A smiling carer chats with an elderly lady

Care Fees Funding: When is your home really your home?

Many people fear losing their family home to pay for care fees in later life, but in some circumstances the value of a property will be disregarded ie it will not be taken into account when assessing someone’s ability to contribute towards the cost of care.

When might my home be disregarded?

Under the current rules anyone with assets in excess of £23,250 will be required to pay for their care in full. Only when assets fall below £14,250 will those assets be disregarded in full. Individuals with assets between £14,250 and £23,250 are assessed as to how much they should contribute towards their care fees. The value of a resident’s permanent home is disregarded in making that assessment:

  • during the resident’s first 12 weeks in care;
  • if the house was acquired for occupation by a former partner of the resident; or
  • if the house is occupied by the resident’s partner, a relative who is aged over 60 or incapacitated or a child “as their home.”

Mrs Walford’s case

Earlier this year the High Court considered this issue for the first time and threw some light on how the relevant legislation in this area should be interpreted.

Mrs Walford was a widow with one child, Glen Walford. Ms Walford, who was over 60, is an acclaimed theatre director who works all over the world. Ms Walford had lived elsewhere for periods of time but because of her work commitments she had never owned any property, always renting and regarding the places in which she resided as temporary accommodation. Ms Walford had a bedroom, downstairs office, caravan and storage shed at her mother’s house and kept most of her belongings there. She had also paid the cost of maintaining the house and garden since her father’s death some years before.

Worcestershire County Council, which carried out the financial assessment, considered Ms Walford’s case and in November 2011 and decided to disregard the property. But the Council then reversed the decision on review the following March stating that, in their view, her mother’s house was more like a holiday home for Ms Walford and was not her home within the meaning of the legislation. Ms Walford appealed.

The High Court decision

The Court decided:

  • whether a property is a home depends on the degree and nature of occupation. As it is possible to have more than one home, for these purposes “home” should mean someone’s only home or main home if they have more than one home.
  • the Council was entitled to take into account where a person was registered to vote and where they paid Council Tax.
  • the Council had been wrong to use a test of actual occupation and/or permanent residence and to concentrate on the position as it stood when Mrs Walford entered residential care. Whether the property should be disregarded should be reconsidered whenever there was a change in circumstances.

The judge quashed the Council’s decision, ordering them to reconsider the case and decide the issue using the correct criteria. Worcestershire County Council are believed to be appealing and there is no indication at present as to whether Ms Walford has succeeded in having the property disregarded.

The practical effects of this case

As a result of this case we now know that:

  • for a property to be disregarded because it is a resident’s relative’s home, it does not have to be the relative’s only home, but it does need to be their main home.
  • in making that determination a Council is entitled to take into account where the relative is registered to vote and pays Council tax.
  • the Council should not determine the question by reference to the actual occupation or permanent residence of the relative.
  • if there is a change of circumstances the question of the property disregard should be reconsidered.
  • if other Councils have applied the disregard rule on the same basis as Worcestershire then it is possible that residents or relatives will now be able to appeal previous decisions.

For more information, please contact Anthony Fairweather.