How much will the Local Authority Contribute?

If you have assets below the 'upper capital' limit, this depends entirely on which Local Authority the person resides in (and may not necessarily be where the care home is based). Each Local Authority sets their own amount and is dependent on the type of care required. The amount they pay may not necessarily cover the full fees at the home which may result in family or another 'third party' having to 'top-up' in order to make up the difference.

How much will the person going into the care home be able to retain?

Any state and half of any occupational pensions, plus any other income or benefits such as Attendance Allowance or Disability Living Allowance to which they are entitled, will have to be paid to the Local Authority. The only income that can be kept is a personal expenses allowance of £21.90 a week in England, Northern Ireland and Scotland, and £22 in Wales.

If the assets are below the 'lower capital' limit (£14,000 in England and Northern Ireland, £20,750 in Wales and £13,750 in Scotland) there is nothing further to pay. For every £250 of capital above this limit, £1 per week is deducted from the Local Authority's contribution towards the cost of care.

Calculating the shortfall in care funding

At the initial meeting our adviser will establish that all entitlements have been claimed and will then calculate the shortfall. The shortfall identifies the extra money needed each month to pay for care fees in addition to pension income and state benefits.

To give you an approximate idea of whether you may have a potential funding shortfall please use the Care Fees Shortfall Calculator provided on our website.

Treatment of property

If a person has assets, including the value of their home and other property, greater than £23,000 in England and Northern Ireland, £22,000 in Wales and £22,500 in Scotland, then the care fees will have to be paid privately. However, if the main asset is the property and any other savings are less than those amounts there may be some financial assistance available from the Local Authority.

Providing the person entering care has been assessed as needing permanent care, and has savings below the 'upper capital' limit, the Local Authority must disregard the value of the home for the first twelve weeks and assist with the payment as if the property did not exist. However, they will only pay up to their standard rate and all forms of income (except the personal expenses allowance) will have to be paid to them. This is known as the ‘12-week property disregard’.

At the end of the 12-week disregard period, it may be possible for the Local Authority to continue to pay towards the care home fees, up to their standard rate, for the remainder of the person’s life. This is by way of a loan against the property and must be repaid on death. This is at the discretion of the Local Authority and may not be available to everyone. This is known as a ‘deferred payment' agreement.

It is worth noting that, under certain circumstances, the value of the home can be disregarded by the Local Authority when calculating the amount of any capital the person entering care has.

Further information

To find out more about state funding and other benefits you may be entitled to, please visit the websites featured on our Useful Links page.