Caring for an elderly relative or planning for your own future needs is stressful enough, but what are the costs involved and is any help available?
Legal advice from Kent expert Gail Hall
According to recent government figures more than 20,000 pensioners had to sell their homes to pay for their care last year. More families could well find themselves facing rising care fees since most local councils are saying that they are considering reducing their spending on care for the elderly, blaming budget cuts and the ageing population. The Centre of Social Justice says that an additional 1.7 million pensioners are expected to be dependant on others within two decades. Care costs have risen steeply while people’s means of paying by using their property or other savings have declined.
The Government is under pressure to deal with this national problem but reform does not look imminent. In the meantime, people who are faced with arranging care for relations are often left to negotiate a minefield of information.
They can find themselves having to make life-changing decisions regarding care at very short notice following a crisis such as a fall or stay in hospital and often feel pressurised into acting with little information.
What do you have to pay?
As a guide, if you are a home owner you are likely to fail the local authority means test and be considered a ‘self funder.’ In England this threshold is currently �23,250. If a spouse, civil partner or relation aged 60 or over or a relation who is incapacitated is still living in the property it will not be included in the local authority assessment. It should also be disregarded if your care needs are seen to be ‘temporary.’ If your other assets excluding your home are less than �23,250 you should not be charged for the first 12 weeks, but you will be expected to make a partial contribution after that of �1 for every �250.
Local authorities also have the power to place a legal charge on a home rather than selling it upfront.
Is any financial help available?
If you are in a care home you can keep receiving Attendance Allowance and the ‘care component’ of Disability Living Allowance but either benefit will be removed after four weeks if you are relying on public funding.
If you are self-funding then your benefits will remain. If you need nursing care rather than ‘personal care,’ you should receive a contribution towards this cost regardless of your financial position. Payments can be up to �108 per week in England with money being paid direct to the care home.
Other things to consider
If you give away money or capital assets to avoid paying fees this is seen as ‘Deprivation of Assets’ and will mean that any assessment of what you would have to pay may still include the value of those assets.
The inclusion of a trust in a will can safeguard assets from local authority scrutiny should the survivor of a couple need to go into a care home and does not have adverse tax implications.
You could also think about making a Lasting Power of Attorney, appointing a family member or adviser to take care of things for you if at some point in the future things get too much. There are two types of LPA, one covering property and finances and one health and welfare.
If you are able, try to discuss what you would want to happen to you if you were to need care before it is too late. Your family, friends or advisers could have to make decisions for you not knowing what you would really want which could be distressing for everyone.
PROFILE
Gail Hall works in Whitehead Monckton's Tax and Estate Planning department, having qualified as a solicitor in September 2009. She is also currently studying for a postgraduate Diploma in Art and Law. Before retraining as a solicitor, Gail worked in London auction houses for 15 years and has a degree in History of Art from the Courtauld Institute, University of London. A Kent resident for 20 years, she lives with her husband on a fruit farm in the Weald.
