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The rules around paying for care are set by central Government. View The Care Act 2014 Guidance.
If your disposable capital assets (any money you have that is not tied up in the home you live in) are more than £23,250 then you will not be entitled to financial assistance from Dorset Council. You will be expected to pay the full cost of any care you receive, usually directly to the provider of the care.
You are only entitled to financial assistance from the date you come to us requesting help. It’s your responsibility (or the responsibility of the person with authority to act for you) to ask for help at the time your capital drops below the upper capital limit of £23,250. Once you have completed the financial assessment and provided verification that you are entitled to help with care costs, we are only obliged to backdate funding to the date on which financial assistance was requested.
If your disposable capital assets are between £14,250 and £23,250 then you will be asked to make a contribution from your capital each week towards the cost of your care. This contribution is £1 for each £250 or part thereof.
For example, if you have capital of £16,500, there are 9 lots of £250 between £14,250 and £16,000 and therefore £9 per week will be included in your assessment as income. This amount does not represent any income received on the capital (interest) but is designed to continue to reduce your assets from the upper limit to the lower limit of £14,250.
Where your capital is less than £14,250, you will only be asked to contribute towards the cost of your care from your income.
As part of your financial assessment, our assessment officer will check that you are receiving all the income you are entitled to. Read information about claiming benefits. However, where your circumstances are more complex, or you are not receiving a chargeable service, our welfare benefits team can help you to work out which benefits you can claim. We offer free, confidential and practical advice and we will;
If you are awarded a back payment of benefit at any time you should tell us immediately. This will affect your financial assessment. You may have to pay some of this money to us as part of your assessed weekly contribution.
For the number of your local Citizens Advice Bureau, who can also assist with applying for benefits and form completion, or to get advice via an online web chat visit; www.citizensadvice.org.uk
Discounts are available if you are receiving certain benefits. You may be able to get help with:
If you move into a residential care home and your care is funded by us, you will lose your entitlement to the following benefits 28 days after admission:
Entitlement to these benefits also ends 28 days after you are admitted to hospital.
It is your responsibility to inform the Department for Work and Pensions if you are admitted to hospital or a care home and you receive one of these benefits.
If your placement is funded by a Deferred Payment Agreement (see separate information sheet for details) you are entitled to continue receiving these benefits on the basis that you are ultimately responsible for the full cost of your care.
The Mobility component of DLA and PIP is not taken into account in the assessment of charge.
The financial assessment will be different based on whether you will be having care services in your own home, which includes short breaks away from home (respite), or if you will be in a residential care home or a nursing home.
It will be carried out by one of our financial assessment officers who will contact you by telephone or via a postal application, although in certain circumstances it may be necessary to complete this during a visit to your home. This could be, for example, if you have difficulties using the telephone due to a hearing problem.
Our financial assessment officer will gather information from you so they can advise you of the amount you would have to pay each week towards the care you receive.
We will also check that you are in receipt of all the welfare benefits you are entitled to and may be able to help you claim any benefits, where appropriate.
If we ask for proof of your financial circumstances (for example bank statements) and you don’t provide these by the date requested, the financial assessment will be concluded using the information you have provided. As a result, you may be required to pay the full charge for the services you receive.
We will ask you about your savings and any other assets you have. This could include:
You will be asked to provide information and evidence about these assets such as property deeds, bank statements, savings passbooks or investment documents.
If you have given away or transferred assets to another person, the value of these assets may still be included in your financial assessment.
We will ask about any money you have coming in, which might include:
State benefits are shown on your bank statement as an income, and are identified by your National Insurance Number, and by the letters shown above, next to each payment. Some benefits are paid every 4 weeks so should be divided by 4 to get the weekly payment.
You may also have other money coming in, such as from a property you rent out. You will be asked to provide information and evidence about your income, for example, copies of your pension or benefits statement.
This only applies if you will be receiving care in your home, or if you will be going into a
residential care home for a temporary stay.
This is the money you spend relating to your home, including:
You will be asked to provide information and evidence about these expenses, for example statements or bills. If you do not provide the evidence required, then no allowance will be made in the assessment.
You will also be asked about other housing related expenses such as gas, electric and water. If your payments are more than the amount considered to be ‘the norm’ for the type of property you live in, then we will make an allowance only for the extra amount that you use on a weekly basis. The standard amounts included are set annually by the Government.
