For many families, the prospect of care home fees raises difficult questions—not only about affordability, but about the long-term impact on inheritance. The UK care funding system is often perceived as opaque, yet it follows clear principles that, once understood, allow families to plan with greater confidence.
This article explains how care fees are assessed, when assets are used, and what this means for inheritance, without myths or alarmist assumptions.
How Care Home Fees Are Assessed in the UK
When a person requires long-term residential care, the local authority conducts a financial assessment, commonly referred to as a means test. This assessment determines whether the individual must self-fund their care or whether the council will contribute.
The means test considers two main elements: income and capital. Capital includes savings, investments, and in some situations, property. If total capital exceeds the upper threshold (currently £23,250 in England), the individual is typically responsible for paying their care fees.
Inheritance is not assessed directly, but the way assets are used during care has a direct effect on what remains later.
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Is the Family Home Always Used to Pay Care Fees?
A common fear is that entering care automatically results in the loss of the family home. In practice, the rules are more nuanced.
Whether a property is included depends largely on who continues to live there and whether the care placement is permanent.
| Living Situation | Is the Property Counted? | What This Means for Inheritance |
|---|---|---|
| Spouse or civil partner remains | No | The home is protected and inheritance is preserved. |
| Relative aged 60+ lives there | No | Property is disregarded under mandatory rules. |
| Dependent child lives there | No | The council cannot include the property. |
| No qualifying occupant | Yes (after 12 weeks) | Property value may be used to fund care. |
The Impact of the 12-Week Property Disregard
When someone moves into permanent care, the council must ignore the value of their home for the first 12 weeks. This mandatory disregard period is designed to give families time to assess options without immediate financial pressure.
During this time, care fees are not linked to the property, allowing informed decisions about future funding.
Deferred Payment Agreements and Inheritance
If the property is eventually included in the assessment, families are not forced into an immediate sale. Many councils offer deferred payment agreements, which allow care fees to be covered and recovered later from the estate.
This approach means the individual does not have to sell their home during their lifetime. After death, only the outstanding care costs are reclaimed, and any remaining value forms part of the inheritance.
Can Care Fees Remove All Inheritance?
Care fees can reduce inheritance, but they do not automatically eliminate it. The amount recovered is limited to the actual cost of care provided. Any remaining assets are distributed according to the person’s will or intestacy rules.
Importantly, children are not personally responsible for paying a parent’s care fees, and councils cannot claim more than what is legally owed.
Asset Transfers and Deprivation of Assets
Some families consider transferring property or savings to protect inheritance. This must be approached with caution.
If the council believes assets were deliberately reduced to avoid care fees, it may apply deprivation of assets rules. In such cases, the person may be assessed as though they still own the asset, negating the intended protection.
The key factor is intention, not timing, which is why professional guidance is essential before taking any action.
Planning Ahead Without Risk
The most effective way to protect inheritance is not avoidance, but informed planning. Understanding how care funding works, what is protected by law, and what options exist allows families to make decisions calmly and legally.
Early awareness reduces stress and helps ensure that both care needs and family interests are respected.
FAQ – Care Home Fees and Inheritance in the UK
Do care home fees automatically use up all assets?
No. Only assets assessed under the means test are used, and protections apply to certain property situations.
Can the council take money from children to pay care fees?
No. Care fees are the responsibility of the person receiving care, not their family.
Is inheritance guaranteed if someone owns a home?
Not guaranteed, but the home may be protected depending on who lives there and how care is funded.
How far back can councils investigate asset transfers?
There is no fixed time limit. Councils focus on whether assets were transferred to avoid care costs.
Can planning ahead reduce the impact on inheritance?
Yes. Understanding the rules early allows families to explore lawful options and avoid costly mistakes.
Get Expert Guidance on Care Funding
Navigating care fees and inheritance requires clarity, not guesswork. The right information at the right time can make a significant difference to both care outcomes and financial peace of mind.
For clear, personalised guidance on care funding and next steps, visit our website today and access expert support tailored to your situation.
Need help finding a care home?
Senior Home Plus offers free personalized guidance to help you find a care facility that suits your health needs, budget, and preferred location in the UK.
Call us at 0203 608 0055 to get expert assistance today.
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