What is the financial assessment?
If you have been deemed eligible for care following a needs assessment, a financial assessment (also known as a ‘means test’) is then organised by the local authority. They look at your capital (savings and assets) and income to determine how much you should contribute towards the cost of your care.
The means test threshold for the financial assessment
For the financial year 2020-21, if your total capital is:
- less than £14,250: you’ll be entitled to maximum support from the local authority. You won’t have to contribute from your capital, but you may be expected to contribute from your income.
- more than £14,250, but less than £23,250: you have to contribute towards the cost of your care – £1 for every £250 of savings between £14,250 and £23,250. This is known as ‘tariff income’.
- more than £23,250: you’ll have to pay the full cost of your care. If you have less than £23,250 in capital, but a weekly income that is considered to be high enough to cover the cost of your care, you’ll have to pay all of your fees.
For care at home, the value of your home is not included in the financial assessment. However, if you are being assessed for residential care in a care home or nursing home, the value of your home will count as part of your total capital.
If you’re a pensioner, any income contributions you make shouldn’t take your income below the level of the weekly Minimum Income Guarantee (MIG), which is £189 (2020-21). If you’re a member of a couple, your individual MIG is £144.30, or £288.60 if you both need care.
Some local authorities add 25% to the MIG and also might pay higher than the basic level, so it’s worth asking your local authority what their policy is to enable you to plan your cash flow.
In Northern Ireland
In Northern Ireland, home care is free if you have been assessed by your local Health and Social Care (HSC) Trust as needing it. This is regardless of personal circumstances, so no financial assessment is necessary.
In Scotland, personal care is free if you’re over 65 years of age and have been assessed by your local authority as needing it. This is regardless of personal circumstances – so no financial assessment is necessary. However, charges still apply to non-personal care services.
If your total capital is:
- less than £24,000: you’ll be entitled to maximum support from the local authority. You won’t have to contribute from your capital, but you will be expected to contribute from your income.
- more than £24,000: the most you’ll have to pay in 2020-21 is £100 per week for your care at home.
For care at home, the value of your home is not taken into consideration in the means test.
More detailed information
For a full understanding of the obligations set down for the local authorities in England and Wales, see the government’s Care and Support Statutory Guidance, especially Annexes B and C. Scotland has its own version of this guide.
Rules for couples
A person being assessed for care at home should be treated as an individual. So if you’re married or living with a partner, only the income of the cared-for person can be taken into account in the financial assessment.
If you share a savings account with another person (partner, family member or friend), consider splitting it into separate accounts so it’s easier to see who has what for the purposes of the financial assessment and paying for care in general. Be warned, however, that there are strict rules about ‘giving away’ assets – see gifting assets and property.
Calculating capital and income for care at home
The financial assessment for care at home will look at your capital (savings and assets you own that have monetary value) and income (the regular money you have coming in).
What happens next?
After the financial assessment has been completed, you should be provided with written information from the local authority detailing how the charges are worked out, and what you’ll need to pay.
- qualify for help with costs, you’ll then be offered a personal budget for social care
- don’t qualify for help, you’ll be looking to self-fund your care at home in which case see our guidance on paying for home care
- are unhappy with the assessment, you can challenge a local authority’s decision.
Getting help if don’t qualify for financial support
If you (or someone you are caring for) have been assessed as having eligible care needs, but you do not qualify for financial support towards the cost of your care, the local authority may still be able to help with arranging your care.
In this situation, the help they can offer will depend on your needs and circumstances. For example, the local authority may give you advice on your options, recommend suitable care providers, or help to arrange a contract with a care provider. However, you may be liable to pay an arrangement fee for any help they give in arranging homecare, as well as the care costs that will be incurred. But you will not be charged for the assessment of your needs, the assessment of your finances, or the preparation of your care plan.
Contact your local authority for more information about what help they can provide for your situation.
We explain the options for paying for care at home, from local authority support to paying for it yourself.
Home care fees can vary according to where you live in the UK and the type of care you need.
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