My mother, who requires 24-hour care, wishes to give her house to my sister. My sister, aged 58, is registered disabled herself but has for the last three years plus, managed to do a sterling job of care, helped not least by the fact that until recently, she was a senior nurse. This has saved a fortune in care home fees, previously running in excess of £40,000 p.a. It is clear that without my sister's support, my mother's limited quality of life would be even more grim.
After the gift, my mother would be required to pay my sister rent. As mother is doubly incontinent and occupies and uses only one room at all times, save for occasional use of the toilet outside her room, it is intended to charge £4,250 p.a., which my sister will claim under the Rent-a-Room provisions.
My sister has asked me to find out what is the IHT position. She has been advised that there is a tax break by virtue of her being my mother's carer.
Comments as to the viability of the gift from an IHT standpoint would be appreciated.