UK: ‘Death tax’ to force more to use family home to pay for care

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PM Theresa May has announced reforms that will see tens of thousands more people expected to use the family home to fund the costs of their home care.

Currently only people going into residential care have the value of their property means-tested.

Ms May has promised no one will be forced to reduce their assets to less than £100,000 to pay for home or residential care, or sell their house while still alive or while a surviving spouse lived there.

This figure would replace the current benchmark of £23,250 used to means-test care.

However, the costs would be recouped by selling the property when they died – and why the move has been labelled as a “death tax” by some.

The change is expected to make the Treasury over £1.3B a year. This money would then be used to fund care costs for people whose assets fall below the £100,000 threshold and are being paid for by local governments.

The UK currently has no cap on aged care costs. A recent commission called for a cap of £35,000. The coalition had legislated for a £72,000 cap but this was shelved back in 2015 by David Cameron’s Government.

Experts have said that the measures could save around £200M a year, but Labor has blasted the proposal.

“It’s the Tories who have pushed social care into crisis; their cuts to councils have meant £4.6B axed from social care budgets between 2010-2015, leaving 1.2M people struggling to get by without care,” Shadow Minister for Social Care Barbara Keeley said.

The UK has around 300,000 aged care beds for its 70M population. Contrast this to Australia, where we have 190,000 beds for 24M.

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