Will Care Home Fees Wipe Out Your Children’s Inheritance?

The current position

Somewhere between 40,000 and 70,000 homes are sold each year to cover the homeowner’s care fees.  With care costs running up bills of anywhere from £30,000 to £50,000 per year, nest eggs that were built up to provide a children’s inheritance can be quickly wiped out.

How it works

If you cannot afford to pay for long term care privately then the local authority must fund your care. The problem arises when we explore what ‘afford’ means. The local authority will view it as follows:

  • If you have assets above £23,250 no contribution will be made by the local authority as you are considered able to pay it yourself.
  • Below £14,250 a full contribution will be made by the local authority
  • If you have capital between the these two figures there is a partial contribution by the local authority
  • Virtually all your income will also be taken into account

Crucially, in calculating what your assets are, your home is included unless certain other people, such as a spouse, are still living in it.


So the big problem comes when a widow or widower needs long term care as they are forced to sell their home to pay for it. There is of course the same problem if a husband and wife both require care.

Does this seem unfair to you?

Many of our clients tell us that this all seems very unfair to them, because it seems to penalise prudence and saving. Those who have not been careful with their money often seem get their care for free. It is often the case that two residents might be in rooms next to each other with one paying £30,000 pa and the other paying nothing. So many people are looking for ways of preventing their homes being lost if they require long term care.

Can’t I just give the house to my children and continue living in it?

Giving the home away to the children is sometimes seen as the solution, but it is not. This is because the Local Authority can look back and if they can show that this was done to deliberately avoid care fees they will reverse it. There is no 7 year rule. At a time when ALL Local Authorities are cash strapped, they will become increasingly vigilant.

There are other more compelling reasons not to give the house to your children.

  • They can sell the house without your permission
  • If they get divorced or go bankrupt or even die, your house is part of their assets and who knows what might happen
  • When they come to sell the house after your death they may have to pay capital gains tax as it is not their primary residence

Here is an example of the problem, and how we can solve it:

Fred and Hilda are a couple in their sixties with grown up children. Hilda dies after a short illness and leaves everything to Fred in her Will. Because their house is owned jointly, Fred also now owns the whole house. Some years later Fred needs to go into a nursing home and because all of the assets are in his name, his family is forced to sell his house worth £300,000 to pay for his care. Fred lives for a further seven years, during which time the net care home fees have amounted to a breathtaking £250,000. On Fred’s death the amount left for the children has been massively reduced. This problem is increasingly common with our ageing population.

Solution number 1

Fred and Hilda could have become ‘tenants in common’ so that they own half their house each instead of owning it jointly. Then, if Hilda had made a Will which left her half of the home in trust for her children, rather than to Fred absolutely, the children’s inheritance might have been much greater. This is because Fred could have lived in the house up until the time when he needed care. Then his assets would have been means tested, and he could not be said to own Hilda’s half of the house, because it is in trust for the children. So as far as the local authority is concerned Fred’s half of the house counts as his assets (and the assessed value may be very low) – but Hilda’s half of the house is protected for the children.

It could then also be argued in some cases that Fred’s half of the house has little or no value because nobody would buy half a house, which would potentially protect Fred’s half (or the majority of it) too*.

Incidentally, writing your Will in this way also protects your half of the house if your spouse remarries or goes bankrupt after your death – this ensures that your children rather than your spouse’s new step-children inherit your assets.

Solution number 2

While Fred and Hilda are both alive they decide to give their house to their children, but they do it in such a way that the house is held in trust for the children. This means the children have no right to the home until both parents have died. It also avoids any issues with Capital Gains Tax and ensures that Fred and Wilma could sell the house and move to a different one if they chose. Even if one of the children got divorced or died, the assets are protected because they don’t belong to the children.

Importantly, in the example above, when Fred goes into Long term Care, he cannot be said to own the house. Also, because the house was put into trust some considerable time ago, the Local Authority cannot say that they did this purely to avoid care home fees. The house should therefore be protected for the children, whose inheritance is £250,000 more than it would otherwise have been. As a bonus, the children won’t need to go to probate when Fred dies as his house is not part of his estate – this alone can save thousands.