DRE only applies if you will be receiving care in your home, or if you are having a respite or temporary residential stay.
Disability related expenditure (DRE) refers to any specific outgoings you have as a result of your disabilities, which enable you to maintain your independence or quality of life.
DRE may take into account some general household expenses that relate to your disabilities or illness. This may include elements of:
These are only examples and you may have other disability related expenses. Each assessment will be based on you and your requirements to maintain an independent life. If you feel you do have DRE you will need to tell is about it and:
A senior financial assessment officer will consider whether any further allowances can be made in the financial assessment and we may need to discuss your request with a member of the social work team. Where additional expenditure is being requested, any allowance made in the assessment will only be for any cost incurred over and above what would be considered ‘the norm’.
If you will be receiving care in your own home or for a temporary period in a care home, we will not take into account a large sum of money each week, which is needed to cover your bills, food and normal living expenditure. This is called the Minimum Income Guarantee (MIG) and for a single person over pension age, it is £189 per week. For a single person who is under pension age it is £131.75 per week. There are a number of other MIG amounts which may be used, depending on your age and personal circumstances. These amounts are set annually by central Government.
Your MIG, home costs and DRE will be deducted from your income and if there is any money left, this is the amount you will be asked to pay towards your care.
If you are going to be living in a care home on a permanent basis then you will be left with a personal allowance which is set by the Government annually. As at April 2019 the weekly personal allowance was £24.90. The remainder of your income will be used to pay for your care.
We will not invoice you if your weekly charge is £2 or less.
If it is decided that you can afford to pay the full cost of the care services you receive, then we may ask you to make an arrangement with the care provider to buy the care direct from them.
If you receive care and support in your own home, the assessment officer will work out the maximum amount you will need to pay per week towards your care. We call this your financial contribution. Your financial contribution takes into account your income, capital (savings and other assets), household related expenditure and, if it applies, your agreed disability related expenditure (DRE).
You will be notified of the amount you need to pay in writing, showing you how it has been calculated. This should be received within 5 working days of the assessment taking place.
If you feel that there is a mistake on the assessment, you can ask to have it reviewed. This must be in the form of a written appeal to the Financial Assessment Team, within 28 days of your receipt of written confirmation of the proposed change.
You are obliged to inform the Financial Assessment Team of any changes to your capital, income and expenditure. The Financial Assessment Team reserves the right to backdate any increased charges which result from a change in financial circumstances that was not notified to the council.
By the time the financial assessment is completed, it is likely that you will have been provided with your indicative care budget. Your social care worker will then develop a support plan with you. This will help you to think about how you want to use your estimated care budget to get the care and support you need. The final personal budget, which could be higher or lower than the original indicative budget will be set once your support plan has been agreed. A personal budget is the money the council allocates you to meet your care and support needs. In order to get the right support, you can choose to employ your own staff, or you can buy the services from a private provider or a voluntary organisation.
More information about the care and support process can be found in our factsheet ‘Adult Social Care – The Dorset Offer’ which is available from our website.
If you will be going into (or are already in) a care home or nursing home, the assessment officer will calculate the amount you need to pay per week towards your care fees and you will be notified in writing, showing how the contribution has been calculated within five working days of the assessment taking place.
If you feel there is a mistake on the assessment you can ask to have it reviewed. This must be in the form of a written appeal to the Financial Assessment Team within 28 days of the written confirmation of the outcome of the assessment.
A Deferred Payment Agreement (DPA) is an arrangement with the council to use the value of your home to pay towards your care home fees. Not everyone is eligible for a DPA.
If you own your own home, this is taken into account in the financial assessment and the assessment officer will discuss your options regarding a DPA. Under this agreement the council may be able to loan you money by securing a legal charge against your home. This will avoid the need to sell your home to pay for care fees until you choose to, or until after your death. Interest is charged on a DPA and there are costs associated with the set up and administration of the loan. If you are eligible for a DPA we will send you further information on how to apply.
