Who pays for it?
In England, home care is paid for in two main ways: through the local authority for people whose savings sit below a threshold, and privately for everyone else. The page below sets out how the means test works, the benefits worth knowing about, and the main ways people meet the cost from their own resources.
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Two routes, depending on the means test.
If your savings sit below a capital threshold, the local authority will help fund your care, sometimes in full. If they sit above it, you fund the care yourself — usually from a combination of pension income, savings, and where applicable the value of a home. There's also a small non-means-tested benefit worth knowing about, which goes toward care costs in either case.
The page below covers each piece in turn. It's general orientation, not financial advice — for any decision involving the value of a home, an annuity, or a long-term commitment, you'll want to speak to a regulated adviser. We can suggest where to start.
The council pays only if your capital sits below
In England, local authorities will help fund someone's care only if their capital — savings, investments, and certain assets — falls below £23,250. Below that, the council carries out a financial assessment and contributes on a sliding scale: between £14,250 and £23,250 you contribute £1 per week for every £250 of capital; below £14,250 the council pays for the care itself, though you may still contribute from your weekly income. These thresholds have been frozen since 2010.
One important point that's often missed: when care is delivered at home, the value of your main home is not counted as capital. So someone with a home worth several hundred thousand pounds but modest savings can still qualify for council-funded home care. (This is different from care home placements, where the home's value usually is counted unless a partner or certain other relatives still live there.)
If you do qualify, you don't have to use the council's contracted providers. Direct Payments let you take the money as cash and arrange your own care — the council pays a set rate per hour, and the family can top up the difference to use a higher-rate provider. In practice, the gap between council rates and private-pay rates is wide, and the top-up needed to bridge it is often substantial.
Attendance Allowance.
A weekly benefit for people of State Pension age who need help with personal care, paid regardless of savings or income. It's tax-free and doesn't affect other benefits. The current rates are £76.70 a week if you need help during the day or at night, and £114.60 if you need help during both. Awards are based on care needs, not a specific diagnosis, and you generally need to have needed help for at least six months before payments begin.
It's a top-up rather than a way to fund care — the higher rate works out to about £6,000 a year, which doesn't go far against typical home care costs — but it's worth claiming, and many people who qualify never do. The form is widely considered hard to fill out well; Age UK, Independent Age and Citizens Advice all offer free help with claims.
If you're self-funding, the options.
Most families end up using some combination of these. Which combination depends on the shape of your assets, your view on equity release, and how long the care is likely to be needed.
- 01
Pension income and savings
The most common starting point. Care fees are met from regular pension income, ISAs, and cash savings — topped up by Attendance Allowance once it's in payment. For care needs that are modest or short-term, this is often enough on its own.
- 02
Equity release
For people who own their home and want to release some of its value without selling, a lifetime mortgage lets you draw a lump sum or regular income against the property, with interest rolled up and the whole sum repaid when the home is eventually sold. It can work well for funding home care because it lets people stay in their home; it materially reduces what passes to the next generation, and the compounding interest can be substantial over time. A regulated equity release adviser is essential before going down this route.
- 03
Immediate Needs Annuity
A specialist insurance product where you pay a one-off lump sum and receive a guaranteed income for life, paid directly to a registered care provider. The income is tax-free if it goes to a care provider. It transfers the risk of living a long time in care to the insurer — useful for families who want certainty about ongoing costs but who'd rather not run their savings down. Worth getting independent specialist advice; the lump sum is typically substantial and non-refundable.
- 04
Family contributions
Often part of the picture, particularly where one family member is well-placed to help. Worth doing in writing, with clarity on whether contributions are gifts or loans, and with an eye on the seven-year rule for inheritance tax if amounts are significant. A solicitor or accountant can help structure this properly.
NHS Continuing Healthcare.
For people whose primary need is health rather than social care — for instance, someone with complex, unstable medical needs — the NHS may fund their care entirely, with no means test. This is called Continuing Healthcare. It's assessed against a strict set of criteria covering things like the nature, intensity, complexity and unpredictability of someone's needs.
In practice, eligibility is contested and many initial decisions are appealed. If you think someone's situation might qualify — particularly after a hospital stay, a diagnosis of advanced dementia, or a significant deterioration — it's worth asking the GP or hospital discharge team for a Checklist assessment, which is the first step. Beacon CHC and Age UK both publish good guidance on the process.
We're a private-pay business.
Essentially all our clients self-fund. We occasionally work with clients whose care is funded by NHS Continuing Healthcare, where the funding rate covers our hourly rate or a family is willing to top up. We don't take on local authority funded work directly.
Practically, what this means is that we can give you clear factual orientation on funding options — the means test, Attendance Allowance, the broad shape of equity release — but we're not regulated to give financial advice. For decisions involving the value of a home or a long-term annuity, you'll want a regulated independent financial adviser with a specialism in later-life care. We're happy to point you toward people we've seen families work with successfully.
What people ask us about this.
Will my mother have to sell her home to pay for care?
Not for home care, no. When care is delivered in someone's own home, the value of that home is excluded from the financial assessment — what counts is savings, investments, and other capital. Selling the home is sometimes chosen as a way to release funds, but it's a decision, not a requirement.
The picture changes if care later moves into a residential or nursing home placement. There, the home's value usually is counted, unless a partner or certain other relatives still live there. That's a separate conversation, and one of the reasons families often try to make home care work for as long as it sensibly can.
We've got some savings — should we run them down first?
You can apply for a financial assessment whenever you like — you don't need to wait until savings hit the threshold. If you're close to the £23,250 line and care needs are growing, it's sensible to start the conversation with the council early; assessments take time to arrange and complete.
One thing to be aware of: deliberately giving away assets shortly before applying (to family members, for instance) is treated as deprivation of assets. The council can assess you as if you still had the money, and refuse funding on that basis. Anything significant in this area really needs proper advice.
What's the difference between Attendance Allowance and PIP?
Both are non-means-tested disability benefits, but they're for different age groups. Attendance Allowance is for people who've reached State Pension age. Personal Independence Payment (PIP) is for working-age adults. If you started receiving PIP before reaching State Pension age, you can usually carry on receiving it; you don't need to switch.
The amounts and the assessment focus differ slightly — PIP looks at daily living and mobility separately and pays at four levels, while Attendance Allowance has just two rates. Most older people with care needs are looking at Attendance Allowance.
Is equity release safe?
Modern equity release products sold by Equity Release Council members come with consumer protections that older versions didn't: a no-negative-equity guarantee (you can never owe more than the home is worth), the right to remain in the property for life, and the ability to move to another suitable property without penalty. The market is regulated by the Financial Conduct Authority.
That said, equity release is a significant long-term commitment, the rolled-up interest can be substantial, and it materially reduces what passes to the next generation. Whether it's right for any given family depends on a lot of specifics. The decision needs to involve a regulated equity release adviser, ideally one specialising in later-life lending. We're happy to point families toward advisers we've seen do good work.
Are you regulated, and how can I check?
Yes. Gardiner's Homecare is registered and regulated by the Care Quality Commission. Both our branches are rated Good. Inspection reports are public on the CQC website, and our reviews are independently verified on homecare.co.uk.
Got questions about any of this?
Happy to talk through the maths, or what it would actually cost in your situation. A short phone call is usually enough.
Mon–Fri 7:30am–5pm · Out of hours, leave a message and we’ll call back.
