Deprivation of Assets
Deliberately reducing your wealth to qualify for means-tested benefits like care home funding. Local authorities can ignore such gifts.
Deprivation of assets occurs when someone deliberately reduces their wealth to qualify for means-tested benefits, typically care home funding.
When It Applies
Local authorities will investigate if you:
- Give away money or property
- Transfer assets for less than their value
- Spend unusually large amounts suddenly
- Do this when care needs are foreseeable
The "Could and Would" Test
The authority asks:
- Could the person have foreseen needing care?
- Would they have kept the assets if not avoiding care fees?
If both answers are yes, it may be deprivation.
Consequences
- The local authority treats you as still owning the assets
- You're assessed as if you still have them (notional capital)
- You may not qualify for funding you would otherwise receive
- In some cases, authorities can pursue the recipient of the gift
What Isn't Deprivation
- Normal spending on holidays, home improvements, etc.
- Gifts made years before care was needed
- Spending without intention to avoid fees
Common questions
How far back do councils look for deprivation?
There's no fixed time limit. They look at whether care was foreseeable when you made the gift and your intentions.
Can I give my house to my children to avoid care fees?
If you're already in poor health or care is foreseeable, this could be deprivation. Timing and intention matter.
What about gifts made 10 years ago?
If made when you were healthy and had no reason to expect care needs, they're usually not deprivation.
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