Why not call us today for a free, no obligation consultation to find out how we could help you protect your hard earned assets against care home fees and remarriage.

Call 0800 0934299 today – every cloud really does have a Silver Lining!


  • Linda Parkinson

    29th January 2013

    My grandfather has been told that if he puts the property in his childrens name and he dies within the next 9 yrs and he needs care in this time he would have to pay the care costs and take the house off him any way is this true??

  • Steve99

    30th January 2013

    Hello Linda
    No that is not the case. If your grandfather gives his property to his children and he needs to go into care later on, there is no time limit on how far back the local authority can go. Realistically however, they have to be able to show that when he gave the property away that he had some foreseeability of care, which would be extremely difficult to do after 9 years.
    However, there are other pitfalls involved in simply gifting your house to your children. These range from the problem of one child dying, divorcing or going bankrupt while still owning a share of your property to the children or ‘throwing out’ the person owns the house. Very importantly, when the children come to sell the house there would be capital gains tax to pay on any rise in the price of the property.

    These drawbacks can be got around by transferring the property into a trust rather than into the names of the children. If you would like to know more about this please contact me on 01473 276186 or st steve@silverliningep.co.uk.

    Stephen Wilkes, Adv. Cert. in Will Prep England and Wales
    STEP Aff. Member
    Head of Estate Planning
    01473 276186

  • Steve99

    31st January 2013

    It would depend on why he had put the property in his children’s name in the first place, and care should be taken on this point to avoid deliberately depriving the local authority. There may be a range of reasons why he would want to pass the house to his children in advance.
    As far as the 9 years goes, in my opinion there is nothing in the legislation which suggests a 9 year timescale.

    Hope this helps.


  • freda baxter

    9th June 2013

    If Hilda is about to be put in a home and jointly ownes her house with her husband when she dies what happends to her half of the house? do the government get it or her husband as per her will?

  • Steve99

    10th June 2013

    When she dies her ‘half’ of the house will pass automatically to her husband if he has survived her. But the same also applies if her husband dies first, i.e his share would pass to her. At that point it would very likely be used to pay for her care, so it might be prudent to ensure that her husband does not leave his share to her. He will neeed to sever the tenancy of the property and serve notice on her, then change his Will so that his share of the property is left elsewhere.

    Hope this helps, if you need to know any more please contact me on 01473 276186.

    Steve Wilkes
    Managing Director

  • Wendy Evans

    5th January 2015

    My husband and I made a will last year , John, leaving his half of the property to both our children, and myself having done the same. the property is jointly owned.
    I felt that my husband was changing in that his memory was faultering after he had an anethsetic for a knee replacement, and jumping forward to the future I was worried that should any of us need care, we needed to protect our children`s inheritance.
    It has taken fifteen months to get a dignosis of FTD/Alzhymers/Dysphasia, and as much as it hurts I have had to take out a lasting power of atourney for my husband, and at the time he was able to do the same for me. Should any of us fail to carry out this position, the children are next in line to take over the responsibility.
    Whay I need to know now, is with the will being as such, and the LPA in place, should any of us need to have nursing care, can the property be taken away from us to pqay for carehome fees. I am told that it may be safer to change the ownership to tennants in common, if so, with my husband deteriorating,are we now able to change jont ownership to tennants in common, and will this safeguard the whole of the property for our children.

  • Steve99

    5th January 2015

    Without knowing the full content of the Wills you made it is difficult to be specific and you should not take my views as personal advice.
    When you made the Wills, in order for your husband to have been able to leave his share of the property to the children (whether in trust or absolutely), the ownership of the property should probably have been changed to tenants in common. Without this in place, the property passes to the survivor and is therefore liable to care fees if the survivor needs long term care, as they own it. If the person drafting the Will did not advise this it may have been negligent on their part.
    Depending on the level of your husband’s capacity there are two possible solutions:
    1) If he has the requisite capacity you can both sign a mutual severance of tenance to make the house tenants in common.
    2) If he does not, you can serve him with a notice telling him that you are severing the tenancy unilaterally. This would need to be registered at the land registry, and you should seek advice on how to do this, from ourselves or others.

