Will I Have to Pay Care Home Fees? What You Need to Know

Will I Have to Pay Care Home Fees? What You Need to Know

When planning for the future, one important consideration is the potential cost of care — especially if you or a loved one may need to move into a residential care home. Many people wonder: Will my estate have to cover the cost? The answer depends on your financial situation, and understanding the rules can help you plan more effectively. 

Do You Have to Pay for Care Home Fees? 

In the UK, care home fees are means-tested. This means your income and assets (including your home, savings, and investments) are assessed to determine whether you need to pay for your care and if so, how much. 

Financial Thresholds (2024/25 England) 

  • If you have more than £23,250 in assets, you are expected to pay for your care in full. 
  • If you have between £14,250 and £23,250, you'll need to contribute from your income and a portion of your capital. 
  • If your assets are below £14,250, the local authority will fund your care, although your income may still be used to contribute. 

Note: Thresholds may vary in Scotland, Wales, and Northern Ireland. 

Is Your Home Counted? 

Yes - in many cases, the value of your home will be included in the financial assessment. However, there are important exceptions. Your home will usually not be counted if: 

  • A spouse or civil partner still lives there;
  • A relative aged 60+ or under 18 lives there;
  • A disabled relative lives there.

This is known as the property disregard rule. 

What If You Own Your Home as Tenants in Common? 

If you own your home as Tenants in Common with someone else (often a spouse or civil partner), you each own a distinct share of the property — for example, you might own 60% and your spouse 40%.

In care fee assessments, only the share belonging to the person needing care would normally be considered — but crucially, if your spouse or civil partner continues to live in the property, your share is not counted. This is because of the mandatory property disregard rule, which applies regardless of how the property is owned.

However, if you live with someone who does not qualify for the disregard — such as an unmarried partner or a friend — your share of the property would be included in the means test, and you could be required to contribute to your care fees based on that value.

Owning a property as Tenants in Common can be useful in estate planning, especially when combined with a carefully drafted Will and Trust provisions. 

Can Care Fees Be Taken From Your Estate After You Die? 

Yes - if the local authority helped pay for your care, they may recover some or all of the costs from your estate after death. One common method is through a Deferred Payment Agreement (DPA). 

What Is a Deferred Payment Agreement? 

A Deferred Payment Agreement allows you to delay paying care home fees during your lifetime by using the value of your home to cover the costs later. Here's how it works: 

  • The council pays your care fees now;
  • A legal charge is placed on your property, like a mortgage;
  • When you pass away, the home is usually sold, and the council is repaid from the proceeds.

When Is a Deferred Payment Agreement an Option? 

A DPA is typically available if: 

  • You are moving into a care home permanently;
  • You own property (like your main home) but do not want to sell it immediately;
  • Your other savings and assets are below £23,250;
  • Your property is not currently disregarded (e.g., no spouse or qualifying relative living there).

Important: If your home is disregarded (because a spouse still lives there, for example), the council will not count its value and a DPA will not be needed at that time.

However, if the disregard ends in future, your property may then be reassessed, and a DPA could become available later. 

If You Paid Privately 

If you paid for your care yourself during your lifetime using income, savings, or property, your estate won't usually face any further care charges after your death. 

How to Plan Ahead 

  • Write a Will: Make your wishes clear and ensure your estate is properly managed;
  • Understand the rules: Knowing when your home might be counted is key to planning; 
  • Consider Tenants in Common: Splitting ownership can. help protect your share of the property;
  • Seek advice early: Gifting assets or using Trusts must be done carefully - otherwise, they may not be effective in avoiding care fees;
  • Talk to an expert: Financial and estate planning professionals can help you navigate the system and protect your assets.

Plan ahead, live confidently - contact us today.

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