Factsheet: Financial assessments for residential care
Summary
April 2025 (FS8)
This factsheet explains how we do a financial assessment if you are moving into a care home or nursing home.
The figures in this factsheet were given to us by the government and are correct at the date of publication.
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Introduction
'Residential care’ includes care arranged in a residential or nursing home. It can be respite, short term, temporary or permanent.
If you are going into a care home, we will complete a financial assessment with you. This will help us work out how much you can pay towards your care and support. The amount you pay is called your client contribution.
If you have been paying for your care privately in a care home, you need to continue to pay this until we complete your financial assessment.
If your residential care starts before your financial assessment is completed, you will need to pay a standard amount towards the cost of your care. After your financial assessment, the amount you are asked to contribute will be backdated to the start of your stay. You will be invoiced for any extra money needed or reimbursed if you’ve overpaid.
Read more in our leaflet: What you will need to pay towards the cost of your care and support
If you have more than £23,250 in capital, outside the home you live in, you need to pay the full cost of your care.
We try to arrange your financial assessment as soon as possible so that costs are not backdated for a long time. There are different ways that we do financial assessments, depending on your circumstances.
- We may use information from the Department for Work and Pensions (DWP) and HM Revenue & Customs (HMRC).
- We may ask you to use our online financial calculator to do your assessment online.
- We may contact you to discuss another way to do your financial assessment.
You will not have to pay for your care if you’re having ‘aftercare services’ provided under Section 117 of the Mental Health Act 1983.
We work out your contribution in line with our East Sussex County Council (ESCC) Charging for Care and Support Policy. The policy has been written in line with the Care and Support Statutory (CASS) Guidance issued under Care Act 2014 and The Care and Support (Charging and Assessment of Resources) Regulations 2014.
Information you will need to provide
Before your financial assessment, you need to have your supporting documents ready. Some examples are:
- pensions or benefits you get from the Department for Work and Pensions (DWP)
- statements or notification of any private pension or annuity income
- bank statements for all your accounts
- housing costs such as rent, mortgage and Council Tax
- Premium Bonds
- National Savings certificates or books
- share certificates
- information regarding any capital or property you previously owned
- investments and insurance plans
If you own your home, we do not take the value of your home into account while you are living in it. If you own land or a property you do not live in, we include the value of this as capital in the financial assessment.
If you do not provide all the information we have requested for the financial assessment, we may not be able to complete it. You may need to pay the full cost of your care until you can provide all the information we need.
If you do not want to tell us about your financial circumstances
If you would prefer not to tell us about your financial circumstances, you do not have to complete a financial assessment. You will have to pay the full cost of your care and support from the date your care started.
If you later decide you would like to tell us about your finances, you can contact the Finance and Benefits Assessment team:
Phone: 01323 464 699
We will arrange a new financial assessment. Your new contribution will start after the financial assessment is completed.
What is capital?
We use the term ‘capital’ to describe financial assets. These include:
- the value of your savings, current accounts, and investments
- cash
- buildings, property other than the one you live in, or land
- Premium Bonds
- stocks and shares
- any investments or trust funds that you have
- capital held in investment bonds
If you have more than £23,250 of capital and assets, you need to pay the full cost of your care.
You must tell us about all your capital assets including savings, investments, shares, insurance plans and property ownership. We look at the total amount you have.
If you have between £14,250 and £23,250, we apply a ‘tariff income’. This means that for each £250 (or part of £250) that you have above £14,250 we include an income of £1 a week. This isn’t to represent actual interest earned but a reasonable amount you can contribute from your capital.
Income
How much of your income we take into account
When we assess how much you should pay towards your care, we take most state benefits into account. We do not include:
- up to £7.05 per week of Savings Credit you receive as part of your Pension Credit
- up to £10.60 of Savings Credit if you are part of a couple
- £7.05 per week of your income or £10.60 if you are part of a couple if your income is above the limit for receiving Savings Pension Credit
We include most other types of income like private pensions, income from trusts and annuities.
How we work out your income
We look at your bank statements, benefit award letters and any other documentation to evidence your income. We also check the benefits and pensions you receive from the Department for Work and Pensions in case you may be entitled to higher rates.
If you have an occupational pension or retirement annuities, you can give half of this to a spouse or civil partner who you do not live with. This will not be included in the financial assessment.
Keeping money for your own use
You are entitled to a personal expenses allowance. This is not money we pay you, but income we disregard (exclude) in your financial assessment.
The government sets this amount each year and it is currently £30.65 per week.
Short term, respite or temporary care
If you are going to have short term or respite care in a care home, we will look at your ongoing costs at home and consider if these can be included in the financial assessment. We can consider rent, mortgage payments, Council Tax and standing charges like water.
Property
If you move into a care home permanently, we will take the value of your property into consideration in our financial assessment. We may not include it for the first 12 weeks. This is called a 12-week property disregard period.