    Hope this helps

    Steve Wilkes
    Head of Estate Planning

  • Lucia

    3rd May 2015

    Our parental home has just been sold in England to pay for care home fees in Scotland. We know that my parents want each of their 9 grandchildren to have £3k each. Mother passed away in 2002, Dad turns 86 & after what looked like the end for him is now thriving as a Alzheimer’s patient in secure care. I suspect my father has had this illness since mother died and it does explain his behaviour. My siblings think he has some capacity but we granted us shared PoA and told me he no longer feels able to deal with his finances. I know that be wanted to protect his asset for us and he asked my sister to look after it but she declined despite being an accountant who should have known better. Can I sue he for depriving me of my inheritance by failing to discuss the matter with us and failing to put the parental home into Trust.

    I’ve proposed we release £3k for each grandchild now rather than wait until father passes by which time this relatively small sum could be worth even less. I only have I child while my 3 siblings have 8 between them and I do not contest this ‘perceived unfairness’ as it means each grandchild is receiving the same amount.

    As regards how we manage the estate I’ve proposed each of the siblings look after a quarter share and pay one quarter if the care home fees each month by DD.

    My sisters are against this idea and one of them as a millionairess has taken control of my father’s finances. I know that she has split the estate of £180k into 3 of his accounts and arranged to pay care home fees from one of them.

    My father has been assessed as a risk to himself and others and therefore may be eligible for free care.

    Please advise


  • Steve99

    5th May 2015

    Firstly it seems to me that it will be a long and difficult road if you decide to sue your sister for so many reasons. You should seek specialist legal advice before doing so, but on the facts presented it is difficult to see how she could be found personally liable. Transferring your father’s house while acting under an LPA would almost certainly be seen as deliberate deprivation, and it is hard to see how this would be in your father’s best interests.
    Under a Power of Attorney you do not have the authority to start giving assets away before someone dies, other for customary occasions like birthdays. You would need to apply to the Court of Protection to do this.

    Finally, if the care were being provided in England you could apply for full funding, but i have no knowledge of how this works in Scotland.

    Steve Wilkes
    Head of Estate Planning

  • Angela Fitzgerald

    12th August 2016

    My parents original will left half the house to me if one parent died and then the other half to me when my other parent died. My parents then had their will reviewed a couple of years ago and was told that that was no longer legal so the will was changed to the house being left to either one or the other of them which means they are now vulnerable to care home costs. Was this advice correct?


    25th March 2017

    If my wife and I enter into a ‘Tenants In Common’ agreement, what happens if I die. I understand that the house will go to my wife in total. If my wife then has to go into care will the Council take the house to pay for her fees?. I also understand that if she dies then the house will automatically be passed on as per our mirrored will.

    Thank you


  • admin

    25th March 2017

    While it is always difficult to comment on individual cases, i can say that if a couple’s property is owned as tenants in common, their share will pass under the terms of their Will when they die. In order to protect it against being used to pay for the survivor’s care fees, there needs to be a trust in the Will of the first to die. The tenants in common arrangement on it’s own is not enough.
    If you would like more specific advice please give us a call on 01473 358195.
    Stephen Wilkes
    Head of Estate Planning

  • Allister Brimble

    29th December 2017

    It looks like my 80 y.o Dad will have to go into care with both physical and mental issues after a massive stroke. His house has no mortgage. However, my brother (my Dad’s son), now 45 has lived there his entire life and has no savings. My brother, like my Dad has clearly had depression issues his whole life which is why he is still living there and effectively living off my Dad’s pension and his own delivery driver work. Will they take the house into account and if so what would happen to my brother if the care fee’s force a sale?

    I am not particularly worried about my own inheritance here, more what can be done for my brother.

    Thanks in advance for your help

  • Andy Maclellan

    27th February 2020

    Your figures are so wrong. My poor mother(a nurse all her life) and saved and scrimped has had life savings wiped out and now her x council house is about to be taken. She is being charged £86.000 a year so between her savings and the house that’s two years care, it’s disgusting

  • Steve Wilkes

    28th February 2020

    That really is a shocking amount. We to tend to look at averages and sometimes we can forget how mucb more specialised care can cost. As you say, it seems terribly unfair.

