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Paying for care: how the council financial assessment works

In short: Before the council charges you for care, it must check what you can afford. In England, savings over £23,250 usually mean you pay in full, and under £14,250 they are not counted. Your home is not counted if you get care at home. You must be left with a set weekly amount, get a written record, and you can ask for a review.
A friendly drawing of a letter and a pen.

In short

  1. If the council is arranging your care and wants you to pay towards it, it must first check what you can afford. This is called a financial assessment, or means test.
  2. In England, for 2026 to 2027, savings over £23,250 usually mean you pay the full cost. Under £14,250, your savings are not counted, but you may still pay from your income. Your home is not counted if you get care at home.
  3. The council must leave you with a set amount of money each week, and you must get a written record of how your charge was worked out. You can ask the council to look at it again.

Urgent? If someone is in danger or very unwell, call 999. For urgent medical help, call NHS 111 or contact your GP. This page cannot give medical, legal or financial advice about your own case.

Most council care is not free. After a care needs assessment, if you have eligible needs and the council is going to arrange your care, it can ask you to pay towards it. The government's rule is that people should only be asked to pay what they can afford. (Care and Support Statutory Guidance, chapter 8, paragraph 8.2)

To work out what you can afford, the council looks at your money. This page explains how that works, in plain words. The figures are the official ones for the year April 2026 to March 2027. (GOV.UK: social care charging circular for 2026 to 2027)

When the financial assessment happens

Someone from the council may visit you, phone you, or send you a form. You will usually be asked for bank statements, pension letters and benefit letters. Each person is assessed on their own money. The council cannot assess a couple together. (Statutory Guidance, 8.8)

Sometimes a council does a shorter check, called a "light-touch" assessment. For example, if it is clear you have more than enough to pay. If so, the council must tell you, and you can still ask for a full assessment. (Statutory Guidance, 8.22 to 8.26)

Some care is always free

The council must not charge you for (Charging Regulations 2014, regulation 3; Statutory Guidance, 8.14):

The savings limits

Savings and other things you own, like shares or a second property, are called "capital". For 2026 to 2027, the limits in England are (2026 to 2027 charging circular; regulation 12; regulation 25):

These are the lowest limits a council can use. For care at home, a council can choose to set higher limits. Check your council's charging policy. (Statutory Guidance, 8.12)

Tariff income: the weekly amount from savings

If your savings are between the two limits, the council treats you as having £1 a week of extra income for every £250 over £14,250. Any part of £250 also counts as £1. This is called "tariff income". (regulation 25)

Example Working out tariff income. If you have £18,250 in savings, that is £4,000 over £14,250. £4,000 divided by £250 is 16. So the council counts £16 a week as income. This is the same example the official guidance uses. (Statutory Guidance, 8.20)

If you have more than £23,250

You can still ask the council to arrange your care. If you need care at home, the council must arrange it if you ask, but you will usually pay the full cost, and it may charge you a fee for arranging it. For a care home, the council can choose whether to arrange it. (Statutory Guidance, 8.13 and 8.15) Ask the council again when your savings get close to £23,250, so the council can step in in time.

What counts as capital

Capital includes, for example (Statutory Guidance, Annex B, paragraph 6):

If you share a joint account with someone, you are usually treated as having half the money. (Age UK: the financial assessment explained)

What is not counted

Your home

Other things that are not counted

(Statutory Guidance, Annex B, paragraph 33)

What counts as income

Income is money that comes in regularly. The council can count most of it, including (Statutory Guidance, Annex C):

Some income must not be counted (Statutory Guidance, Annex C, paragraph 15; 8.21):

If you get care at home, the Savings Credit part of Pension Credit is also not counted. (Statutory Guidance, Annex C, paragraph 30)

A tip: the council may count benefits you could get but have not claimed. So it is worth getting a free benefits check first. You may be due more money. (Statutory Guidance, Annex C, paragraph 34; Age UK) Our free self-check can help you see what to ask about.

