The care home means test, explained
When you move into a care home in England, the council works out how much you should pay using a financial assessment, the means test. Whether the council contributes comes down to two capital thresholds and what counts toward them.
The two thresholds
- Above £23,250 in capital: you pay the full fees yourself (a self-funder).
- Below £14,250: your capital is ignored. The council funds your care and you contribute only from income.
- Between £14,250 and £23,250: the council helps, but you pay a ‘tariff income’ of £1 a week for every £250 of capital in this band, on top of your income contribution.
These thresholds have been frozen for several years. A planned reform to raise them to £20,000 and £100,000 was scrapped, so the figures above are current.
Means testing for care across the UK
The means test is a capital test, and the cut-off is different in each UK nation. In England and Northern Ireland you pay the full fees once your capital passes £23,250. In Scotland the cut-off is £35,500 from 6 April 2026. In Wales it is £50,000 for residential care, the most generous limit in the UK. Everything else on this page is the England system.
| Nation | Pay in full above | Capital ignored below |
|---|---|---|
| England | £23,250 | £14,250 |
| Wales | £50,000 | No separate lower limit |
| Scotland | £35,500 | £22,000 |
| Northern Ireland | £23,250 | £14,250 |
The personal spending money you keep also differs: England allows a Personal Expenses Allowance of £31.80 a week for 2026/27, and Northern Ireland allows £27.19 a week. Wales sets a single capital limit for residential care rather than a two-threshold system, so there is no tariff income band to work through.
Sources, all checked 7 September 2026: England, GOV.UK local authority circular, social care charging for care and support 2026 to 2027 (capital limits held at £23,250 and £14,250; PEA rising to £31.80). Wales, GOV.WALES charging for social care. Scotland, Age Scotland and Independent Age care funding guides (upper £35,500, lower £22,000 from 6 April 2026). Northern Ireland, carehome.co.uk Northern Ireland funding guide (capital limits £23,250 and £14,250, PEA £27.19).
What counts as capital
Capital means savings, investments, premium bonds, most property and land. The big question for most families is the home.
When your home counts
Your home is included as capital unless one of these people still lives there: a husband, wife or partner; a relative aged 60 or over; a relative who is disabled; or a child under 18 you are responsible for. If the home is disregarded for one of these reasons, it is not counted at all.
Even when it does count, it is ignored for the first 12 weeks of a permanent stay (the 12-week property disregard), giving you time to plan. A deferred payment agreement can then let the council pay your fees and recover the money from your estate later, so you may not have to sell the house while you are alive.
Income and the Personal Expenses Allowance
If the council funds your care, you contribute most of your income (pensions, some benefits) toward the fees, but you keep a Personal Expenses Allowance of about £31.80 a week for personal spending. Attendance Allowance usually stops once the council is funding residential care.
Top-up fees
The council only pays up to its own rate. If you choose a home that charges more, someone else, usually a family member, may have to pay a ‘third-party top-up’ to cover the difference. The resident cannot normally top up from their own income. Be sure any top-up is affordable for the long term before agreeing.
How to get assessed
Ask your local council’s adult social services for a care needs assessment first, then a financial assessment. Both are free. See how to pay for a care home for the full route, or estimate your position with the calculator.
The detail on this page is the England system; the UK table above shows how Wales, Scotland and Northern Ireland differ. This is general information, not financial advice. Confirm your position with your council or an independent financial adviser.