  • Rob

    20th June 2020

    Question that never seems to be asked or considered.

    What happens if there is a son or daughter living with the remaining parent and the parent needs care?

    Is the son or daughter has no where to go, are they likely to be on the street if the house is used as asset value towards the care cost ?

    Appreciate your feedback.


  • Steve Wilkes

    22nd June 2020

    There is a rule regarding what’s called the ‘Occupier disregard’. This means that, for example, if your spouse or partner is living in the oproperty then it must be disregarded as part of any means test for long term care.
    If there is a child living in the property, then as long as the child is over 60 it will be disregarded. If the child is under 60 it is at the discretion of the local authority.
    It doesn’t mean that the child will be ‘on the street’. The local autority can place a charge on the property which is usually repayable after the death of the person in care. This might give the child an opportunity to purhcase whatever remains of the property at that time.

  • Robin

    22nd June 2020

    Thank you for your most courteous and kind reply.

    If I may just have a supplementary!

    What if the ‘child’ is in his/her 40’s/50’s and does not have the means to buy the property as they have spent most of their time looking after the parent?

    Many will be in this position.

    1. Could the remaining parent sell the house say for £1 to the son/daughter?
    2. Would a ‘ Tenants in common’ be a possible solution?

    Once again Thank you for your advice.


  • Steve Wilkes

    22nd June 2020

    Age UK produce a really useful factsheet for these situations here https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/fs38_property_and_paying_for_residential_care_fcs.pdf

    Selling the house to the sone or daughter could be seen as deliberate deprivation and is unlikely to avoid payment of care fees if it were done solely for that purpose.
    Becoming tenants in common would require specific advice, but would again require the child to pay a market rate for the property.
    This is only general advice and it seems to me that you may require paid for advice specific to your situation.
    Steve Wilkes

  • Abi

    7th July 2020

    My Nan has left my mums portion of her estate to go into trust for her when my Nan dies. My mum is in care. Will the money/property be used to pay my mums care fees, (currently funded by the local authority)?

  • Steve Wilkes

    8th July 2020

    This will depend on the terms and wording of the trust. In most cases the capital will be preserved but any might have to be paid to go towards the care fees. You should seek specific advice in a case like this.

  • Adele

    8th July 2020

    Hi, My dad has just passed away and was in care for 2.5 years and was part funded- My Mum and Dad jointly owned the house which is now sold and the equity is sitting in their joint account, Mum is now in warden controlled housing. There was no charge on the property for the fees, Does Mum have to pay Dads care fees from his half so she can keep her half of the equity?
    Is there a certain amount allowed that Dad can leave to Mum before the fees are paid?

  • Steve Wilkes

    10th July 2020

    Hwne your father was in care, the property should have been disregarded because your mother was living there. If there was no charge on the property then there should be no future liability.

  • Bella

    18th September 2020

    My mother with dementia has been in a care home for about three months now.
    She is self funding. The savings she has will run out in over a years time, at which point her property would have been sold to pay for her continued care.

    My mother always wanted me to inherit the property and she stipulates this in her will.
    I live in a rented council property. I have a chronic condition which is worsening and I am classed as disabled.
    My question is; would there be any special allowance that would permit me to live in the property, and to inherit it upon my mothers death, as is her wish? I am under 60.

    Because of my disability, my mothers property would be more suitable for me than where I live now.
    My mother would also dearly like for her grandchildren to benefit from the succession of her property,
    which she has worked had to pay for all her life..
    The house has been unoccupied since my mother has been living in the care home.

    Thank you in advance for your replies, I am extremely grateful.
    Kind regards

  • Steve Wilkes

    18th September 2020

    There is a rule that a property should be disregarded by the local authority if a person living in it is incapcitated. Usually though, you need to have been living in the property at the point where your mother went into care. You should seek legal advice about your own situation to see what may be possible. Age UK produce an excellent booklet about this here https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/fs38_property_and_paying_for_residential_care_fcs.pdf
    Sorry we cannot be of more help. This is a very common story, adn there are steps that can be taken to at least protect part of the property, but these teps have to be taken well before the person goes into care.

