Holding/hiding savings.

Oh dear!
I don't understand why your BiL is involved in anything to do with your mothers assets, this clearly as nothing to do with him.
He is not doing his wife or your family any good by trying something which may turn out to be illegal.
If you have any concerns take the advice of a solicitor. There are many solicitors who will give 30 minutes of their time for free, I used one just recently. You just need to ring round and find out which ones do this.
Best if luck.

The seven year rule does NOT apply to LA assessments for care costs. If diddlyDis mother had given her assets away when she was 80, 12 years ago, if the LA deemed she had done this to avoid care costs, which would not be an unreasonable assumption, they would act as if she still had the money.

If mum clearly had 7 years to go before even thinking of entering a care home, the money distribution might work. She might even like that her ac would get this money instead of strangers. But at 92? It just doesn't make any sense. Bil is being hysterical and ridiculous. I'm glad you and sis aren't putting up with it.

IHT only applies with larger estates (£325K, or up to 750K if a deceased spouse didn't use their allowance), and now the addition of the Residence Nil Rate Band adds another 50 or 100K if a family home is part of the estate. If the estate is below this threshold, you don't pay tax on either lifetime gifts or inheritances.

But as has been pointed out above, this is a completely different issue from assessing a person's income for care home fees.

And IHT is not a tax on dying - 92% of estates do not pay IHT as they are below the threshold ( or on th3 fiddle of course)

These type of threads always end up muddling IHT and the LA rules for deprivation of assets. They are completely separate. As for the £3000 pa rule, the tax free bit means it is not included in the total amount of the estate for IHT purposes - if you give away more than that in the 7 years before dying, it will be included in the estate ( but the tax payable tapers between 3-7 years before death). LAs would only be interested in if they thought you gave it away deliberately to minimise your assets.

You can also give away as many small gifts as you like providing they are out of income. If nothing was given away in the last tax year you can give £6000 which won't be included in death duties (I refuse to call it IHT when it is actually a tax on dying!) If a child or grandchild is getting married then additional money can be given to them. Its £5000 to a child not so sure about a grandchild. Not sure though if the LA would say it has been given away to avoid care home fees.

Remember only £3000 of savings can be given tax free in any one year. You will all have to pay tax on money transferred from savings to you.

Many thanks for all interesting comments. One sis and I are aware of what the LA can delve in to as we thoroughly researched this when his scheme re putting mum's house in trust was raised.
We will meet with a solicitor so the other sis, wife of this BIL, will take on board and be told in no uncertain terms no more schemes please. This guy had actually changed mum's accounts to internet banking couple years back. Needless to say I told him to change back to how they were.

Local Authorities are well up with all the tricks that schemers like your BiL think up. They can, if necessary, get information from HMRC, who get information from all financial institutions in the country and will check whether your DM has had money in any saving account, which has now been closed and the money distributed.

Put simply if money has been given away or spent in order to avoid it being used to pay for care the LA will simply do the calculations as if she still had the money. At 92, it will be very difficult indeed to prove that money disposed of was NOT done with the intention of avoiding care fees.

I used to be a Case worker for a charity for the elderly. None of the schemes you BiL has thought up are originally, in fact they are the methods the majority of small time avoiders use. They do not work. The financial investigators in the LAs are well aware of them and will find them out.

I believe that cash and other monetary gifts would come under the 7 year rule, if mot then are included in the estate.

Does your mother still have full faculties to agree to do this (or not), or does he have authority to act on her behalf and close her savings account. Or are his ideas being presented for you and your siblings to follow his whims.

Does she have capacity? Does someone have power of attorney? She can give away whatever she wants but it may well be recouped by the LA to pay care expenses. Your BiL sounds a nightmare!

should have said mum is 92.