Financial Assessment
This procedure has been written to support practitioners who are not responsible for carrying out the financial assessment process.
It will help them to provide information and advice about financial assessment, understand their responsibilities within the process and work effectively alongside the team responsible for carrying out assessments.
Although this procedure may be helpful to those based within the team responsible for financial assessment, it does not provide specific guidance about the process of carrying out a financial assessment, or of any other subsequent action that may be required. Anyone carrying out such actions should refer to the following as required:
- The Care and Support (Charging and Assessment of Resources) Regulations 2014;
- Care and Support Statutory Guidance.
There is also information in the 'Charging and Assessing Financial Resources' section of the Care Act 2014 Resource.
Information about all the following can be found in Assessment of Financial Resources, which is a section of the Care Act 2014 Resource:
- The purpose of a financial assessment;
- General principles of financial assessment;
- When to complete a financial assessment (and when not to);
- Methods of financial assessment;
- Financial assessment for people who lack capacity or do not manage their own finances;
- Financial assessment of people in a care home;
- Financial assessment of people living in the community or other settings;
- Financial assessment of carers;
- Examples of what must be taken into account when carrying out a financial assessment;
- Examples of what must be disregarded (or partially disregarded) when carrying out a financial assessment;
- Deciding how much to charge;
- Communicating the outcome of a financial assessment.
Note: All financial assessments must be completed in accordance with The Care and Support (Charging and Assessment of Resources) Regulations 2014.
Unless prevented from doing so under the Care Act, the Local Authority is permitted to charge for any Care and Support services that it provides. The services that the Local Authority must not charge for under the Care Act are:
- Intermediate care or reablement services for up to 6 weeks;
- Aids and minor adaptations up to the value of £1000;
- After-care services/support provided under section 117 of the Mental Health Act 1983;
- Any service provided to a person with a diagnosis of Creutzfeldt-Jacob Disease;
- Assessment, Care and Support Planning/Support Planning, Review or advocacy.
The Local Authority Charging Policy sets out how it exercises its power to charge for all other services. It is important that you understand this policy, as this will explain the circumstances when charges will not be made, or when decisions may be made to waiver a charge.
For further information about charging, see: Power of the Local Authority to Charge.
A top-up charge is the difference between the cost of a care home or nursing placement and the personal budget amount.
Top-up charges only apply when there is already a suitable care home or nursing placement available within the personal budget amount, but the person (or their legal representative if they lack capacity) chooses a more expensive placement.
The only circumstance when a top up charge would not apply is if there is no suitable placement available within the personal budget amount. In this case, the Local Authority is required to increase the personal budget amount to the level needed to meet the cost of an available suitable placement.
In most cases the top-up charge cannot be paid by the individual and is payable by a third party (usually a family member). This is because the individual will already be making the maximum financial contribution payable under the Regulations.
For further guidance on top-ups, see: Choice of Accommodation and Topping Up.
There are 3 possible outcomes of a financial assessment:
- The Local Authority will provide no financial support. In this case the individual is self-funding, meaning they must meet the full cost of Care and Support services;
- The Local Authority will provide some financial support, but not enough to cover the full cost. In this case the individual will be required to contribute the difference; or
- The Local Authority will provide full financial support. In this case the individual will not have to make any contribution.
Where a person with Care and Support needs has been assessed as liable to meet the full cost of their services, they may be eligible for a Deferred Payment agreement, and this should always be considered by the team responsible for financial assessment.
See: Deferred Payment Agreements and Alternative Financial Arrangements.
Information and advice about the financial assessment process should be provided at the earliest opportunity. This is integral to an individual's consideration of how best to meet both immediate and future needs and people who have received good information and advice have a much better understanding of how their available resources can be used more flexibly to fund a wider range of care options.
Providing information and advice at an early stage also reduces the likelihood of disputes around financial contributions occurring.