If you choose to go to a care home which is more expensive than the amount which Dorset Council is able to contribute, you will have to consider whether someone will pay the shortfall on your behalf. This could be a relative or a friend and is known as a third-party contribution. We will ask the person who will be paying the third-party contribution to demonstrate that they will be able to make this payment as long as you require it by doing a financial assessment on them. If you move into the home before the financial assessment takes place, and the outcome of the assessment is that the third-party contribution is not affordable, you could be asked to move.
You are entitled to give away your assets if you wish to do so. However, it is possible that if you give away assets (e.g. money or property) and it is decided that you could foresee the need for care in the future at the time, the value of any gifts could still be included in the financial assessment. You could be assessed as being able to meet the full cost of your care, even though you no longer have the assets. This is called Deprivation of Assets.
In all cases you or your representative will continue to receive your income into your own bank, building society or Post Office Card Account. It cannot be paid directly to the council or care provider.
For all care services you will receive an invoice from Dorset Council in respect of your assessed contribution, usually every 4 weeks, unless you only receive a Direct Payment. (Read Direct Payments Information Sheet for more information). Residential care accounts are sent two weeks in arrears and two weeks in advance. Non-residential care accounts are sent 4-weekly in arrears. You will be asked where possible to set up a Direct Debit in order to pay the charge.
Your contribution will always be paid towards the cost of your care first and we will assist with any additional costs. If you do not receive a service on a specific day, your weekly contribution towards the care may not reduce as you have been assessed to contribute the amount you have available towards any care services you receive. The reduction in payment will be from Dorset Council’s contribution, unless the total cost of the care received reduces below the amount you have been assessed as being able to pay.
For services received in your own home or in a temporary residential care placement (including respite) you will have to pay for the cost of your care until you reach your assessed maximum ability to pay. This means that if you are assessed with an ability to pay of £100 per week and your care costs £400 per week, you will only be billed for £100 per week. If some of the care is not delivered and the care only costs £150 for a particular week, this is still more than your maximum ability to pay so you will still be charged £100 for that week. You will only see a reduction in your charge if the total cost of the care received in a week falls below your assessed ability to pay.
Care is charged for whole weeks from a Sunday to a Saturday. This means that if you had a week’s respite stay from a Wednesday to a Wednesday, you could be charged for 2 weeks of your assessed contribution as you were receiving care across 2 separate billing weeks.
You can also make payments towards care services in the following ways:
It is your responsibility to inform the Financial Assessment Team of any change in your personal circumstances which could affect your contribution towards your care. This may result in a change to your financial assessment. Such changes include;
A full review of the financial assessment will be carried out regularly. However, we will re-assess your contribution following changes to your capital, income, housing related expenditure or DRE, at any time upon request, up to a maximum of 4 times in a calendar year, or if we are made aware of changes which have not been notified to the team. This is called a financial assessment review and where possible, will be completed by telephone or via the post.
You are responsible for informing the Financial Assessment Team if your financial situation changes. Charges may be backdated if you fail to notify Dorset Council of any changes.
If you have queries about your assessment or do not agree with the financial assessment please contact us
Please contact us on 01305 228762 during office hours:
A Deferred Payment Agreement (DPA) is a loan from Dorset Council. It’s there to help you if you have been assessed as having to pay the full cost of your care home, but can’t afford to cover the fees in full because most of your capital is tied up in your home.
It’s not the same as a conventional loan as we use your home as security. We don’t give you a fixed sum of money when you join the scheme, we pay an agreed part of your care home bill for as long as necessary.
You would enter into a legal agreement with Dorset Council by signing a legal document. If your home is jointly owned with other people, they will also have to sign the agreement. The agreement will explain the responsibilities of the council, and your responsibilities. We then place a legal charge on your property, which is like a mortgage, to safeguard the loan. You will be asked to pay the costs incurred by us in setting up the agreement.
You will pay a weekly contribution towards your care from your income and other savings. The amount is worked out by an assessment of your finances (this is explained in factsheet Paying for Care and Support Services). We pay the part of your weekly bill that you can’t afford, until the value of your home is reached. The part we pay is your deferred payment.
Before entering into a DPA you may want to consider taking independent legal and financial advice. A DPA is one option to meet the cost of your care, but there may be other options available to you.
It’s your responsibility to insure and maintain your property to habitable standard to protect the value of your property. To help with the cost of this, you can keep up to £144 per week from your income.
