If your needs assessment finds that you require residential care in a care home the council can arrange this. If you are eligible, the council may also contribute towards the cost of your residential care.
Sections in this guide (click title to view)
- 1. Calculating your contribution
- 2. Personal Expenses Allowance
- 3. Staying at expensive care homes
- 4. Deferred Payments
- 5. Example of how your contribution is calculated
1. Calculating your contribution
When conducting a financial assessment we'll take into consideration your income and capital assets.
Your income includes:
- benefits you receive - some benefits are not included when calculating your income.
- pensions you have
- any other money you may be receiving.
Certain benefits are not included in when calculating your income.
Your capital assets includes:
- money from investments
- the value of your property.
If you are going into residential care and your partner will continue to live in your home the value of your home is not taken into account when calculating your capital assets. The value of your property will also not be counted in your capital for the first 12 weeks of your stay.
Having capital below or over £23,250
If your capital is worth more than £23,250 then you'll need to pay for the full cost of your social care. If you expect your capital to fall below the £23,250 threshold after you begin paying for your care please let us know.
Even if you're not eligible for financial assistance, we can arrange your care and support services at your home for you. At present, we don't charge an administration fee to do this.
If your capital is less than £23,250 then the amount you're expected to pay towards your care will be means-tested under the Care Act 2014.
If the total value of your capital is £14,250 or under it will be disregarded when calculating your contribution and only your income will be taken into account.
If the amount of your capital assets is between £14,250 and £23,250 then you'll be asked to pay £1 a week for every £250 interval within this range.
The table below explains how this works in greater detail.
|Value of capital assets||Amount to pay||What this means|
|Capital assets of £15,250||£4 a week||There are 4 intervals of £250 above the £14,250 threshold: 4 x £250 = £1,000|
|Capital assets of £16,999||£10 a week||There are 10 intervals of £250 above the £14,250 threshold (as the value of assets is £1 below the next interval): 10 x £250 = £2,500|
The combined value of your weekly income and earnings from capital will be calculated to find your assessed charge (the amount you have been assessed as able to pay towards your social care).
You are entitled to a personal expenses allowance of £24.90 which will be deducted from your assessed charge and the remaining amount is your weekly contribution towards the cost of your care.
If your calculated weekly contribution is higher than our weekly rates for residential care homes then you won’t be eligible for financial assistance.
If your weekly contribution is lower than our weekly rates then we'll make up the difference.
You can see an example of how the assessed charge and your weekly contribution is calculated in the last section on this page.
2. Personal Expenses Allowance
If you are living in a care home then you are entitled to a Personal Expenses Allowance of £24.90 a week.
This is the amount set by the Department of Health and is reviewed annually.
The Personal Expenses Allowance is deducted from your assessed charge to find your owed weekly contribution towards the cost of your care.
For example, if your assessed charge was is £100 then your weekly contribution towards your care costs will be £75.10 following the deduction of the Personal Expenses Allowance.
The Personal Expenses Allowance is to cover the cost of items such as newspapers or toiletries and it should not be spent on care or support.
Savings Credit disregard
If you receive residential care in a care home and receive Savings Credit, then this will be disregarded up to an amount of £5.75 for an individual and £8.60 for couples. You are entitled to this amount in addition to the Personal Expenses Allowance.
3. Staying at expensive care homes
If you're eligible for financial assistance from us but wish to stay in a care home that charges more than our rates, you may wish to discuss top-up fees with the Adult Social Care Brokerage Service.
If you have a friend or relative that wishes to pay an additional contribution to cover the cost of a more expensive care home, they may be able to make third party top-ups to cover this difference.
However, there is no obligation for them to do so and if the third party top-up fees stop you will have to move to a care home that is within our rate.
Any alternative care homes that you wish to stay in must meet the needs identified in your needs assessment.
We may ask for evidence that the third party can sufficiently cover the cost of the top-up fees for the planned duration of your care.
Download and read our guidance document about third party top-ups.
4. Deferred Payments
Most people who own a home will have an asset that is worth more than £23,250 and will therefore need to pay for the full cost of their care.
However, this means that some people cannot access their capital immediately as it is tied to the value of their home.
If the value of your capital assets (not including the value of your property) is below £23,250 then you may be able to use the value of your home to pay for the cost of your care at a later date by entering a Deferred Payment Agreement with us.
Rather than having to sell your home immediately, you can sell your home at a later date or after death and we'll cover the cost of your care until your home is sold. We'll then recover the valued owed to them from the profit of the sale.
We charge a small amount of interest to cover the administrative costs of setting up a Deferred Payment Agreement. This interest does not generate any profit for the council and the rate of interest has been set by the government.
Currently, the interest charged on care costs paid through a Deferred Payment Agreement is 1.65 per cent.
We'll send you regular statements detailing the outstanding charge of your account. You may wish to seek independent financial advice if you are considering a Deferred Payment Agreement.
Disposable Income Allowance
If you enter a Deferred Payment Agreement with us, you're entitled to a Disposable Income Allowance of up to £144 per week.
This is taken from your earnings from income and capital and it is your choice as to how you spend this. Some people decide to use some of their Disposable Income Allowance to pay towards the cost of their care so that their overall debt to us is lower. However, it is not necessary for you to do this and we'll never force you to do so.
Other ways of paying for your care
If you are not eligible for financial assistance and a Deferred Payment Agreement is not right for you, there are other ways to pay for the cost of your care and support.
It is recommended that you seek independent financial advice when considering using the value of your home to pay for your care. More information on alternative ways of funding your care is available from:
If your stay in a care home is temporary
If you are only receiving residential care in a care home on a temporary basis then the value of property will not be included in the value of your capital when your contribution is calculated.
5. Example of how your contribution is calculated
Your contribution towards the cost of your care will depend on your circumstances.
Here is an example:
Jane Bloggs is 71 and has developed dementia. She will need to move into a residential care home to receive the support that she needs.
|Savings in bank account||£15,250|
|Any other assets||£0|
|Tariff income (calculated from the value of capital)||£4|
|Income from pensions||£130|
|Income from benefits (excluding Attendance Allowance)||£40|
|Disability Living Allowance (DLA) or Personal Independence Payments (PIP)||£0|
|Any other income||£0|
|Total weekly income||£174|
Jane Bloggs’ assessed charge is £174 per week. As she will be receiving residential care in a care home she is entitled to a personal allowance of £24.90 per week.
Deduct the personal allowance from the assessed charge (£174 minus £24.90) leaves £149.90.
Jane would therefore pay £149.90 per week towards the cost of her residential care.