The Care Act sets out the specific information and advice that must be provided about financial assessment. See: Specific Requirements on Provision of the Information and Advice around Finances.
General information and advice about the financial assessment process should be provided whenever an individual requests it, or whenever you feel it would be beneficial.
When providing this information and advice, you should seek the support of your line manager or the team responsible for financial assessment as required.
See the Financial Assessment and Charging FAQ Response Support Tool for the answers to some frequently asked questions around financial assessment, including questions relating to Disabled Facilities Grants.
Although you should be able to provide general information and advice about the financial assessment process, you should not provide, nor attempt to provide financial advice relating to the specific financial circumstances of an individual.
Where such information or advice is required, you should instead support the person to access it, either from the team responsible for financial assessment (or another Local Authority team in a position to provide it), or from an independent financial advisor.
When signposting someone to an independent financial advisor, you should explain that the advisor may charge for the advice. You should also provide information about how the individual can source other independent financial advisors.
The following are some not-for-profit organisations that can either provide independent advice, or support individuals to find it:
When providing information and advice to a person with Care and Support needs (or a carer with Support needs), it must be given in a way that it can be understood and used. This is a legal requirement of the Care Act.
See How to Provide Information and Advice.
If you feel that a person or carer will need support to understand the information and advice provided to them, you should consider:
- Whether the information can be provided in a different way;
- Whether you can take any additional steps to support them to understand it (for example talking through the information on the telephone or in person);
- Whether it would be appropriate to appoint an independent advocate to support them to understand and use the information.
For the sole purpose of understanding information and advice there is no duty under the Care Act to provide an independent advocate. This is a local decision that should be made by taking into account the available evidence and presenting circumstances.
If an early financial assessment has not already been completed (see below), a financial assessment must be requested when all the following applies:
- The individual has eligible needs (or urgent needs that the Local Authority intends to meet); and
- The individual is ordinarily resident in the Local Authority area (or present with no settled residence); and
- The services to be provided are chargeable; and
- The Local Authority Charging Policy is to charge for that service.
A financial assessment should only be carried out for the individual who is receiving the chargeable service. This means that where a carer is being supported through the provision of a service to the person, for example respite, it is the person that should be financially assessed, not the carer.
Under the Care Act it is possible to complete a financial assessment before the points above have been established, if all the following apply:
- The individual to be financially assessed has requested an early assessment (or it has been requested by somebody legally authorised to make the request); and
- Completing the financial assessment will not have a negative impact on individual wellbeing (for example, causing anxiety); and
- They are likely to have eligible needs; and
- It is likely that a chargeable service will be provided (if a non-chargeable service is likely then a financial assessment is not required); and
- Financial resources are not likely to change by the time that the service is provided.
Early financial assessments should not be carried out:
- To ease the administrative burden of the Local Authority; or
- If the outcome is to be used to restrict access to a service; or
- If the service to be received is non-chargeable under the Care Act; or
- If the Local Authority does not intend to make a charge.
During statutory reviews (and any other Care and Support process) you should consider whether there have been any changes in the individual’s financial circumstances that may have an impact on their ability to make a financial contribution.
If there have been any changes, you should notify the team responsible for financial assessment who will be able to review the current contribution.
It is unlawful for the Local Authority to charge an individual more than they can afford to pay, but it is also unlawful for an individual not to contribute to the cost of chargeable services if they can afford to do so.
You should follow available local processes to request a financial assessment/reassessment.
Following a financial assessment any financial contribution payable should be recorded on the Care and Support Plan (or, if applicable, the carer’s Support Plan).
Where there is no financial contribution payable, this should be recorded as zero.
Where there is a requirement to record a financial contribution start date, this should correspond with the start date for the associated Care and Support services unless a decision has been made otherwise through the financial assessment process.
Delays in financial assessment must not cause delays in the meeting of eligible needs (or urgent needs that the Local Authority has agreed to meet).
If a financial assessment cannot be carried out in a timely way you should proceed to arrange for the agreed services and support to be provided as required.
