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The Dementia Tax

An increasing number of people with homes and other assets are becoming aware that they are under siege. The Government and local Councils are looking at their homes, pensions and other wealth; wondering how they can get hold of it for their own use.

This is not something new!

For the last 17-years I have watched one Government after another, both Conservative and Labour, try different schemes to do this.

The latest in a long line of schemes is The Dementia Tax. Prior to this we had The Lifetime Fee Cap. Prior to this we had the secured loan scheme.

When we look at what they are all attempting to do it is this:

Government is bad at budgeting and controlling budgets. The Health Service, Local Councils and the Social Welfare system are all in trouble and they have been for many years.

Elder care has been a problem area for decades. It has been mismanaged and under funded for a long time.

During these decades and up to about the years 2006/7 older homeowners were having to sell their homes to pay for Care and Health support. The accepted Government figure is that about 65,000 homes were sold each year to pay for Care. This process took large amounts of wealth from older homeowners.

This did not take account of those who did not want to sell their homes and who found that their local Council had put a legal charge over the property so that they could recover the costs of care, and interest once the person died.

Your local Council can't make you sell your home to pay for Care. However; you will find that you are put into difficult situations and under so much pressure that you will be forced to do so by circumstance.

Why did things change ins 2006/7?

This is when the recession hit and large amounts of money simply disappeared. The budgets that had been available for Care at Home disappeared and suddenly Homeowners needed to pay for things which were free until then. The process of homeowners having to pay for Care at Home was always going to occur; they were just being warmed up for it. The recession simply brought this process forwards.

There is an odd situation with local Councils. They are allowed to interpret National Legislation and impose local rules related to providing Assessments for Care and Support. As their budgets reduced their criteria for Assessing people became harder and it became more difficult for people to receive support that they did not have to pay for.

This process of making it harder for older people with wealth to receive support has caused more older homeowners to pay out more money for Care at Home and also for Care and Nursing Care.

As a result, since 2006/7, more older homeowners would have had to sell their homes to raise the money to pay for things which were previously free. In my estimate I would say an additional 10-15,0000 homes are having to be sold.

Why are older homeowners being targeted in this way?

For many decades it has been easy for Central Government and local Councils to put older homeowners under pressure and to squeeze money out of them. This lead to the annual sale of 65,000 homes and the lose of savings and income from many thousands of older people.

For the last 5-years or so the narrative from Government is that the old homeowners have all the wealth and that this is depriving the young of opportunities. It is creating a division between young and old and making old people into the enemy of the young.

This is being done to try and make it easier to introduce new legislation to allow Government and local Councils to have control and access over the wealth that someone has accumulated over their lifetime.

This whole process is unjust and unfair but Government will use it to access the wealth of older people if it can. If the young feel disadvantaged by the older generations then they will not object when draconian legislation takes that wealth away from older people.

In reality your local Council already has powers that most people don't realise they have.

For example:

Empty Dwelling Management Orders. These allow your local Council to take over property that has been empty for 6 months or more and to turn it into Social Housing. To recover the property the owner needs to go to Court.

The Deprivation of Assets Rules. This is Legislation that stops older people from disposing of their assets or from using that wealth in certain ways. If you do the wrong thing you can be treated as if you still have ownership and use of wealth that you have given away; this can cause tremendous difficulties when people are caught by this.

Making up their own Rules. Your local Council is allowed, within limits, to make up its own rules and apply them. In my experience Councils can act illegally in their decision making and in the actions that they take.

Asking people to sign over their homes in exchange for an undertaking that the homeowner will not have to pay care fees.

As you can see the new Dementia Tax is the latest in a long process of trying to access the wealth of older homeowners.

What can you do about it?

The reality is that Government and your local Councils want this problem to be complicated and difficult so that most people don't understand it. This complexity stops older people from understanding the problem and from taking action at a time when they can take action.

By delaying you from taking action until such time as you know that you have a problem and that you need to do something about it; it is usually too late and you have been caught by the Deprivation of Assets Rules.

This is a simple but effective way that many older homeowners are caught our by the System and, as a result, they lose all their wealth.

To be able to manage situations like this you need a solution such as My Best Friend.

Can homeowners really lose all of their money?

Yes they can literally be left penniless and not even be able to pay for clothing, personal items and their funeral.

How does this happen?

Much is being made by Government that older homeowner will be left with some of their wealth to pass on to the next generation. In reality this is a red herring as only applies to Means Testing related to specific Care expenditure.

Outside of the tightly controlled qualifying criteria for Care expenditure there are other Means Tested items that are not limited by any cap.

This is one of the ways that Government and local Councils cheat and lie to people to encourage them to lower their defenses and lose their wealth.

All the proposals that I have seen over the last 17-years have practiced deceptions on the elderly to make them believe that they will have more money that they actually will or that they will lose less money than they actually will.


If you are worried about this you should book a fixed price home visit and find out about The My Best Friend Solution for Homeowners over 55.

Contact David on 07787 503646 to make an appointment.