Bonds and long-term care in England

Local authorities have an obligation to provide residential accommodation ‘for persons who by reason of age, illness, disability and other circumstances, are in need of care and attention which is not otherwise available to them’ under section 21 of the National Assistance Act 1948. 

For clients in England, the way local authorities assess income and capital for care fees can have a major impact on financial planning decisions.

This briefing note explains how investment bonds are treated in care and support means‑tests, how the current guidance distinguishes between capital and income, and when deprivation of assets concerns may arise. It is intended to help advisers and families understand the opportunities and limitations of using bonds in care funding strategies.