You can end the agreement at any time. For example, you may sell your home. The loan then becomes repayable immediately. Otherwise the agreement ends on your death. The loan is repayable 90 days after death. We can’t cancel the agreement without your consent.
We will send you a written statement of the outstanding loan for six monthly periods ending every June and December. We will also confirm the amount you owe within 28 days of you making a request.
As part of the application process to join the deferred payment scheme, we are required to do specific checks on applicants, which includes confirming the identity of the person making the application.
If any of the following circumstances apply it will not be possible for us to secure a legal charge on your property. Therefore, we would be unable to enter into a DPA in the following cases until you have taken the necessary action:
If any of these circumstances apply and you wish to be considered for a DPA, it’s extremely important that you start dealing with the issue as soon as possible.
Agreeing to a DPA allows you to claim Attendance Allowance or, if you are under 65 years old, the care component of Disability Living Allowance (DLA) or Personal Independence Payment (PIP) whilst you are in residential care.
You don’t have to sell your house whilst you are alive. If you choose a DPA we will discuss the outcome of the financial assessment, the cost of your care, the equity in the property (we will do an evaluation) and the costs to you in setting up and running the agreement.
You may rent out your home and use part of the rental income to pay your care home fee. The advantages of renting out your property are:
If you choose to rent out your property or allow your property to be occupied by any person, you must first obtain written consent from us. You must also ensure that you have adequate landlord’s insurance which we agree is satisfactory, or the relevant empty property insurance.
If you choose a more expensive residential care home than we can purchase the care for, you can choose to add the amount to the deferred loan (if there is sufficient equity in the property). Alternatively, a top up for this extra amount would be required. The options are:
Our charge for setting up the DPA is currently £804, which reflects the actual costs that the council incurs. There is also an annual administration charge of £100 payable on the anniversary of the agreement. The set-up charge and the annual charge can be added to your DPA, but will also incur interest. These charges cover legal costs, land searches, registry and valuation charges. If you wish to pay the charges separately (and not include them in the loan), you will need to give us 14 days’ notice. Once this notice has taken effect we will invoice you separately for the charges as they become due. If you don’t pay the invoice within 28 days, the cost will automatically be added to the loan and interest will be charged on the amount from that date.
You can ask for a breakdown of the charges at any time, and we will give you notice of any changes. If you choose to add the set-up fee to the loan and then decide you do not want a DPA, you will still be invoiced for any set up fees incurred.
This valuation fee is based on a straightforward desktop valuation. If an internal inspection is required, this fee will increase. If you don’t agree with our valuation figure then you will be asked to arrange and pay for an independent valuation by a Royal Institute of Chartered Surveyors (RICS) registered surveyor, which will be more expensive. This figure can’t be deferred against the agreement.
|First year set up fee (average costs)||Cost|
|Legal costs – straightforward case where an applicant is the sole owner, the property
is registered with the Land Registry and where no other charges are present on the
|Adult Services costs – DPA and financial assessment process||£142|
|Land Registry charges||£51|
|Charges in subsequent years (annual fee)|
|Adult Services admin fee – includes the cost of preparing statements, informing you
of changes in interest charges, obtaining copies of insurance documents and rental
|Revaluation fee (if required)||£152|
The interest rate is the maximum set by the Department of Health and reflects the cost of government borrowing. This rate may go up or down on 1 January or 1 July each year. The current interest rate set from 1 July 2019 is 1.45% per annum. The interest rate is compounded daily.
To apply for a DPA, you must;
To make sure that the money being lent to you can be repaid, we will calculate the lendable equityin your property. This calculation will be based on a desktop valuation. If you don’t agree with the valuation you can obtain your own ‘Red Book’ valuation by a RICS registered surveyor, but you will be asked to meet the cost of this yourself.
We will take 10% off the desktop valuation of the property, to reflect the costs incurred in selling the property. Then we take off £14,250 (as at 1 April 2015), which is the amount under which you will not be asked to contribute towards the cost of your care from your capital (you will still be asked to contribute from your weekly income). Finally, we take off any charges that are secured against the property, for example, mortgages, equity release schemes and secured loans etc.
The maximum amount we can lend you under the DPA is the amount that is left after the deductions set out above. We will ask you not to increase any debts you have already secured against the property, for example, equity release agreements.
