The Complete UK Guide to Care Funding (2025/26)
One of the biggest anxieties for families in the UK is how to pay for long-term care. With the recent scrapping of the proposed “care cap,” the landscape remains a complex mix of local authority assessments, means-testing, and self-funding.
This guide provides a clear, national overview of how the system works in 2025 and 2026, helping you understand your rights and the financial support available.
The Two-Step Process to Funding
Before a single penny is discussed, every individual in the UK is entitled to a clear pathway of assessment.
Step 1: The Care Needs Assessment
Regardless of your bank balance, your first step is always a Care Needs Assessment from your local council. This is a free service where a social worker evaluates physical and mental health to determine the level of support required.
National Rule: You cannot access council funding without this assessment.
Step 2: The Financial Assessment
(The Means Test)
If the Needs Assessment confirms care is required, the council will conduct a Financial Assessment and look at:
Capital: Savings, investments, and (in some cases) property.
Income: Pensions and certain benefits.
2025/26 Funding Thresholds (England)
In England, the amount you contribute is determined by three “capital bands”. Note that these figures differ significantly in Scotland and Wales (see our [National Variations] section).
Above £23,250
(Self-Funding)
You are responsible for the full cost of your care. You are known as a ‘self-funder’.
Between £14,250 and £23,250 (Partial Funding)
The council helps pay, but you contribute from income plus a “tariff” from your savings
Below £14,250
(Full Funding)
The council pays for your care (though you still contribute most of your weekly income/pension).
Crucial Note: For Home Care, the value of your property is never included in the means test. Your home is only considered if you are moving permanently into a residential care home.
National Variations: Scotland, Wales, & NI
If you are looking for care outside of England, the “safety net” is different:
- Scotland: Provides Free Personal Care for those over 65 who have been assessed as needing it, regardless of income. Capital limits for residential care are also higher (£35,000 upper limit).
- Wales: Offers a more generous capital limit of £50,000 for residential care, and a maximum weekly charge for home care (currently capped at £100/week).
- Northern Ireland: Generally follows a similar threshold to England (£23,250), but with different rules regarding nursing care contributions.
Next Steps for Families
Common Funding Questions
FAQ 1: What is NHS Continuing Healthcare (CHC)?
If your primary need for care is health-based (e.g., complex nursing needs) rather than social-based, the NHS may pay for 100% of your care costs, regardless of your wealth. This is not means-tested but has a very high eligibility bar.
FAQ 2: What happens to my property?
Your property is not included in the means test if your partner or certain other relatives still live there. For home care, the value of your home is never included. If moving into a care home, you may be offered a ‘Deferred Payment Agreement’ where the council helps with fees, which are repaid later from the sale of the property.
FAQ 3: Will I have to sell my home?
Not necessarily. Your home is ignored if your partner, a relative over 60, or a disabled relative still lives there. Additionally, for the first 12 weeks of permanent residential care, the council must ignore your property value to give you time to decide your options.
FAQ 4: Are there any benefits I can claim?
Yes. Make sure you are claiming Attendance Allowance. This is a non-means-tested benefit for people over State Pension age who need help with personal care. It is not taxable and can make a significant difference.
FAQ 5: Can I give my money away to avoid care fees?
Local authorities look for “Deprivation of Assets.” If they believe you have gifted money or property specifically to avoid care costs, they can assess you as if you still own that money.