Care Home Fees & Tenants in Common: What You Need to Know
When planning for the future, many people ask: can owning a property as tenants in common protect you from care home fees? The short answer is — it might, but the full picture is more complex. In the UK, care home fees can be significant, and how your home is owned plays a role in whether it’s included in means testing.
This article explores how tenants in common agreements can be used as part of a legal strategy to manage care costs and preserve assets for your loved ones. We’ll explain the difference between joint tenants and tenants in common, what the law says about care fee assessments, and how to take steps to protect your home.
For personalised support on care fee protection strategies, visit our Care Fees Protection page or book a free consultation with one of our estate planning experts.
Understanding Property Ownership: Joint Tenants vs Tenants in Common
How you own your home with someone else affects how it’s treated in legal and financial matters. There are two main types of co-ownership in England and Wales:
- Joint Tenants: You both own 100% of the property. If one of you dies, the other automatically inherits the whole property.
- Tenants in Common: You each own a specific share of the property (usually 50/50, but it can be any ratio). You can leave your share to someone else in your will.
Tenants in common ownership gives each party legal control over their share of the property, making it a valuable tool in estate planning and potential care fee protection.
How Care Home Fees Are Assessed
In the UK, if you require long-term care in a residential facility, the local authority may assess your finances to determine how much you need to contribute. This is known as a means test. Here’s what they look at:
- Your income (e.g. pensions, benefits)
- Your savings and investments
- Your share in any property you own
As of 2024, if your capital exceeds £23,250 in England, you are expected to pay for your own care in full. If your capital is between £14,250 and £23,250, you contribute on a sliding scale. Below £14,250, the local authority covers the cost.
What About the Family Home?
The home is usually included in the means test, but not always. It may be excluded if:
- A spouse or civil partner still lives there
- A relative aged 60 or over lives there
- A dependent child or someone with a disability lives there
If none of these apply, the value of your home could be taken into account, and you may have to sell it to fund care costs — unless you take action in advance.
How Tenants in Common Can Help Protect Your Home
Many couples who jointly own their property convert to tenants in common as part of a care fees planning strategy. Here’s how it works:
- You and your partner change ownership from joint tenants to tenants in common.
- You each make a will leaving your share of the property into a Property Protection Trust for your children or other beneficiaries.
- When the first partner dies, their share is held in trust — not passed to the survivor outright. This means it’s not counted in the survivor’s assets if they later need care.
This strategy doesn’t stop the local authority from assessing the survivor’s half of the property, but it can potentially protect the half held in trust — keeping it safe for your children.
What About Deliberate Deprivation of Assets?
It’s important to note that if you transfer assets specifically to avoid care fees, the local authority may treat this as deliberate deprivation. They can ignore the transfer and still include the value in the means test.
However, converting your home to tenants in common and creating wills with trusts is usually considered legitimate estate planning — especially if done well before care is needed and with professional advice.
To avoid any accusations of deprivation, always seek advice from experienced estate planners or solicitors. Our team at MP Estate Planning can help you book a consultation here.
Example Scenario: Tenants in Common and Care Fees
John and Susan own their home as joint tenants. They decide to change to tenants in common and each make a will leaving their 50% share into a trust for their children. Years later, John passes away. His half of the house goes into trust.
Susan later needs residential care. When the local authority does the means test, only her 50% share of the home is counted. John’s half is in trust and is not available to Susan — meaning it’s protected from care fees.
This is a simplified example, but it illustrates how powerful this strategy can be with proper planning and timing.
Does It Always Work?
No strategy is guaranteed, and the rules around means testing can change. However, planning ahead gives you more options. Owning your home as tenants in common is a practical, low-cost step you can take now as part of wider care fees protection.
Even if you’re not ready to set up trusts or rewrite your wills, changing your property ownership structure can make a difference later on.
Other Tools to Help with Care Fee Planning
- Property Protection Trusts: Built into your will to secure your share of the home for your beneficiaries.
- Asset Protection Trusts: Created during your lifetime to hold and manage your assets.
- Lasting Power of Attorney: Appoint someone you trust to manage your affairs if you lose capacity.
Learn more about how these options work together on our Care Fees Protection page.
Key Takeaways
- Tenants in common lets you own defined shares of a property, which can be left in trust when one partner passes away.
- Using this strategy, the deceased’s share may be protected from future care fee assessments.
- This planning must be done carefully and in advance to avoid deliberate deprivation claims.
- It’s essential to work with qualified professionals for legal and financial guidance.
Conclusion: Start Planning Now to Protect Your Home
Care home fees can seriously impact the assets you hope to pass on to your family — especially your home. Choosing to own your property as tenants in common and using a will-based trust is a smart way to start protecting what matters most.
If you want to explore this option further or get personalised legal advice, book a free consultation today with MP Estate Planning. We’ll walk you through your options and help you make informed, secure decisions.
And for transparent, affordable support, check out our pricing page to see how we can help without breaking the bank.