introduction, had to enter a nursing home, and despite the extent of available capital needed above all the peace of mind that would come from knowing that whatever might happen in future to inflation, and in consequence to nursing home fees, the client would never have to move from that nursing home.

We were able to persuade the nursing home to agree that if the client purchased an annuity, set up both to be paid direct to the nursing home (and thus saving tax), and to increase at a guaranteed rate per annum, the nursing home would accept the risk that their fees generally might have to be increased at a higher rate than this amount, and so guaranteed not to increase the fees payable by our client. The cost of the arrangement was mitigated by the consequent reduction in the client’s potential inheritance tax liability.