After the 12-week period, the equity in your property will be considered a capital asset. This may result in your capital exceeding £23,250, meaning you have to pay the full cost of your care.
The financial assessment will determine if a 12-week disregard can be provided.
If you are going into a care home temporarily, we will not include the value of your home. We will look at some of your housing costs and see if we need to make any allowances for a partner living there.
A ‘mandatory property disregard’
We will not include the value of your home if it was continuously occupied by one of the following people, before permanent care started:
- your partner
- another family member or relative who is aged 60 or over or who is incapacitated
- a child under 18
This is called a 'mandatory property disregard'.
Following estrangement or divorce, if the property is still occupied by a former partner who is a lone parent, we will need evidence to show that it has been their long-term established home. We will discuss this during the financial assessment.
If we include the value of your home and this means you have to pay the full cost of your care, we'll talk you through your options and where to get more information and advice.
If a mandatory property disregard does not apply, but you would like us to consider disregarding your property, you can ask us to consider a ‘discretionary property disregard’. You can do this as part of the financial assessment appeals process.
We consider the adult moving into a care home's and property occupants' needs, circumstances, and characteristics. This decision needs to be balanced with ensuring a person’s assets are not maintained at the public’s expense.
Your choices if we take your property into account
Deferred payment agreement
If we include the value of your property in the financial assessment, one option is a 'deferred payment agreement'. This is a loan agreement between you and East Sussex County Council (ESCC). The rules around how we loan people money to pay for their care are set nationally.
We enter into a legal agreement and loan you the money to pay your care home fees. A legal charge is registered on your home with HM Land Registry.
We apply compound interest to the loan. You'll also need to pay administration and legal charges.
Discuss this and your other options with a friend, relative and independent financial and legal adviser before you make a final decision.
For more information, read our factsheet:
Going into residential or nursing care when you own a property
Other options
If you decide a DPA is not for you, then you can contact SOLLA. This not-for-profit organisation was set up to help people with later life financial matters.
Contact SOLLA
Phone: 0333 2020 454
Website: Society of Later Life Advisors
You can ask your care provider if they can hold the care fees until the sale of your property.
We can give you a list of providers who could help you with property maintenance and rental opportunities for your property.
Going into a care home which charges more than our usual rates
If you choose a care home that charges more than we would usually pay for care, a friend, relative or charity will usually have to pay the difference. This is called a ‘third party top-up’ charge.
Before we agree to this, the person has to complete an application form and evidence that they can afford to pay the ‘top-up’. Your worker can discuss this with you in more detail.
You may be able to pay the ‘top-up’ charge yourself during the 12-week property disregard period.
A ‘top-up’ arrangement should not be arranged privately with a care home if the Council is arranging your care.
Claiming benefits while you’re in a care home
You can continue to claim some benefits when you are in a care home, but others will stop. We will advise you about this when we do your financial assessment.
These benefits end after 28 days in a residential home:
- Attendance Allowance
- Disability Living Allowance (care component)
- Personal Independence Payment (daily living)
Contact the Department for Work and Pensions:
Phone: 0800 731 0122 for Daily Living Allowance and Attendance Allowance
Phone: 0800 121 4433 for Personal Independence Payment
After your financial assessment is completed
Appeals process
If you don’t agree with the outcome of your financial assessment, you can appeal. You will be given more information about this at the end of your financial assessment.
Yearly changes
We will review your financial assessment each year. This is based on yearly increases to benefits awarded by the Department for Work and Pensions, and the personal expenses allowance (PEA). After the review we will write to let you know about any changes in the amount you have to pay.
Changes to your financial situation
You must let us know if:
- your circumstances have changed since your last financial assessment
- you are unsure if we are aware of a previous change in your circumstances
You must also tell us if your circumstances change in the future. Contact us immediately if:
- you are given extra benefits or the amount you receive changes
- there are changes to any other income
- there is a change to your capital
- you own a property and the people living in it move out or their circumstances change
These changes may affect the amount you have to pay towards your care and support services. If you delay telling us about a change, any increased charges you need to pay are backdated.
Let us know if you are paying for your own care and you expect your capital to fall below £23,250 because of this. Try to tell us at least 6 months before your capital reaches this figure. We will work out when you will be eligible to receive financial help from us.
For more information about financial help when you have been paying for your own care, contact the Finance and Benefits Assessment team through our contact centre: Contact us
How to pay your contribution
If you are staying in a care home, you or your legal representative will pay your contribution direct to the care provider. The best way to do this is to set up a Direct Debit or standing order.
Contact them to discuss the best way to pay for your care, as each provider collects contributions differently. We suggest you pay at least every four weeks or monthly to keep up with payments.
It is your responsibility to pay your contribution towards your care. Failure to pay can result in legal action.
More information
See more leaflets and factsheets.
Contact us to get copies of this factsheet sent to you, or any of the other leaflets or factsheets mentioned.
Email: Health and Social Care Connect
Phone: 0345 60 80 191
Minicom : 18001 0345 60 80 191