When getting to the stage of needing to receive care most of us would prefer such care to be provided in our own homes. However, sometimes the care required either cannot either be provided at home because the care needs are too severe and sometimes home care is prohibitively expensive. In those circumstances it may be necessary to move into a residential care facility.
Residential homes charge fees on a weekly basis. The fees vary according to the level of care required and the facilities available at the home, but an average charge is £1,500 per week.
If the value of your assets exceeds certain thresholds (£23,500 for ‘subsidised’ financial assistance and £14,250 for full assistance) then you will be self-funding meaning you pay for your own care in full (subject to any nursing allowance which may be available). If you are self-funding the value of some assets are excluded. For example, personal belongings and life interests in land.
The Local Authority will take into consideration bank accounts held jointly with another, all solely held accounts including the value of a home owned outright (subject to certain concessions, i.e. it being needed as a home for a spouse or other person over the age of 60 or a disabled person). They will also look at any income receipts. 50% of an occupational or personal pension is disregarded if it is required to support the spouse or civil partner.
If, following you taking up residence in a nursing home, the sale of any property proves difficult, a deferred payment scheme secured against the property may be arranged for any fees incurred after a 12-week property disregard which should be available to all homeowners.
Due to the devastating effect that nursing home fees can have on one’s assets, many people consider gifting prior to going into a nursing home in the belief that this will protect those assets. If you subsequently go into a nursing home and cannot pay your fees, the authorities may well investigate any gifts that you have made and approach the person who received them to recoup the value. Please note that this includes any gifting into lifetime trusts.
Gifting and then being unable to pay fees is known as deprivation of assets and is not allowed. In addition, many people are under the misconception that if a gift is made prior to seven years from taking up residence in a nursing home, it cannot be counted. Unfortunately, this is false – the seven-year rules apply to inheritance tax only and has no bearing on nursing home fee assessment.
There are, of course, always promises by the Government to review the payment of nursing home fees with previous administrations having promised to cap the fees. Boris Johnson said that no one would have to pay more than £82,500 in nursing home fees. Unfortunately, he was talking about the nursing element only and not the cost of the ‘hotel’ element of fees. You would have to be in a nursing home for many, many years before you got anywhere near paying that sum in nursing fees by which time you would have paid tens of thousands of pounds for the ‘hotel’ element.
It is not thought that any Government legislation will be passed in the near future to address this depressing and unfair situation due to the state of public finances.
The content of this article is intended for general information purposes only and shall not be deemed to be or constitute legal advice. We cannot accept responsibility for any loss because of acts or omissions taken in respect of this article. If you require assistance with protecting assets from care home fee assessment, please contact Roz Wyeth by email admin@wyethpaullaw.co.uk or by telephone 02392 001551.
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