Paying For Care

Cuan O’Shea- Managing Partner at Bevan and Buckland explains how ‘the meltdown at Southern Cross, the nursing home provider, has highlighted both the cost of paying for care for the elderly and also the risks involved in running these businesses.  There is also a personal cost to care provision which is often overlooked until it is too late to effectively do anything about it.’

‘If you are self funding as a resident in a care home, you will be paying a minimum of £420 per week.  It also should be realised that the majority of people who have assets of more than £22,500 at the point of going into a care home will be self funding.  This means that it is possible to lose 100% of all of your assets in excess of £22,500 if you have a prolonged stay in a care home.  This should be compared with inheritance tax where there is a tax of 40% (which is still seen as very high) on assets in excess of £325,000.’

Cuan explains that ‘in order to try and avoid this penal rate of “tax” on care home costs, there are steps that can be taken, but need to be done well before the thought of nursing home care becomes a reality.’

Cuan O'Shea Managing Partner at Bevan and Buckland

Cuan O'Shea

He believes that ‘the following can be done, reasonably straight forwardly.’  However, it is advisable that professional advice is taken either from an accountant or a solicitor in order to minimise the costs to the family.

  1. Review your Will, so that bequests to children and grandchildren can be made or trusts created rather than leaving everything to the surviving spouse.
  2. Sever any joint tenancies in properties or bank accounts.
  3. Gift as many assets away as can be done tax effectively, and also from an economic point of view, to reduce the size of the estate which will have both an inheritance tax benefit as well as a cost of care home benefit.

He states that ‘these are just a few of the actions that can be implemented in order to reduce the real cost of care home provision to those people who will be self funding.’

‘The current care system may not be fit for purpose and the recent Dilnott Report has outlined changes.  However, given the ageing population and the large sums of money involved in times of austerity, changes to this system could be long and drawn out.’

If you would like any further advice on these issues raised or would like to book a free meeting then please contact Cuan on 01792 410100 or email

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