Means-Tested Care Cost Calculator

Complete Guide to the Care Means Test

What Is the Care Means Test?

The means test is the process by which local authorities in England assess how much of your care costs you should pay yourself, and how much they will fund. It is governed by the Care Act 2014 and detailed in the Care and Support (Charging and Assessment of Resources) Regulations 2014. Everyone who requests local authority care has a legal right to a financial assessment.

The means test differs depending on whether you receive care in a residential setting (care home) or in your own home (domiciliary / home care). The key difference is that property value is included for residential care but not for home care. This distinction can be enormously significant for homeowners.

Capital Thresholds (England 2026)

England uses two capital thresholds:

• Upper threshold: £23,250 — Capital above this means you self-fund entirely. The local authority will not contribute to your care costs until your capital falls below this level.
• Lower threshold: £14,250 — Capital below this is completely disregarded. The council assesses only your income, not your capital. You are entitled to LA-funded care based on income only.

These thresholds have not been significantly uprated in many years and represent one of the most controversial aspects of the UK care funding system. The government has proposed a care cap of £86,000 on personal care costs, but as of 2026 this has not been implemented.

Capital Tariff Income Calculation

When capital falls between £14,250 and £23,250, the council applies a "tariff income" rule. For every £250 (or part thereof) of capital above £14,250, you are treated as having £1 per week of notional income from that capital, regardless of whether it actually generates any income. This tariff income is added to your real weekly income when calculating your contribution.

Example: Capital of £17,500. Amount above lower threshold: £17,500 − £14,250 = £3,250. Tariff: £3,250 ÷ £250 = 13. Tariff income = £13 per week. This is added to your actual pension/benefit income to calculate your total assessed contribution.

Income Disregards

Not all income is counted in full. Key disregards include:

• Pension Sharing Disregard: If you are married or in a civil partnership, 50% of any occupational or personal pension income is disregarded. This prevents care costs from impoverishing a spouse who remains at home.
• Housing costs (home care only): Rent, mortgage interest, and some service charges are deducted from income before calculating contributions for home care.
• Attendance Allowance: The position on this varies — in some circumstances it may be disregarded for home care but included for residential care. Confirm with your council.
• War pensions: Certain war pension payments are disregarded under regulation.
• Earnings disregard (home care): For those in work receiving home care, some earnings may be disregarded.

Minimum Income Guarantee (Residential Care)

For residential care, the law requires that after paying your assessed care contribution, you must retain at least the Minimum Income Guarantee (MIG) for personal spending. This is currently £30.15 per week for a single person (the "Personal Expenses Allowance"). The local authority cannot require you to contribute more than your income minus this protected amount.

For home care, a different protected income floor applies — the council must ensure you retain enough income to meet essential living costs. The calculation is more complex and varies by council.

Home Care Charging Reform

The charging framework for home care has faced criticism for inconsistency between local authorities. In 2022 the government consulted on a "Care Cap" model that would have limited individual care spending, but implementation was delayed. As of 2026, home care charging continues under the pre-reform system. Different councils may set different maximum weekly contributions for home care — known as the "individual service fund" or ISF cap. Check with your specific local authority for their current charging policy.

Direct Payments

Under the Care Act 2014, eligible people have the right to request a Direct Payment — cash paid to them instead of the council arranging care services. You use the money to buy your own care, which could include employing personal assistants, purchasing services from independent providers, or a combination. Direct payments give maximum flexibility and control. You must still contribute your assessed share; the Direct Payment covers the council's portion of the care cost.

Direct payments require record-keeping and reporting. You cannot use them to purchase care from a close family member living in the same household (unless the council agrees in exceptional circumstances). An independent user trust or managed account can help manage the administrative burden.

Third-Party Top-Ups

If you choose a care home that costs more than the council's standard rate, and the council agrees the placement is appropriate, a third party (usually a family member) can pay the difference — called a "top-up fee." The council must ensure there is at least one suitable home available at their standard rate; if they cannot, they may bear the additional cost. Top-up arrangements must be formalised in writing. The person in care cannot usually pay top-up fees from their assessed capital.

Worked Examples