Current statistics show that one out of every four people at present will need some form of residential or nursing care before their death. Many people consider the risk of losing their home and savings to fund such care greater than the threat of inheritance tax. Health care in the United Kingdom is free at the point of use however social care can be charged for and, whilst domiciliary care in one’s own home is currently provided free of charge, Health & Social Care Trusts (‘HSC Trusts’) have a statutory duty to recover the costs of providing social care in a nursing or residential home. Where a resident indicates to the HSC Trust that they are unable to pay the cost of the care fees then they must complete a means assessment. The rules governing this means assessment procedure are set out in regulations and summarised in the Charging for Residential Accommodation Guide or ‘CRAG’ which is produced by the Department of Health, Social Services and Public Safety and updated periodically.

Content divide

What we do

At present, if a resident has capital of over £23,250.00, they will be liable to pay for the cost of their social care in full. When the resident has £14,250.00 or less, the capital is fully disregarded and the Trust is liable to cover the resident’s accommodation fees to the extent that these cannot be met from the resident’s income. Between these two thresholds, a tariff applies and the HSC Trust will meet a proportion of the fees. Most capital is likely to be taken into account for the purposes of the means assessment but certain exemptions do apply, for example if a spouse or other qualifying individual is living in the resident’s main home.

The HSC Trust can take account of assets that have been given away by a resident if they believe that they have deliberately deprived themselves of capital or income in order to increase the amount available from the HSC Trust to pay for accommodation. It may treat the resident as still possessing that capital or income and assess them accordingly. The HSC Trust will also look at the timing of any gift or disposal when considering its purpose and there is no time-limit on the HSC Trust’s right to “look back” at a disposal of assets in terms of assessing the donor’s motivation.

At Cleaver Fulton Rankin we have considerable experience in advising clients on how best to structure their affairs to minimise the risk of exposure to care fees. This includes a broad range of planning options such as the effective use of wills and trust vehicles. We can also advise individuals and/or their families in relation to means assessments and liaise with HSC Trusts on their behalf to ensure that the rules are correctly applied.

If you would like any further information about any of the issues mentioned above, or any other legal aspect of nursing or residential care, please contact a member of our Private Client team.