Once the amount of your loan reaches 70% of the lendable equity in your property we will undertake a review of your care to discuss how to fund your care in the future. This review will take account of both your care needs and costs.
Should the equity in the property deplete and you become entitled to assistance with funding from the council, there is no guarantee that the we will meet the full cost of the care in the future.
After considering all of the information, and if you still wish to apply, please contact the Deferred Payments team for an application form
If you decide at any time to repay the loan, either in full or in part, then you must give us at least 14 days advance written notice of;
We may decide not to defer further sums if we believe that the lendable equity limit has been reached. If this happens we will try to give you 30 days written notice of the reason not to defer any further payments, but this may not always be possible, for example, if the equity limit is reached because of a fall in the property value.
You must inform us of any other change of circumstance that may affect the agreement. If you are in doubt, please contact us.
Before agreeing to a DPA you may want to consider taking independent financial and legal advice, as a DPA is one option to meet the cost of the care, but there may be other options available to you.
The council does not recommend individual financial advisors, but we can help you find an accredited advisor. We will only signpost you to independent financial advisors who are regulated by the Financial Conduct Authority (FCA) and who specialise in funding long-term care. For example, accredited members of the Society of Later Life Advisors (SOLLA). Some members of SOLLA are also with firms that are members of the ‘Buy with Confidence’ scheme, which mean they are Trading Standards approved. You may find a very good advisor who is not a member of SOLLA. If the advisor is regulated by the FCA, they will adhere to a code of conduct and take responsibility for the suitability of any product they recommend.
Further information about obtaining financial advice is also available from the Money Advice Service website: www.moneyadviceservice.org.uk. Telephone: 0800 138 7777.
If you feel there is a mistake on the assessment you can ask to have it reviewed. This must be in the form of a written appeal to the Financial Assessment Team or the Deferred Payment Team within 28 days of the written confirmation of the outcome of the assessment.
People are allowed to spend their money as they wish. However, ‘deprivation of assets’ happens when you intentionally reduce your assets to avoid using their value towards paying for your care. We can’t tell you not to give way your assets, but can say that by doing so, you are not entitled to receive financial help with care costs from us.
If the we decide that you have given away assets deliberately,we can calculate your assessed contribution towards care costs as though you were still in possession of this asset. This will mean that you would be expected to pay as if you had that asset still available to you when in reality, you no longer own the asset.
Being assessed as having deprived yourself of assets can leave you in a very difficult position as we may refuse to assist with meeting your care costs.
Further information on how we assess your contribution for care can be found in our factsheet ‘Paying for Care and Support Services.
An asset may be money (including savings) or property (e.g. your home). Transfer of assets could include:
To decide whether deliberate deprivation of assets has taken place, we will look at the timing of the gift and what was happening in your life at that time. If it’s decided that the need for future care could be foreseen, and that avoiding a charge for care services was a significant motivation behind the gifts, you will be deemed to have intentionally reduced your assets to avoid them being used in calculations towards your cost of care.
If we decide you have deliberately deprived yourself of assets, we may try to recover any debt and do the following:
You should ensure that you receive independent legal and/or financial advice before utilising your assets or gifting them.
Deliberate deprivation does not occur in every situation. Every case is judged on its own particular facts and an action that could be considered in one case, may not result in the same decision in another case. The final decision will depend on circumstances, intention and timing.
Inheritance tax rules mean that people are able to legally give away assets to avoid paying Inheritance Tax upon their death. If such gifts are made at a time when the likely need for care services could be foreseen, then we could decide that this action constitutes deliberate deprivation of assets.
There is no time scale beyond which we can’t look at gifts made. The decision is always made based on intention, timing and expectation of future care needs.
You can appeal against our decisions through our complaints procedure.
If you would like help from the council we will need to find out if your care needs meet our eligibility criteria.
If you are not eligible for financial help, we may still be able to advise you on the type of support you might need and the organisations that can provide it.
Just (retirement solutions) have made a video that explains what happens when you contact your council for a care needs assessment
If you have mostly healthcare needs and need a nurse to support you rather than a carer, you may be eligible for NHS Continuing Healthcare.
Our top ten things to think about will help you to plan your future care, even if you don't need support at the moment.
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