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Protecting your estate from care home fees

View profile for Karen Fryer
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Without the correct estate planning, the value of your home could be lost to care home fees in the future.  Naturally, people want to protect their assets so that they can pass on the value of these assets to their loved ones on their passing.  There may be some steps you can take to protect your estate from care home fees using your Will.  This is a complex area and advice should be taken from our specialist Will writing advisors.

The starting point for care home fees

If it becomes necessary for you to enter residential care, the Local Authority will carry out a needs assessment.  Following this, if the Local Authority assess that the best way to meet your needs is in residential care, a financial assessment will be undertaken to ascertain whether you qualify for funding towards the cost of your care.  Both your income and capital will be taken into account.  Capital includes your savings, investments and your property.  At the time of writing, you do not qualify for Local Authority funding if you have more than £23,250 in capital (or an income high enough to meet the cost of your care).  You will therefore need to pay for your own care.  In certain circumstances, your interest in your property can be ‘disregarded’; for example if it is your former home and your partner still lives there. 

Using a Life interest trust to protect your property from care home fees

Owning your property in a specific way, as ‘Tenants in Common’, means you each own a specific share of the property (often half each), and your share will pass under the terms of your Will.  A Life interest trust in your Will can allow your spouse or civil partner to live in the property for their lifetime after your passing, and your share in the property is held ‘in trust’ for your beneficiaries (for example, your children).  As your spouse or partner owns only his or her half share, the assets held in the trust should not form part of their estate for care fees funding.

Get advice on trust Wills

For a trust Will to be effective, you would need to take specialist advice for your particular circumstances. Paying for your care is complex and every case is unique, so contact a member of our Private Client team at one of our offices – York, Selby, Malton or Pickering.