Nicky Cave is a Care Fees Adviser and Managing Director of Eldercare Solutions Ltd, and is an Advisory Board member of the Society of Later Life Advisers.
Funding residential care is a topic we are frequently asked about at Hallmark Luxury Care Homes. There are many different aspects to consider, one of which is the value of property. Here, we offer advice on the 12-week property disregard.
What is a 12-week property disregard?
A care home 12-week disregard is a policy in the UK related to the financial assessment of a person moving into care. When a person is moving permanently into a care or nursing home, their primary residence is usually taken into account in the financial assessment of their care fees. However, there may be situations in which selling the home to fund this care isn’t suitable. This is where the 12-week property disregard comes in.
In this situation, your local authority must disregard the value of your property for the first 12 weeks of you moving into the care home. This is provided your other savings total less than £23,250 in England and £24,000 in Wales, and provided you meet their ‘eligibility criteria’ (i.e. they agree you need to move into a care home).
How much will your local authority pay?
Under the 12-week property disregard, your local authority will have a standard amount that they will be prepared to pay towards your care. If this is less than the fee charged by your chosen care or nursing home, the home may require a top-up payment. This can be made from any remaining savings you have, or alternatively a ‘third party’ could pay the top-up.
Remember, it is only the difference between your assessable income and the local authority’s standard contribution that will need to be paid. For example, if your local authority’s standard contribution is £500 per week, and you have assessable income of £300 per week, this leaves just £200 per week remaining to be paid.
If the fees at your chosen care home are £1,000 per week, the home will probably expect a £500 per week top-up to be made. Under the care home 12-week disregard, this money (the £200 per week contribution over 12 weeks) does not have to be repaid to the local authority.
What happens after the 12 weeks?
If the property has still not been sold after the 12-week property disregard, or you have decided not to sell it, the local authority should be able to lend you the money to pay for your care. This would be done through a ‘deferred payments agreement’ and would be recovered when your property is eventually sold. Before entering such an arrangement, you should take independent advice from a care fee planning specialist so that you can fully consider alternatives.
If the local authority knows you own your own home but do not tell you about available disregards, they could be liable to reimburse you. This would happen if they fail to allow a statutory disregard and, as a result, you pay more towards your care costs than you should have.
For more information on all aspects of financing a stay in a care home, please visit the Elder Care Website where you can download a free copy of our Guide ‘Paying for Care’, or find our number to call for a chat.