Changes are due to be made to the Fair Deal Scheme regarding how business and farm assets will be treated. As a result, calculating Fair Deal contributions have stuttered, as more questions are being raised about the proposed change.
Under the current regime, farm families and small business owners are required to set aside 7.5% of the value of the farm/family business assets. This is done annually to fund a place in a nursing home. Minister for Older Persons, Jim Daly has brought forward a proposal to cap this cost at 3 years. This will give farmland and business assets the same status as the family home. The proposed move was raised after farming bodies (IFA) lobbied for years, claiming that the existing system is a major obstacle to young people taking over the family farm.
Jim Daly’s new changes stated, “the limit will only apply if the land is farmed by a close relative”. Land that is leased to third parties will be counted as a normal asset.”
As such a new person debating about going into a nursing home now when care has been deemed as being necessary or waiting for a change in the law, should, by all means, apply immediately for the Fair Deal scheme. The minister has clearly said there will be a “retrospective aspect to the legislation”. If a person enters a nursing home they have to pay 7.5% of the value of their assets for a 3-year period. After the 3-year period, they will no longer make a payment in relation to the value of the farm/small business assets. There is no financial benefit to anyone delaying the decision to go into a nursing home and more importantly there is no financial penalty to progressing their Fair Deal application immediately.
Why people should not delay their application process…
- Firstly, once a person is approved for Fair Deal, they have 6 weeks to accept their chosen bed. If the person does not do so, their bed will be made available to the next person on the waiting list. That person then has up to 6-month period to reactivate their application and if they fail to do so they must start the whole application process all over again.
- If a family does not have a plan in place, they could be looking at the situation where they are faced with discharging someone from a hospital where they pay nothing. This means putting them into a nursing home where the cheapest rate could be between €1,300 and €1,400 a week. Furthermore, until the Fair Deal is approved, they’ll be a private resident and the family will have to fund that.
- The average waiting time for an application to be processed is 6-8 weeks depending on where you live. The application process can then be delayed if the relevant additional information is not readily and accurately available to support the application.
There are organisations that can help you with this; fairdealadvisors.ie is one. Call us on 01-556-3500 for more information and find out how we can help you.