Care Fees and Your Home: Limiting the Impact

Your home is often the largest asset you own, and whether its value is counted towards care fees depends on the type of care you need and who else lives there. It is not counted automatically, and several disregards can apply.

This guide explains, for England and Wales, when the value of a home is taken into account in a local authority financial assessment, the situations where it is left out, and the alternatives to an immediate sale. It also looks at how families approach care fees planning, and where mistakes can create problems. Figures are current as at June 2026 and are subject to change.

When is your home counted towards care fees?

The value of your home can be counted when you move permanently into residential care and a local authority carries out a financial assessment. It is generally not counted while you receive care in your own home, and it is left out in several situations, for example where a spouse or certain other relatives still live there. Whether a sale is needed depends on those disregards and on the alternatives available.

The distinction that matters most is between care at home and a permanent move into a care home. For care delivered in your own property, the home you live in is normally set aside in the assessment. It is chiefly permanent residential or nursing care that brings the value of a main home into scope, and even then only if no disregard applies.

How the financial assessment works

When a local authority arranges care, it assesses your capital and income to decide how much you pay. Capital includes savings, investments and, for permanent residential care, sometimes the value of your home. Two thresholds apply in England: an upper limit above which you meet the full cost, and a lower limit below which your capital is largely left out and the focus shifts to income.

Source: gov.uk, social care charging 2026 to 2027, as at June 2026, subject to change. Broader guidance on paying for care is at gov.uk/help-with-care-costs.

These limits apply in England. Wales sets its own capital limit for residential care, and Scotland and Northern Ireland run separate systems, so the exact numbers differ by nation.

Alternatives to selling your home

Selling is not the only way to meet fees where a home is counted. A deferred payment arrangement with the local authority can let fees be paid from the eventual sale of the property, secured against it, rather than an immediate sale during a person's lifetime. Renting the property to produce income is another route some families use. Which options are available depends on the local authority and on individual circumstances.

• Deferred payment arrangement. The local authority can agree to defer fees against the value of the home, repaid later, subject to eligibility and any interest or charges.
• Renting the property. Letting the home can generate income towards fees while retaining ownership, though it brings landlord responsibilities.
• Using other assets first. Some families draw on savings, pensions or investments before considering the home.
• Specialist care funding products. An FCA-authorised adviser can explain regulated options, such as a care fees annuity, that some people consider.

Because a deferred payment arrangement and any regulated funding product carry their own costs and conditions, one option some consider is to compare them with a qualified professional before deciding. General information on these routes is available at gov.uk/help-with-care-costs and from independent bodies such as MoneyHelper.

How care fees planning works

Care fees planning means organising your affairs so the impact of possible future care costs is understood and, where lawful and appropriate, limited. It is not about hiding assets. It commonly sits alongside a will, any suitable trusts, and a lasting power of attorney, and it considers who lives in the home, how it is owned, and what the assessment rules currently allow. The aim is a coherent plan, not a guaranteed result.

How a home is owned can matter. Couples who own as tenants in common can each leave their share by will, sometimes into a trust for the survivor to live in, which can affect how a share is treated later. Whether this is suitable depends heavily on circumstances and on current rules, so it is an area where many people take advice. Our own view is that the ownership question and the will are best considered together rather than in isolation, and this connects closely to your wider estate planning arrangements.

Care fees planning is about understanding the rules early and using the lawful disregards and options that fit your family, not about a last-minute transfer of the home.

A worked example (illustration only)

Consider a married couple, Ann and Brian, who own their home as tenants in common and have modest savings. Brian later needs permanent residential care. Because Ann still lives in the home, its value is generally disregarded in Brian's financial assessment while she remains there, so a sale is not forced during her lifetime. Brian's own capital is assessed against the £23,250 upper limit (gov.uk, 2026 to 2027, subject to change).

If Ann later dies and her will leaves her share of the home into a trust that lets any survivor continue living there, rather than passing her share outright to Brian, that share may be treated differently from a share Brian owns outright. Whether this helps, and whether it is appropriate, depends on the couple's full position and on the rules at the time. Every case is different, disregards and limits change, and this is general information rather than a calculation for any particular household. It can be worth discussing an arrangement like this with a qualified professional before acting.

For a fuller picture of what care itself costs and who pays, see our companion guide, Care Home Fees: Costs and Who Pays, which sits alongside this page in our estate planning guide.

Care fees and your home in Scotland and Northern Ireland

This guide describes England, with Wales noted where it differs. The other UK nations run separate systems. Scotland provides free personal and nursing care at set weekly rates and applies its own capital rules, so the way a home is treated is not identical. Northern Ireland operates its own means test through Health and Social Care Trusts. Wales sets its own residential care capital limit. If your situation crosses nations, it can be worth confirming the local rules and taking advice in the relevant one.

Frequently asked questions