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AisaDirect Ltd, an Independent Financial Adviser authorised and regulated by the Financial Services Authority in the UK only.
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This website contains information which may or may not be applicableto your own situation and circumstances.
Any information or advice on this site does not constitute a personal recommendation. If you have any doubts as to whether a product or service is suitable for you, please seek independent advice.
LTC & Investment Bonds
There has been a briefing for the Charging For Residential Accommodation Guide which explains the interaction of care home, assessment of fees and investment bonds (2008).
The Briefing merely confirms that, in the latest issue of the Guide, the position of the treatment of investment bonds has been clarified so that where the investment bond is written as a policy of life assurance the value should not be taken into account as an assessable asset although any income or capital repayment paid from the bond will be assessable.
However it may be difficult to justify taking an investment bond immediately prior to an individual going into care.
Although it is stated that an investment bond is disregarded for the purposes of the assessment of an individual’s resources, it may still be taken into account if it is deemed that the primary motive of the investment is/was to reduce the individual’s assessable assets. Referred to as ‘deprivation of assets’.
If someone is about to or may be planning to go into care at a time in the future then the primary purpose and depravation of assets rules/guidelines are of major importance in advising on investments to be made and any investment decision should be supported by sound financial planning reasons set out in reason why letters.