  • Joanne

    30th October 2020

    My mother is selling her house to move closer to me. If she gives me my inheritance after she sells her house and I buy a house with the inheritance money and have my mum live in the house as a tennant who pays rent, can the government make me sell my house that my mother has been living in and paying me rent if she requires to go into full time care for any reason ?

  • Steve Wilkes

    30th October 2020

    This is a complex situation and you would be well advised to take paid for legal advice before taking the action you suggest.
    The Car Act covers many of the rules when it comes to payment for residential care fees. The local authority would have to show that someone strongly suspected or knew they would need residential care in the future, and that avoiding paying for care must have been a significant reason for giving an asset away. Age UK’s website has some useful information too here https://www.ageuk.org.uk/information-advice/care/paying-for-care/paying-for-a-care-home/deprivation-of-assets/

    I hope this helps.
    Stephen Wilkes

  • Lynne Coles

    10th January 2021

    My husband and I are in our early 70s and both relatively fit. We have a 40 year old son who has never married or left home and still lives with us. My question is, if either my husband or I need to go into residential care, will our house have to be sold to pay the fees, making our son homeless?

  • Steve Wilkes

    11th January 2021

    If one of you went into care the home is usually disregarded. However, if you both require care, or if one of you dies, then the home will eventually need to be sold to pay for your care, unless your son is disabled, or at the discretion of the Local Authority. It may be that the Local Authority would put a charge on your property until you die, but at that point any fees need to be paid.

  • Ethel Robinson

    20th February 2021

    My uncle ,widower, has his will in place. A home made one but well done he has An estate of about £800,000 However, can he write “something “ but not giving anyone PoA that If he needs residential care in future his home ,about £350,000 should be sold right away and put in his pot.? If it is not all used for care how will it effect his bequests ? He has left his home to me, then other people amounts of money .If anything is left I just want everyone to receive something. Any advice welcome

  • Steve Wilkes

    24th February 2021

    I would say that in this case it is really important that your Uncle gets a Lasting Power of Attorney in place. If he loses capacity, a Deputy will be appointed by the Court of Protection. They are under no obligation to act in accordance with any note he has left, although I suppose they might decide to take it into account.
    When somebody is left a legacy in a Will which is sold before their death, the beneficary receives nothing. Your Uncle would be well advised to take this into account in his Will, which i think he should seek advice about rather than trying to do it himself.

  • fred hudson

    8th April 2021

    hi could you please give any advice on how i could save my dads house from being sold to pay for is care .he is in a recite home at the moment .and i have just had the welfare officer down and she is telling me .that i might end up having to sell dads house to help pay for is care/he as dementia by the way .but before he got really bad .he made a will stating that the house was to be left to me and my brother .my mother also said that when she died that the house should be divided.by us both .but i have not got any written proof of this .does my dads will have any impact on this ? AS THIS WAS MADE BEFORE HE BECAME ILL .AND WAS PUT IN CARE . or can my dad claim full care allowance.as he only as 18,000 in savings.any advice would be grateful .AS I HAVE WORKED HARD TO KEEP THIS HOUSE GOING .

  • Steve Wilkes

    9th April 2021

    Mr Hudson
    Sorry for the difficult situation that you find yourself in. A Will only takes effect when somebody dies so this will not make any difference. Usually, if somebody owns a property when they go into residential care then they have to pay for their care. There may be other options available to you, such as the NHS funding his care.

  • Alan Boardman

    3rd June 2021

    I helped to buy my parents house when they had the right-to-buy from the council in 1984, my share was approximately of the purchase was approximately 23%. As the only child I would inherit the estate. however 40+ years later I was forced to sell the house to pay for my surviving mothers care. I have a few documents showing I reduced the purchase price and a signed statement from my mother that this happened but the council have said I’m not in entitled to 23% of the sale price because my parents were the tenants and my name wasn’t on the deeds. I never expected my parent would ever go into care, is there no such thing as a gentleman’s agreement

