Unless you have some expertise with this area, I would be wary of offering advice. This is a specialist area, and a specialist is what you need. Throwing advice out on such a sensitive and potentially financially significant area without understanding the subtleties could cause them and ultimately you, to lose more. I just googled inheritance tax specialists in ireland and this was the first link: smartfinance.ie/html/inheritancetax.html, dont have a clue about them, but this is the kind of thing I would be looking to the pro’s for.
Do they have an accountant do their tax returns? Despite the fact that they have no mortgages on the rental property and therefore can’t write off interest against rent I am surprised to hear that all of their rental income goes in tax.
Over 65s and particularly over 70s have very generous additional tax reliefs (far too generous in the opinion of missed off thirtysomething moi!) and are they availing of all of these? It would be worth seeking processional advice even on a once off basis to check this. The accountant could also advise on your inheritance issues.
In addition, based on my experience of dealing with my parents’ finances I think it would be worth seeking advice from a paid professional advisor regarding their current financial situation. I found that my parents had also lost a lot of their (v modest) savings in the bust due to the fact that they don’t keep on top of letters from the banks etc, and also they insist on buying far too much insurance (eg. V expensive life insurance policy even though they have no mortgage and no dependents) and keep paying for policies they took out in the 1980s. I find they won’t listen to advice from me on this issue but they did listen to a professional.
Very first thing to arrange si power of attorney - it doesn’t have to be invoked for years, but it should be in place in the event on any issues which are staistically more likely to occur as parents get older.
I think you ought to probably wait until they bring issues up relating to financial affairs and succession planning and then work through them with them and a suitably qualified advisor. Then they will feel in control since they initiated.
I am in favour of (enduring) power of attorneys but slapping one in front them uninvited or shuttling them to sign assets over etc is likely to scare them.
I’d suggest you stay well away. As others here have said, get the parents to sit down in front of a professional. There are many of them out there.
The problems I have seen in this scenario are huge. When one family member starts to organise the parents, it can be the cause of huge resentment in families as someone will always feel “done” out of something which they never had.
There are loads of ways of planning for retirement/old age/death but it is a very complex area. You have CAT, CGT, income tax and stamp duty to contend with, so a detailed overview is necessary.
The first thing they should do is ensure their wills are up to date.
Easy now. I don’t think the OP was suggesting anything like that. It’s natural for people to worry about financial security in old age, and parents often worry about providing an inheritance for their kids, even when the kids mightn’t really need it… he/she was just asking how or if the subject should be broached.
I dealt with my parents on these issues a few years ago. I was the only family member in Ireland, my siblings were abroad. The issue came up because a friend of theirs had landed in an awful mess that divided their family. I took the opportunity to say that as I would be the one dealing with these things I would prefer if they sorted everything out. They agreed. I sourced a good solicitor who drew up their wills and the power of attorney docs. The finances I sorted out, in my case it was a number of bank accounts that in all had less than 20k. I closed accounts and put the money into an account that earned a decent interest and gave them access whenever they needed. They had no property other than the family home. I took things slowly but at the end of it all my mother said she was delighted that it was all done because she had ben worried about everything and didn’t know what to do. When my parents did pass away it was very easy to sort out the bits. Good luck.
In relation to fair deal I wouldn’t rely on it being in place or well funded into the future.