The following should be explained to the individual awaiting the financial assessment:
- The reasons for the delay;
- That a financial assessment will still be taking place;
- That any financial contributions will be payable from the date that services start.
If an individual is making a financial contribution, you must notify the team responsible for charging if you are aware that a service has not been provided or received (either one-off or over a period of time).
The team responsible for charging will determine whether there needs to be any adjustment or reimbursement of monies paid.
Not receiving a service may have no impact on the amount of a financial contribution if the total cost of the services they have received in that accounting period is greater than the financial contribution they have been assessed to make.
If chargeable services change, but there is no impact on the personal budget, no action is required.
If chargeable services change and there is an impact on the personal budget amount, the team responsible for financial assessment should be notified at the earliest opportunity. They will consider any need to reassess finances and/or revise the financial contribution.
If there is subsequently a change to the contribution amount, the Care and Support Plan (or, if applicable, the carer’s Support Plan) should be updated.
If chargeable services end altogether, both the team responsible for financial assessment and the team responsible for charging should be notified at the earliest opportunity. This will ensure that financial contributions can be adjusted, and the individual is not going to be charged for services they are no longer receiving.
Where chargeable services end, any ongoing Care and Support Plan (or, if applicable, carer’s Support Plan) should be adjusted to reflect the change.
Sometimes an individual (or their legal representative if they lack capacity) will refuse to engage in or co-operate with the financial assessment process.
Where this happens, you should still proceed to arrange for the agreed services and support to be provided as required. The Local Authority has a legal duty to meet eligible needs (or urgent needs that it has agreed to meet) and must not delay or decline to do this on the basis that an individual has declined to engage in a financial assessment.
When a financial assessment cannot be completed at all, or cannot be completed adequately, the Local Authority is permitted under the Care Act to conclude that the individual has sufficient financial resources to pay for the full cost of the services provided to them.
Sometimes an individual will intentionally deprive themselves of an asset they have or an income they receive in order to minimise the financial contribution they make to their Care and Support services.
This practice is not lawful, and the Local Authority can take legal action to seek reimbursement
Examples of possible deprivations include, but are not limited to:
- Making a significant purchase that is out of character;
- Transferring large amounts of money to another person;
- Transferring the deeds of a property to a family member.
For further information see: Deprivation of Assets and Enforcement of Debts.
If you know or suspect that a deprivation of assets is going to or has already occurred you must notify the team responsible for financial assessment, whose responsibility it is to make enquiries to establish whether this is the case and, if so, determine what legal action to take.
Note: Whether or not an individual is suspected of or found to have deprived themselves of an asset or income to avoid Care and Support charges this should not affect the provision of the Care and Support service they receive from the Local Authority.
Declining to make contributions has no impact on the provision of support and services. The Local Authority has a legal duty to meet eligible needs and must not delay or decline to do this on the basis that the individual has declined to make financial contributions.
If an individual declines to make financial contributions following a financial assessment, the team responsible for charging should liaise with them (or their legal representative if they lack capacity) to establish why contributions have not been paid.
If an individual persists in declining to make contributions, the Local Authority can arrange to seek reimbursement of any monies owed to them (through the Courts if necessary).
The Local Authority Charging Policy should set out the circumstances when decisions to waiver a charge may be considered.
Any view you have about the need to waiver a charge should be based upon information and evidence not already considered as part of the financial assessment process. For example, if a person with Care and Support needs has Disability Related Expenses that they did not declare during the financial assessment.
In the first instance, the new evidence should be shared with the team responsible for financial assessment who will decide whether the original assessment should be reviewed or not. If they decide that the original assessment stands (either straight away or following review), you should only take further action if you believe the new evidence provided has not been considered. If this is the case, you should discuss and agree with your line manager whether to submit a waiver request.
Any waiver requests should be submitted in line with local processes and requirements.
Last Updated: January 2, 2024
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