CAPITAL FUNDING LIMITS
Adult Social Care in England:
adult social care costs
In England, capital funding limits determine whether an individual qualifies for financial support with care costs from their local authority. These limits are set by the Department of Health and Social Care and remain unchanged for the 2025–2026 financial year:
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Upper Capital Limit: £23,250 — individuals with assets above this must fully fund their own care.
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Lower Capital Limit: £14,250 — individuals with assets below this may receive full financial support, based on income.
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Between Limits: Individuals contribute £1 per week for every £250 of capital between the two thresholds
These thresholds apply to care home placements and other care settings. Local authorities may set higher limits for non-residential care, but this is rare. The limits include savings, property (unless exempt), and other financial assets.
Key Points
If you have savings and assets above the upper capital limit (currently £23,250), you are responsible for paying the full cost of your care.
If your capital is below the upper capital limit, your local council may contribute to your care costs.
"Capital" Definition:
Capital includes money in bank accounts, investments, stocks, shares, premium bonds, and property (with some exceptions).
No Reimbursement:
You will not be reimbursed for care costs if your savings fall below the limit before you have contacted your council for a financial assessment.
Annual Review:
The capital limits are set by the government and are reviewed annually, so they can change.
What Happens When You Reach the Limit
Contact Your Council:
You should contact your local council to request a financial assessment to determine your eligibility for support.
Assessments:
The council will assess your savings and assets to determine how much you can afford to pay for your own care.
What to Do Next:
If your savings are below the limit, ask your council to reassess your finances to see how much they can contribute to your care costs.
Summary
In the UK, social care funding is managed by local authorities and has different capital limits in each of the four nations.
England
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Upper Capital Limit (UCL): £23,250. If your capital is above this amount, you are typically considered a "self-funder" and must pay the full cost of your care.
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Lower Capital Limit (LCL): £14,250. If your capital is below this amount, your capital is disregarded in the financial assessment, though you may still need to contribute from your income.
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Between limits: If your capital falls between the UCL and LCL, you will receive some local authority funding but will have to contribute a "tariff income" of £1 per week for every £250 (or part of £250) of capital over the lower limit.
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Proposed changes: A cap on personal care costs of £86,000 was planned for October 2023, along with a more generous means test. However, these changes were delayed.
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Asset valuation: Capital includes your savings, investments, and property. Your primary residence may be disregarded in certain circumstances, such as if a partner or dependent relative continues to live there.
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Deferred Payment Schemes: In some cases, individuals with capital tied up in their property but low income can defer paying care home fees. The local council covers the fees, and the individual repays the debt later, usually when the property is sold.
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NHS Continuing Healthcare: This funding is provided by the NHS for individuals with significant and complex health needs. It is not means-tested, so there is no capital limit for eligibility.
Action
The purpose of this circular, as set out in the Care and Support statutory guidance, is to communicate the changes outlined above.
Local authorities are required to act under the care and support statutory guidance in exercising functions given to them by Part 1 of the Care Act 2014 or by regulations under that part.
Capital limits
The capital limits, specified in regulations made under the Care Act 2014, set the levels of capital (excluding any capital that has been disregarded) that a person can have while qualifying for financial support from their local authority. For people receiving care other than as a permanent resident in a care home, local authorities have discretion to set higher capital limits if they wish.
A person with assets above the upper capital limit is responsible for the full cost of their care in a care home.
A person with assets between the capital limits will pay what they can afford from their income, plus a means-tested contribution from their assets (calculated as £1 per week for every £250 of capital between the capital limits).
A person with assets below the lower capital limit will pay only what they can afford from their income.
For the next financial year (2025 to 2026), the capital limits will remain at their current level: £23,250 for the upper capital limit and £14,250 for the lower capital limit.
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