Yesterday the Conservative party released their manifesto. Among their proposed policies were new changes to social care that Estate Planning Practitioners should be aware of.

The first proposed change is to the threshold at which a person will become responsible for self-funding. Currently is a person has assets over £23,250 they must fully self-fund their care. This threshold may be increased to £100,000. This means that a person’s estate will never be reduced below £100,000 by social care.

On the other hand, the family home’s position in the means test will change. Currently when a person needs care their home will only be taken into account and treated as capital for the means test if they require residential care.  Even then it will be disregarded if it is still being used as a main residence by that persons spouse or civil partner, lone parent who is their estranged spouse or civil partner, or certain relatives who are ages 60 or over, incapacitated or your own minor child. If the home is disregarded then only savings and income will be taken into account for the means test.

If a person is receiving domiciliary care and is not entering permanent residential care then their home is not currently taken into account, only income and savings. Under the proposed new rules a person’s home will now be taken into account even when they are not moving into residential care.

No one will be forced to sell their home in lifetime. It will be possible to defer care payments until after death so they will be recovered from the estate, which is already the case for people who require residential care.

These changes will mean that more elderly people’s homes will be brought into the means test and more people will be responsible for funding their own care. Logically this will also affect the rules surrounding deliberate deprivation. More careful advice should be given where a client wishes to settle their property in lifetime as reasonable foreseeability of any kind of care, not just residential care, may now be taken into account where a Local Authority believes a person to have deliberately deprived themselves of assets.

  1. It must be emphasised the changes only refer to social care. Thousands every year are wrongly assessed as requiring social care when legally they qualify for NHS [free] continuing health care. And frequently self-funders wrongly pay for care until they die often penniless. Knowing the rules can help prevent such issues arising.

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