Unlike NHS healthcare, which is funded from general taxation and National Insurance, social care is not always free at the point of use. The main ways you pay for care either at home or in a care home are by:

• Self-funding: you pay all or most of the costs yourself
• Local authority funding: the local authority will pay some or all of your care costs, which is means tested
• NHS funding: your care is paid for by the NHS when you are in hospital or a hospice or if you need substantial medical support at the end of life; read more in our article NHS funding for care.

Am I eligible for local authority funding?

To establish if you are eligible for local authority funding you will need to take two assessments organised by your local authority.

Needs assessment

This works out the level of care you require either at home or in a care home. It looks at the challenges you may be facing and what help you need to maintain your quality of life.

To apply for a needs assessment get in touch with your GP, community nurse or your local authority’s adult social care team. The assessment will then be carried out by an occupational therapist or social worker.

If your needs are deemed to be ‘eligible’, you should be given a written care plan and you will then have a financial assessment. If your needs aren’t considered to be eligible, you will need to arrange and pay for your own care and support.

Financial assessment

This assesses your ability to pay for care, which is determined by the level of your financial assets. If you’re moving into a care home, the value of your home may also be taken into account. It will only happen if you’ve been assessed as having eligible needs following a needs assessment.

The local authority will look at your capital (savings and assets) and income to work out if you’re eligible for financial support. To qualify for local authority funding, your assets must be below £23,250 in England, but you will contribute to the cost of care on a sliding scale until your assets are below £14,250. (Thresholds differ in each nation in the UK. See the bottom of this article for links to further information.)

You will be given written information about how much your care will cost, as described in the needs assessment, and what, if anything, you will need to pay.

I own my home. Will it be included in the means test?

For care in your own home: the value of your main home will not be included.

For care in a care home: the value of your home will be counted unless the following are still living there:

• a spouse or partner
• a close relative who is over the age of 60 or qualifies for a disability benefit
• a child you’re responsible for.

The value of your house should also be disregarded if you temporarily move into residential care.

The 12-week property disregard

If you’re moving into permanent residential care and your savings are below the care funding threshold of £23,250 in England, the council will disregard the value of your home for the first 12 weeks after you move into a care home.

What happens if I’m eligible for local authority funding?

Your local authority should pay a realistic amount that will provide you with the care you need, but they will want to do it cost-effectively. This means that you won’t necessarily be able to move to a care home of your own choice or use your preferred care agency. The choice available to you will be determined by the local authority.

You should also be aware that the amount of funding you are awarded will be fixed by your local authority. Should you want to move to another area with a different local authority and where care homes are more expensive, a relative may have to pay a top-up fee to cover the cost of the care home.

A top-up fee could also be paid to a care home of your choice in the area where you were initially assessed. You can read more about top-up fees  on the Independent Age website.

Can I challenge the needs or financial assessments?

If you are unhappy with the council’s decision, you can challenge it by first complaining to the relevant local authority. Check that there is a dedicated appeals process for social care decisions. If there isn’t one, go through the council’s standard complaints procedure.

If you remain dissatisfied with the council’s response and live in England, your final option is to take the matter to the Local Government and Social Care Ombudsman .

Who will manage the payments?

If you are receiving permanent care in a care home, the local authority will usually pay the fees directly to the care home.

If you are receiving care in your own home, you should be offered some control over your budget either through direct payments into your bank account or in an account managed by the local authority. Alternatively, you can allow the local authority to arrange and pay for all your care services.

Find out more

• For more information, see Paying for care  on the Independent Age website.
• This article only covers the social care funding thresholds and rules in England. For information about the other nations in the UK, go to Care Information Scotland , NIDirect in Northern Ireland  and the Welsh Government social care website .

Related pages

• How to pay for end-of-life care: living with a terminal illness or caring for someone who is terminally ill can be expensive; find out what financial help is available.
• Your rights and benefits at work: find out what you might be eligible to receive following a diagnosis of an incurable illness, including Statutory Sick Pay and New Style Employment and Support Allowance.
• Disabled Facilities Grant (DFG): establish if you can apply for this means-tested capital grant for people of any age with a permanent disability.

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