Will I have to pay for my long-term care?

Many of us will eventually need, or choose, to move into a residential care setting. But who will pay the bill? Care fees expert Heledd Wyn sets out your rights.

Most people would prefer to remain and receive care in their own home irrespective of any physical or mental infirmity.

This is a principal objective of community care. However, in practice how much assistance you receive from your local authority social services department will depend on the extent of your need for services and their eligibility criteria.

Each local authority has different criteria. Commonly, many older people, their family and carers consider whether to move into a care home as an option.

Residential and nursing homes

Residential and nursing homes usually charge on a weekly basis. The fee will depend on the nature and level of care provided, the location and facilities of the home.

If you decide to move into a care home, important decisions need to be made. Such decisions may have unintended ramifications and taking specialist advice at an early stage can prevent or mitigate problems arising later, leaving you in the best position to plan your care.

If your assets exceed certain thresholds (which will depend on which part of the country you live in) then you will be required to pay for care.

Will any of my assets be disregarded?

The following may not be included in your overall ‘assets’ (but are not limited to):

  • Personal belongings, unless purchased with intention of reducing capital in the assessment (which would be considered as deliberate deprivation of assets);
  • Capital value of a life interest in land or trust fund (including personal injury trusts), for example, if a house is co-owned with a spouse/civil partner or child as tenants in common.; and/or
  • Certain financial products – getting independent financial advice on these is crucial.

How are savings considered?  

There is no right for the local authority to view the finances of a spouse or partner of someone going into care. However, if there is an account in joint names, they can see what the spouse or civil partner has. Means-tested care is based on the means of the individual needing care alone.

How is income considered?

Much of an individual’s income will go towards care fees, although certain income is disregarded including 50% of an occupational or personal pension – on the proviso that the other 50% goes to their spouse or civil partner.

When the local authority works out which assets should be used to pay towards care, how is the family home treated? Often the biggest capital asset, the value of the family home will be disregarded if:

  • the care placement is temporary;
  • the home is occupied by a spouse, partner, former partner or civil partner; or
  • a relative or family member (from a specified list) occupy the home and are:
    • aged 60 or over
    • under 18; or
    • incapacitated (which means that they need to be receiving incapacity benefits or have needs that would qualify for such benefits)

Local authorities do have the discretion to disregard the value of the family home if another person, not falling under the above continues to live there, for example, where it is the sole residence of someone who has given up their own home in order to care for the resident.

Deferred payments

Where there is a family home that is considered for means-tested benefits, but there is a reluctance to sell it (perhaps for sentimental reasons) then it may be possible to arrange for a deferred payment secured against the property. These are organised via the local authority and are in effect a charge against the property for the value of the care fees incurred.

The scheme can be used when an individual has been in a care home for 12 weeks or more (where the main asset for means-tested care is a property). A local authority should assist with the funding of the care and disregard the value of the property for the first 12 weeks.

Short-term stays will not be covered by the scheme, but it is possible to use the value of the home to ‘top-up’ care fees. This is where the local authority, having calculated the cost of the care that is to be provided, offers a care home that is not the preferred choice – where the latter is more expensive, the difference in the fee can still be paid.

Deliberate deprivation of capital or income

Often people consider that they can give away assets to avoid care fees – believing that the ‘seven-year rule’ that applies to inheritance tax on gifts also applies to gifts made with the express intention of avoiding care fees. This is not the case.

If a local authority is required to fund someone’s care and, once they have undertaken a financial assessment, find that that individual has given away a significant asset that could have been used to pay for their care – then they are able to take that asset into account as ‘notional capital’. This notional capital will then be considered in any financial assessment and will have an impact on how much money and financial assistance the local authority will then provide towards care.

There is no seven-year rule in these cases, although practically, the earlier the asset was gifted it may be harder to demonstrate deliberate deprivation, but no reliance should be placed on this.


Heledd is a Partner with national law firm and AAA member Shakespeare Martineau. Specialising in future planning, Heledd provides expert advice and guidance in respect of wills, powers of attorney, long-term care, and asset protection to both private individuals and business owners. You can contact Heledd by email or call 0117 906 9400.

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