Giving away assets to avoid paying for care

Giving away assets to avoid paying for care is when you deliberately reduce your overall assets to avoid paying for care provided by your local authority, including care home fees.

The assets that you give away could include the value of your savings, property and income. The local authority would usually include these in your financial assessment to determine how much you should contribute to the cost of your care home fees. It has been known that if your local authority believe you have intentionally given away your assets to avoid paying for longterm care, they may include the value of these assets in the means test to determine what your contribution should be.

Receiving funding for care

The amount of help or funding you receive from the local council truly depends on the value of your assets. A needs assessment is carried out by the local council to see what level of care you require, they will then conduct a financial assessment (means test) to look at your assets. The threshold for state-funded care in England is £23,250, meaning if your assets are valued over this then you will have to pay all care fees yourself.

Giving away assets

Also known as deprivation of assets, giving away assets to avoid paying for care is often considered by many people. The main factors that need to be taken into account are timing and amount. Most people in their lifetime will gift money or assets to family members but the amount and timing of this needs to be considered as this may be considered as the deliberate giving away of assets to avoid paying for care.

Some examples of what is considered as deprivation of assets:

  • Gifting a lump sum of money to a family member
  • Transferring property into someone else’s name
  • Selling a property to someone for less than it is worth
  • Buying or gifting expensive items
  • Suddenly spending large amounts of money
  • Gambling
  • Putting money into a trust

The council will consider the timing and the intention of the any of the actions above. There is no time limit to the giving away of assets, meaning any past deprivation of assets could be considered. The local authority will however take into account the motive and consider if the amount made a substantial difference to the capital limit (e.g., £23,250 in England).

If a local authority decides that assets were given away to avoid paying for care, you can challenge the decision. Reasons need to be given to show that you giving away assets had nothing to do with avoiding care costs.

For more information or advice on financial assessments for care and deprivation of assets, please get in touch.

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