My husband and I live separately, so how would this affect care bills?

My husband and I live in two separate flats in the same retirement block (though location is immaterial – we could be living miles apart).

We are joint tenants of both properties. We paid stamp duty as a second home for the second flat.

He pays council tax as a single person for one flat, I pay council tax as a single person for the other (this has been sanctioned by our council). One flat is worth around £70,000 (his) and one £100,000 (mine).

Separate flats: How do the rules on property and care bills apply when a couple are living in different homes (Stock image)

We live independently in each property but pay bills, service charges, and so on from a joint bank account.

What is the situation if one of us goes into a care home?

When it does come to that point, our plan is for the larger flat (whoever it is who has gone into care) to be sold with the smaller flat being the only residence of the person remaining.

We get almost exactly the same state/private pensions per month, within a few pounds per month.

Tanya Jefferies, of This is Money, replies: What will happen when one partner starts needing care is a common concern for older couples.

Yours is an unusual situation, so we asked a lawyer experienced in this area to explain how the rules on property and care bills might apply in your case.

James Urquhart-Burton, partner at Ridley & Hall Solicitors, replies: I warn you that it is not an easy read, but the full details of the charging regime for care and support can be found in official government guidance here. 

The starting point is that people should only be charged in a way which they can afford and assessments by local authorities should be person-focused, reflecting the fact that both relationships and caring journeys come in all shapes and sizes.

James Urquhart-Burton: People should only be charged in a way which they can afford

James Urquhart-Burton: People should only be charged in a way which they can afford

What will happen if one or both of you needs care and support?

It will be for the local authority to undertake an assessment of your needs, and thereafter a financial assessment must be carried out if it intends to charge you for care and support.

The local authority should only assess the income and capital of the person who is the subject of the financial assessment.

This means that if only one of you needs care, then they will only be able to take into account that person’s capital and income.

For this reason, assessment of a couple’s capital can be complex.

I should just say that if you need care but it can be provided in your home, then the value of your home is disregarded from the financial assessment.

If that isn’t the case and placement in a care home is necessary and you jointly own your home, the local authority will usually assume that each of you has the benefit of an equal 50/50 split.

How is the assessment handled when a couple live together?

The situation is more straightforward for married couples who occupy the family home together, because they will benefit from the ‘mandatory disregard’.

That means that should one of them go into a care home and the other remain in the family home, the local authority is required to disregard the resident’s interest in the property.

The logic behind this is that the spouse still living in the property should never be forced to move from their home to pay for their spouse’s care.

What if a couple live apart?

In your case, you each own both of your flats as joint tenants and you each reside in one of those flats alone.

Let’s assume your husband needs to go into a care home and you don’t. The flat in which he lived is now empty, and you each own it as joint tenants, so there is a presumption that you are each entitled to a 50/50 split of the equity.

Your husband’s 50 per cent share of the flat he was living in will be taken into account for his financial assessment, particularly because the flat is now vacant.

You say that flat is worth around £70,000. This would mean he has £35,000 locked up in the flat (assuming no mortgage debt) and this would place him above the upper capital limit of £23,250, so he would need to self-fund his care for a time if his income is not sufficient to meet the cost of his care up front.

The same would happen if the converse situation arose with you and the flat you are living in.

Your husband’s share of the flat in which you are living is not so straightforward. 

You could ask the local authority to exercise its discretion to disregard your husband’s share on the basis that it is your home, or alternatively, on the basis that his share has no open market value, because you, as the co-owner, are living there. 

If a dispute arises with the local authority, seek independent legal advice. 

What action could you take (within the rules) to limit potential care bills?

Local authorities tend to be suspicious of changes in ownership or residence which appear to have occurred to circumvent the care charging rules, but it strikes me that there are a couple of steps you could take to ensure that you and/or your husband do not spend more than you need to.

If there are other people you would like to benefit from your estates when you die, you should give some thought to ‘severing’ your joint tenancies on both flats.

That would mean that going forward you would hold them as ‘tenants in common’, each with a 50 per cent share.

You could then make new wills leaving your shares to whomever else you wish, but still giving each other a ‘life interest’ in the properties.

If the surviving partner out of the two of you needs to go to a care home, the last thing you want is for that person to have inherited everything, only to have to spend it all on care fees.

You should also give some thought to splitting your joint account and ensuring that your incomes and outgoings are kept separate.