The money you must be left with

If you get care at home: the Minimum Income Guarantee

After your charge, the council must leave you with at least a set weekly amount for food, bills and other living costs. This is called the Minimum Income Guarantee. It comes on top of your rent or mortgage and Council Tax, and on top of your disability-related costs (see below). (Statutory Guidance, Annex C, paragraph 49)

The basic weekly amounts for 2026 to 2027 are (Charging Regulations 2014, regulation 7; 2026 to 2027 charging circular):

Pension Credit age is the same as State Pension age. The amount goes up if you have a child living with you (£106.85 for each child). It also goes up if you would get a disability premium (£51.55 for a single person), an enhanced disability premium (£25.15 for a single person) or a carer premium (£55.25). Lower premium amounts apply to couples. These are minimums. Your council can let you keep more. (regulation 7)

If you live in a care home: the Personal Expenses Allowance

If the council arranges your place in a care home, most of your income goes towards the cost. But the council must leave you with at least £31.80 a week for 2026 to 2027. This is called the Personal Expenses Allowance. (Charging Regulations 2014, regulation 6)

This money is yours, to spend as you wish, for example on clothes, a hairdresser or gifts. The council and the care home must not tell you how to spend it, and it must not be used to pay for care the council has agreed to arrange. (2026 to 2027 charging circular)

The council should think about leaving you more in some cases. For example, if you have a dependent child, or if your home is not counted and you still have bills for it. (Statutory Guidance, Annex C, paragraph 46)

Disability-related expenses

If the council counts your disability benefits, it should let you keep enough to pay for the extra costs your disability or illness causes. These are called disability-related expenses. (Statutory Guidance, Annex C, paragraphs 39 to 41) The guidance lists examples, such as:

The list is not complete. Any reasonable extra cost linked to your disability should be included. Tell the council about every cost, and keep receipts or bills to show it. Many people miss out because nobody asks.

Your written record of the assessment

Once the assessment is done, the council must give you a written record of it. The guidance says it should explain (Statutory Guidance, 8.16):

It should be in a way you can easily understand. You can ask for it in large print, easy read or another format that suits you. (Statutory Guidance, 8.3 and 8.16)

If you think the charge is wrong

  1. Check the figures. Look at the income, savings and costs the council used. Are they right? Has it left you with the right Minimum Income Guarantee or Personal Expenses Allowance?
  2. Check your disability-related costs. Did the council include all of them? This is one of the most common things to get wrong.
  3. Ask the council to look again. Write to the council's financial assessment team. Say what you think is wrong and send any proof. You can use the short letter below.
  4. Make a complaint. If you still disagree, use the council's complaints process. You can use our free complaint letter.
  5. Then go to the Ombudsman. The Local Government and Social Care Ombudsman is free and independent. You usually need to finish the council's complaints process first.

Also ask the council about hardship. If paying the charge would leave you struggling, tell the council. Councils have discretion in how they charge for care at home. (Statutory Guidance, 8.43 to 8.47) Independent Age suggests asking for a review if you do not think the council allowed for all your disability-related expenses. (Independent Age: paying for care at home)

A short letter to ask for a review of your financial assessment

[Your name] [Your address] [Date] Financial Assessment Team Adult Social Care [Council name and address] Dear Sir or Madam, Request for a review of my financial assessment Reference: [your reference number, if you have one] I am asking you to review the financial assessment for [me / name, date of birth], dated [date of the assessment]. I think the assessment is wrong because: - [for example: my disability-related expenses were not included. I spend about £(amount) a week on (extra heating / laundry / a cleaner / a pendant alarm)] - [for example: my savings figure is wrong. My savings are now £(amount)] I enclose [list any bills, receipts or statements]. Please send me a written breakdown showing how my charge has been worked out, including the income, capital and allowances you have used. Please contact me on [phone number] or [email]. Yours faithfully, [Your name]

A word about giving money away

You are free to spend your money as you choose. But if the council thinks you gave money or property away mainly to avoid paying for care, it can assess you as if you still had it. (Statutory Guidance, 8.27 and 8.28) The council looks at why the gift was made and whether you could have expected to need care at the time. Get free advice before giving away large amounts. We will cover this in a separate guide.

Examples

Example A woman who had care at home. She had £9,000 in savings and her State Pension. Her savings were under £14,250, so they were not counted. Her house was not counted either. She paid a small weekly amount from her income.
Example A man with high heating bills. He has a lung condition and keeps his home warm all day. His first charge did not include this. His daughter wrote to the council with his energy bills. The council added his extra heating to his disability-related expenses, and his weekly charge went down.

These are made-up examples to show how things can work. They are not real people. Every case is different.

Free help

If you are thinking about how to pay for a care home over many years, a regulated independent financial adviser can explain your options. Check they are on the Financial Conduct Authority register, and ask about their fees first. Free help from the council and the charities above comes first.

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Information only. This page explains official guidance in plain English. It is not legal or medical advice. Rules can change. For advice about your own case, contact Citizens Advice or another free adviser.

Where this applies: England. Scotland, Wales and Northern Ireland have different rules.

Written by Social Care Made Easy. Last checked: 28 October 2026.