Yes, in most cases people living with dementia pay towards their own care home fees. In England, dementia care counts as social care, which is means-tested, rather than as free NHS healthcare. Whether you pay depends on a local authority financial assessment of your capital and income, and care is only free where the NHS agrees you have a primary health need.
That distinction is where most guides stop and families get caught out. A diagnosis alone never makes care free, and the NHS nursing contribution most articles quote is out of date. What follows sets out the current 2026 figures, the means-test bands, how the family home is treated, and where lawful planning ends and deprivation begins.
Why does having dementia not make care free?
Dementia care is not automatically free because the law treats it as social care, not healthcare. NHS healthcare is free at the point of use, but social care in England and Wales is means-tested. Care is decided by the need it meets, not by the diagnosis, so most people with dementia are assessed on their savings and income like anyone else.
A medical diagnosis and a funding decision are two separate things. A memory clinic confirms the dementia; a local authority, or the NHS in limited cases, decides who pays.
| NHS healthcare (free) | Social care (means-tested) |
|---|---|
| Free at the point of use | Charged according to your capital and income |
| Covers a primary health need | Covers help with daily living, such as washing, dressing and supervision |
| Assessed through NHS Continuing Healthcare | Assessed through a local authority financial assessment |
Source: gov.uk, as at August 2026, subject to change.
How does the means test decide if you pay?
A local authority financial assessment sorts your capital into three bands. In England, capital above £23,250 means you pay in full. Between £14,250 and £23,250 you contribute a "tariff income" of £1 a week for every £250 in that band, plus what you can afford from income. Below £14,250 your capital is ignored and only your income is assessed.
Dementia care is costly: a residential dementia place averages around £1,375 a week and a nursing place around £1,585 (carehome.co.uk, 2026, subject to change), so the band you fall into matters.
| Capital (England) | Who pays |
|---|---|
| Above £23,250 | You fund your care in full ("self-funder") |
| £14,250 to £23,250 | You pay a tariff income of £1 a week per £250, plus income |
| Below £14,250 | Capital ignored; you contribute from income only |
Source: gov.uk, as at August 2026, subject to change. Wales, Scotland and Northern Ireland use different limits.
Worked example: capital of £20,000
Someone entering a care home with dementia has £20,000 in capital, so they sit inside the middle band:
- Capital above the £14,250 floor: £20,000 minus £14,250 = £5,750.
- Count each complete £250: £5,750 divided by £250 = 23 units.
- Apply the rate: 23 units times £1 = £23 a week of assumed "tariff income".
They contribute £23 a week from tariff income, plus their assessable income.
Once capital falls below £14,250, the tariff income stops and only income is counted.
When does the NHS pay the full cost?
The NHS pays the full cost only through NHS Continuing Healthcare (CHC), where an assessment finds your main needs are health needs rather than social ones. A dementia diagnosis does not qualify you automatically, and most people with dementia are found ineligible. Where you need nursing but do not qualify for CHC, NHS-funded Nursing Care pays a fixed weekly amount towards the nursing element only.
NHS-funded Nursing Care is set at £267.68 a week from 1 April 2026, up from £254.06 the previous year (NHS England, as at August 2026, subject to change). It is paid to the care home, not to you, and does not cover accommodation or personal care.
NHS Continuing Healthcare is assessed in a set order:
- Checklist screening. A nurse, doctor or social worker completes an initial checklist to see whether a full assessment is warranted.
- Full assessment. A multidisciplinary team scores needs across 12 areas, such as cognition, behaviour and continence, using a Decision Support Tool.
- Primary health need decision. CHC is awarded where the nature, intensity, complexity or unpredictability of needs shows a primary health need, not a fixed diagnosis.
- Outcome. If awarded, the NHS funds the full package. If refused, you can ask for a review, and the means test applies meanwhile.
Is the family home counted in the means test?
For permanent care, the value of your home is usually counted as capital, which is why many people with dementia become self-funders. It is disregarded, though, for the first 12 weeks of a permanent stay, and indefinitely while a spouse, partner, a relative over 60, or a dependent child still lives there. A deferred payment agreement can also let the council pay now and recover the cost from your estate later.
These property rules are where the numbers often turn, and where general care guides are thin. If a qualifying person stays in the home, its value may never enter the assessment at all.
| Situation | How the home is treated |
|---|---|
| First 12 weeks of permanent care | Value disregarded (the "12-week property disregard") |
| Spouse, partner or relative over 60 lives there | Value disregarded for as long as they remain |
| Home empty, no qualifying occupier | Counted as capital after any disregard ends |
| Deferred payment agreement in place | Council funds care; cost repaid from the estate later |
Source: gov.uk, as at August 2026, subject to change. See our guide to care home fees for the full picture.
What counts as deprivation of assets?
Deprivation of assets means deliberately reducing your capital, by giving money away or transferring your home, mainly to avoid care fees. Where a council decides you did this on purpose, it can assess you as though you still hold the asset, called notional capital, so the fees apply anyway. There is no fixed time limit, and the test turns on your intention when you acted.
This is the point families most often get wrong. Planning early, while someone has capacity and no care need is in prospect, is very different from transferring a home once dementia and a likely move into care are on the horizon. The first can be legitimate estate planning; the second invites a deprivation challenge.
Because dementia removes capacity over time, the practical steps are usually a lasting power of attorney made while capacity remains, then honest, well-recorded decisions after that. Registering an LPA with the Office of the Public Guardian costs £92 (gov.uk, as at August 2026, subject to change). We work in terms of limiting and mitigating the impact of care fees within the rules, never guaranteed "protection" of a home, set in the wider context of your estate planning.
Frequently asked questions
Is dementia care free on the NHS?
Usually not. Dementia care is treated as social care in England and Wales, which is means-tested, rather than as free NHS healthcare. It is only free where the NHS agrees, through an NHS Continuing Healthcare assessment, that your main needs are health needs. Most people with dementia are found ineligible and pay according to the means test (gov.uk, as at August 2026, subject to change).
Do you have to sell your home to pay for dementia care fees?
Not always. Your home is usually counted as capital for permanent care, but it is disregarded for the first 12 weeks and while a spouse, partner or relative over 60 still lives there. A deferred payment agreement can let the council fund care now and recover the cost from your estate later (gov.uk, as at August 2026, subject to change).
How much savings can you have before you pay care home fees?
In England, capital above £23,250 means you pay in full. Between £14,250 and £23,250 you contribute a tariff income of £1 a week for every £250, plus income. Below £14,250 your capital is ignored. These limits are unchanged for the 2025 to 2026 year, and Wales, Scotland and Northern Ireland differ (gov.uk, as at August 2026, subject to change).
Does everyone with dementia qualify for NHS Continuing Healthcare?
No. A dementia diagnosis does not qualify you automatically. NHS Continuing Healthcare is awarded only where a multidisciplinary assessment finds a primary health need, based on the nature, intensity, complexity or unpredictability of your needs. Many people with dementia are assessed as not eligible, in which case the local authority means test applies (gov.uk, as at August 2026, subject to change).
Can you protect your home from care home fees if you have dementia?
There is no guaranteed way to shield a home, and transferring it once care is in prospect can be treated as deliberate deprivation of assets. Early planning while capacity remains, a registered lasting power of attorney, and advice from a qualified professional can help limit the impact of fees within the rules. It is about mitigating the impact of care fees lawfully, not promising protection.