How to fund live-in care: your options in England

You can fund live-in care through benefits such as Attendance Allowance, council support, NHS continuing healthcare, private funds or a mix of these, and which routes are open depends on the person’s needs and finances. Funding rules in Scotland and Wales differ, so this page covers England only.

Live-in care suits people who need help with daily activities but want to stay in their own home. For many families, it is an alternative to a care home, and the main difference is one-to-one support in familiar surroundings, which, when weighed against the price, sets it apart from a care home. The weekly price is a substantial cost, so it helps to understand the funding routes before you decide. A free council needs assessment is the usual first step, and a professional assessment is the only way to know which routes apply to the person.

Key insights

• You can fund live-in care through Attendance Allowance, council support, NHS continuing healthcare, private funds or a mix, and none of these is guaranteed
• NHS continuing healthcare is free, but it is only for people with a primary health need, and eligibility is judged on needs, not on diagnosis
• Attendance Allowance pays £76.70 or £114.60 a week and is not means-tested, but it will not cover the full weekly price
• A council needs assessment is the usual first step, and a professional assessment is the only way to know which routes apply

Can Attendance Allowance help pay for live-in care?

Attendance Allowance is a benefit for people at State Pension age or over who need help with personal care due to a physical or mental disability. It is not means-tested, so savings and income do not change the amount. There are two weekly rates on GOV.UK: £76.70 for frequent help or supervision during the day, or supervision at night, and £114.60 for help or supervision throughout both day and night. It can help towards the cost of live-in care, though it will not cover the full weekly price.

Can you use direct payments to employ a live-in carer?

A direct payment is money your council pays to you, or to someone you choose, so you can arrange your own care instead of the council arranging it. You only qualify after a council needs assessment shows eligible needs, and the council sets the amount.

You can use direct payments to hire care workers or personal assistants, but the money must match your agreed care plan, and most councils ask for evidence of spending. The NHS guidance does not mention live-in carers specifically, so ask your council whether a live-in arrangement is covered. Employing a carer yourself can also bring employer duties such as tax, National Insurance and pension contributions.

What is an immediate needs annuity?

An immediate needs annuity is a specialised insurance product for people who already need care. You pay a lump sum to an insurer, which pays a regular income in return. HMRC’s Insurance Policyholder Taxation Manual says this income is exempt from income tax when it is paid to a registered care provider for the person’s care, as long as the policy meets the qualifying conditions. Whether a live-in service counts as a registered care provider depends on how the care is arranged, so check this before you buy. Terms vary between policies, so speak to a regulated financial adviser first.

Can equity release pay for live-in care?

Equity release schemes allow homeowners to access the money tied up in their home without the need to move out. There are two main types: a lifetime mortgage, which is a loan secured against your home and usually repaid when you die or move permanently into residential care, and a home reversion plan, where you sell all or part of your home but can keep living in it. Both options can provide a lump sum or regular payments that can be used to fund live-in care, but they have different implications for homeownership and inheritance.

Get advice from a specialist equity release adviser authorised by the FCA before taking out a plan, because equity release can reduce or end means-tested benefits and will reduce the value of your estate. If care at home is council-funded, the council may also charge you or ask you to pay more.

Will NHS continuing healthcare pay for live-in care?

NHS continuing healthcare is a free package of ongoing care arranged and funded by the NHS for adults with a primary health need. The NHS pays for a care and support package that meets the person’s assessed health and associated social care needs, and income and savings do not affect it.

Eligibility is based on needs, not on diagnosis or condition, so living with dementia does not on its own decide the outcome. A checklist comes first, and if it is positive, the integrated care board arranges a full assessment. The decision should normally come within 28 days, and anyone eligible can choose a personal health budget. Not everyone qualifies, and a professional assessment is the only way to know whether the person does.

Will the council help pay for live-in care?

Local authorities may offer financial support for people who have been assessed as needing care and support. Whether the council will pay for live-in care depends on two assessments: a needs assessment and a financial assessment. In England, the council generally helps to pay when savings are below £23,250, and it also looks at income. For care at home, the person’s house is not counted. Giving away money or property to reduce savings before the assessment can stop help being offered.

What does self-funding live-in care involve?

Many people self-fund their care because their savings are above the council’s limit. This means using personal savings, income, pensions, or other assets to pay for care.

Self-funding means you decide how care is arranged, and it is worth planning carefully so that funds last for as long as care is needed. The same applies if you arrange a private carer yourself.

Where can you get advice about paying for live-in care/

Age UK and Independent Age both give free advice on care costs and benefits, and they can explain what else may be available for the person’s situation.

What funding is there for veterans?

Veterans of the armed forces may have access to additional funding sources. The Armed Forces Compensation Scheme covers injury or illness caused by service on or after 6 April 2005, and the War Pension Scheme covers service before that date. Both compensate for injury, illness or death caused by service. A veteran on a War Disablement Pension who needs daily care may also be able to claim Constant Attendance Allowance.

Veterans UK and the Veterans Welfare Service can explain what a veteran may be entitled to.

Can the NHS and the council share the cost of care?

In some cases, care costs can be jointly funded by the NHS and local authorities. This is particularly relevant when an individual has both healthcare and social care needs. If someone is not eligible for NHS continuing healthcare but still has health needs, the integrated care board can, with their permission, refer them to the local authority, and the NHS may still fund part of the care as a joint package. There is no charge for the NHS elements, but the council may ask for a contribution towards its part, based on income and savings.

Are there insurance products that cover care costs?

Apart from Immediate Needs Annuities, there are other insurance products designed to cover long-term care costs. Availability varies between providers, so a regulated financial adviser can explain what is currently on the market and whether a policy fits the person’s situation.

Frequently asked questions

Who pays for live-in care in England?

Live-in care can be paid for privately, with help from the council, through NHS continuing healthcare, or with benefits such as Attendance Allowance. Which routes apply depends on the person’s needs, savings and income, and none is guaranteed. A free council needs assessment is the usual first step.

Is Attendance Allowance enough to pay for live-in care?

No, Attendance Allowance pays £76.70 or £114.60 a week, which is a small part of the weekly price of live-in care. It can still help towards the cost, and it is not means-tested.

Does the NHS pay for live-in care?

It can, but only through NHS continuing healthcare for people with a primary health need. Eligibility is based on assessed needs, not diagnosis, and it starts with a checklist. Not everyone qualifies.

Do you have to sell your home to pay for live-in care?

Not necessarily. When a paid carer supports someone at home, the council does not count the house in its financial assessment. Equity release is another way to use the value of the home without moving, but get specialist advice first.

What if the person lives in Scotland or Wales?

Funding rules in Scotland and Wales differ from England, and this page covers England only. The local council can explain what applies where the person lives.

Funding for live-in care in England is complex and varies with the person’s circumstances, and no route is guaranteed. It is worth looking at public and private sources together, so that the arrangement you choose can last for as long as care is needed. Advice from a regulated financial adviser who specialises in care funding, and from your local council, can bring clarity.

If you’re considering live-in care and want to talk through the price and what is included, you can talk to a care advisor before you decide anything.