Tenants in Common and Care Home Fees: What It Actually Does

Tenants in common and care home fees are linked by one specific idea: splitting ownership of your home so that, on the first death, one half can pass into a trust instead of straight to the survivor. Becoming tenants in common is the enabling step. By itself, while you are both alive and both own the house, it changes nothing about a care means test.

That gap between "we severed the tenancy" and "the impact of care fees is limited" is where most families are misled, so it is where this guide starts.

What does owning a home as tenants in common mean?

Tenants in common means two or more people own a property in distinct, named shares, often 50/50 but sometimes unequal, and each owner can leave their share to whoever they choose in their will. It differs from joint tenants, where you own the whole together and the survivor automatically inherits the lot.

The legal difference sounds small and matters enormously for care planning. Under a joint tenancy, the "right of survivorship" passes everything to the survivor the moment the first owner dies, so nothing can be redirected. As tenants in common, each share is a separate slice of the estate that a will can send elsewhere.

General position in England and Wales. As at August 2026, subject to change.

Do tenants in common limit care home fees?

Not on their own. While both owners are alive, the home is assessed as normal and severing the tenancy makes no difference. The effect only takes hold when the first owner dies and leaves their share to a life interest trust in their will. That trust, not the ownership label, is what can keep half the home outside a survivor's later care assessment and so limit the impact of care fees.

Here is the sequence that actually works. You sever the joint tenancy so you each own a share. You each write a will leaving your share to a life interest trust rather than to each other outright. When the first of you dies, that half goes into the trust. The survivor can live in the home for life, but they do not own the trust's half, so if they later need care, only their own half is theirs to be assessed on.

A life interest trust (also known as an interest in possession trust) gives the survivor the right to occupy and benefit from the home for their lifetime, while the underlying half is held for chosen beneficiaries, usually the children. Because the survivor does not own that half, a council assessing them for care typically cannot count it.

Miss the will trust and you have changed nothing for care. Two people who sever the tenancy but still leave everything to each other outright end up exactly where they started, because the whole home lands back in the survivor's sole name.

How does the council value a share of a jointly owned home?

A council in England assesses only the resident's own capital. Where a home cannot be disregarded, it counts their beneficial share, not the whole value, and a half-share of a house is usually worth less than half the market price because few buyers want part of a property with a sitting co-owner. Above £23,250 in capital a person self-funds; below £14,250 their capital is ignored.

Two disregards remove the home entirely in common situations. The property is ignored while a spouse, partner or a dependent or disabled relative still lives there, and for the first 12 weeks after someone enters permanent care if a sale would otherwise be needed (gov.uk, as at August 2026, subject to change).

The less-known point is valuation. A council must value what could realistically be sold, and a 50% share with another owner living in the home often carries a substantial discount, sometimes to a nominal figure, because there is no open market for it. This is separate from any trust and applies to ordinary tenants in common too.

England limits: upper £23,250, lower £14,250. Wales uses a single £50,000 limit for care-home charging. Source: gov.uk charging circular 2025 to 2026. As at August 2026, subject to change.

How do you change to tenants in common?

You convert a joint tenancy by serving a notice of severance, then recording it at HM Land Registry, then updating your wills so each share is left where you intend. Severing is straightforward and can be done by either owner without the other's consent; the wills are what give it purpose.

1. Serve a notice of severance. One owner signs a written notice of severance of joint tenancy and gives it to the other. It takes effect on delivery, and one owner can do it unilaterally.
2. Register the change at HM Land Registry. Apply to add a Form A restriction to the title, which records that the survivor cannot sell as sole owner and confirms the tenancy in common.
3. Update both wills. Each owner writes a will leaving their share where intended, to a life interest trust if care planning is the aim, not outright to each other. This step is what makes the severance count.
4. Consider a declaration of trust. Optional, but a declaration setting out the shares (for example 50/50) removes doubt later, especially if the split is unequal.

None of this needs the arrangement to be complicated, but the wills must match the ownership. A will trust with no severance, or a severance with mismatched wills, achieves nothing. Getting the two aligned is core estate planning, and a lasting power of attorney is worth putting in place at the same time.

Can changing to tenants in common count as deliberate deprivation of assets?

It can, if the main reason for the change was to avoid care fees and care was already a realistic prospect. A council can treat assets you have given away or restructured as if you still held them ("deliberate deprivation"), assess you on that notional capital, and in some cases recover from the person who received the asset. Timing and motive are what decide it.

There is no fixed time limit and no "7-year rule" for care fees, despite the phrase being borrowed from inheritance tax. A council can look back as far as it reasonably needs to and asks a single core question: was avoiding care charges a significant reason for the change, and could you have foreseen needing care at the time?

Severing the tenancy and updating wills years ahead, while both owners are in good health and as ordinary planning for children, is far more defensible than doing it once one owner is frail or a care assessment is near. Leaving it late is the single most common way this planning fails.

What do people get wrong about tenants in common and care fees?

The biggest errors are treating severance as the finished job, expecting it to help the first person to need care, and overlooking what the survivor gives up. The trust sets aside a share for the next generation, not the owner who created it, and it comes with real trade-offs.

1. "We're tenants in common, so we're covered." Not yet. Without matching wills leaving each share to a trust, the whole home still passes to the survivor and is fully assessable.
2. It does nothing for the first person into care. The trust is only created on death. If the owner who did the planning is the one who needs care first, their whole interest is still assessed.
3. The survivor cannot spend the trust half on their own care. That half is locked for the children. If the survivor needs a more expensive home, they fund it from their own share and savings only.
4. Selling or moving gets harder. Moving house means the trustees must agree and reinvest the trust's share; the survivor cannot simply cash in the whole property.
5. It is not an inheritance tax scheme. A life interest trust on first death usually passes between spouses tax-free anyway. Care planning and inheritance tax are separate questions with separate rules.

For the wider picture of how a property is handled once care starts, see our guide to care home fees and your home, and who is liable in our note on whether next of kin pay care home fees.

Frequently asked questions