  • Steve Wilkes

    17th June 2021

    Although we cannot comment on the specifics of your case, it does seem to be a lesson for everybody to make sure that any agreements relating to property are legally binding.
    It may be worth you seeking legal advice to see if this can rectified

  • Rachel Easter

    27th June 2021

    Hi,5 years ago myself and my sister gave our dad money to buy his home,we went to a solicitor to buy the property and also sorted his will so that when he passes the property then belongs to us to do with as we wish.However,his health is deteriorating and mobility is poor so he wishes to go into residential care although he is worried he will be made to sell the property to pay for the care and that we will loose the money that we put forward.Is this the case please or is this less likely because we paid for the property in full and the solicitor put this in the legal paperwork?Is it worth putting the house into a trust?

  • Steve Wilkes

    28th June 2021

    This is a difficult situation if the money was given without any conditions. If somebody owns a property and they need to go into residential care, in most cases the home will be taken into account. We suggest that you initially go back to the solicitor who dealt with the matter to see if they can help. It might also be worth finding out whether they advised on the drawbacks of buying property for older people who might require care.
    If your father owns the property outright, transferring into trust at this stage could be seen as deliberate deprivation of assets and the Local Authority could disregard the transfer.
    As always this advice is of a general nature and you should seek paid for legal advice in relation to your own situation.

  • Linda

    13th February 2022

    Hello. My sister has been caring for my father since my mother died. She gave up her job to move in with him and is his registered carer. She has been living with him for the last 6 years. His health is failing and so we need to find a nursing home for him. We are worried that the local authority will make us sell the house to pay for his care. This could mean my sister will be homeless as she doesn’t have any savings to pay for a house or even rent somewhere and also deplete any savings that my mother would have intended for us children. I don’t think the house is tenants in common sadly. How would the local authority view this?

  • Steve Wilkes

    14th February 2022

    This is a diffcult situation for you all, I’m sure. Firstly you should find out whether your father might qualify for funding by the NHS (it’s not means tested). Otherwise, Age UK produce an excellent factsheet about this subject, and there is lots of other information on their site. You can find the factsheet at https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/fs38_property_and_paying_for_residential_care_fcs.pdf

  • Kitty

    18th February 2022

    My family won the lottery as a syndicate, the cheque was paid into my mums account, then split 5 ways. My brother has lived with my mum and dad for the last 10+ years. So with the lottery winnings they bought their rented home between them. My mum, dad & brothers name are on the deeds. My mum and dad have £50,000 in their joint account. And my mum has 50,000 in her own savings account, which she wants to leave us kids. My dad is now looking like he may need to go into a care home. Will my mum have to pay his fees, and what happens when the money runs out?

  • Steve Wilkes

    21st February 2022

    If somebody goes into residential care, the home is disregarded if there are still certain people living in it. If your Mum continues to live in the property, then it is disregarded for any means test.
    The same means test applies to any money on your Dad’s name, although he may be deemed to own half of any joint savings. When the money runs out the local authority have a legal obligation to care for your Dad.

  • Ruth

    1st April 2022

    My nan had to self fund her care. Is there amount that is protected?. Or does all the money/estate pay for all of the care?

  • Steve Wilkes

    4th April 2022

    The current limit, i.e the amount that is protected, is £23,250, after which you pay less on a sliding scale until your assets reach £14,250. Age UK do an excellent facstheet which explains it all https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/fs46_paying_for_care_and_support_at_home_fcs.pdf

  • Wendy

    19th May 2022

    Hubby and I are considering changing to tenants in common to protect our kids inheritance should one of us go into care.
    My question is this, one parent has died they receive that share in trust for when the other dies . The living parent goes into care then dies. When both parents are dead, could the council demand back dated fees from the estate left to the children?

  • Steve Wilkes

    19th May 2022

    While I can’t give specific advice without knowing the exact details of the situation, there are some general points that I can make.
    In a situation like the one above, depending on the terms of the trust, the council cannot go back and take the other half into account. There are different opinions about why that is (the surviving spouse did not own the other half / it is impossible for the council to put a value on the life interest that the survivor had in the other half) but either way, in our view a council cannot back date any fees for the other half of the house.
    As always, you should seek specific legal advice about your own situation.

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