What is the 7 year rule for care home fees?


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There is a common misconception regarding care home fees known as the "7-year rule." Many individuals believe that if they transfer assets, such as money or property, at least seven years before entering a care home, these assets won't be considered in the financial assessment. However, this belief is not accurate, and the 7-year rule is a myth.

Dispelling the Myth of the "7-Year Rule" for Care Home Fees

Clarifying the truth about asset deprivation

  • Evidence and motive: Local authorities scrutinize asset transfers to determine if they were intended to evade care home fees. They assess the impact on an individual's capital, often against the £23,250 capital limit in England.

  • Intention matters: The individual's intention at the time of asset transfer is pivotal. If it's reasonable to foresee the need for care in the future, asset transfers could be considered deprivation. For example, transferring property before a needs assessment for residential care.

  • National capital: Even if asset deprivation is proven, the transferred property's value is still factored into the financial assessment as notional capital, impacting eligibility for care home financial support.

Dispelling misconceptions about the "7-Year Rule"

The notion of a fixed time limit for asset transfers to be disregarded in financial assessments is a myth.

Instead, local authorities analyze motive, intention, and impact on capital when assessing potential asset deprivation. Seek professional advice to ensure your financial decisions align with long-term care needs and regulations.

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