What Were the New Rules For Care Payments?

In 2021, the government announced changes to the social care system in England, including a new £86,000 care cap. This was the maximum amount anyone would need to spend on their own personal care over their lifetime. They also announced increases to the care thresholds. These changes to care payments were due to be introduced in October 2023, but were then pushed back to October 2025, before being scrapped by the new Labour government.

In this article, we’ve explained what these new rules would have meant, how the care fees cap would have worked and when the regulations were due to come into effect.

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In this article:

1. What were the new rules for care payments?
2. What was the care fees cap?
3. When were these new rules due to come into effect?
4. Would the social care cap have affected you?

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What Were the New Rules For Care Payments?

In 2021, the government set out their new rules for care payments in their ‘Build Back Better: Our Plan For Health and Social Care’ publication.

The first part of these new rules was increasing the upper and lower thresholds for local authority-funded care in England. The lower threshold was due increase from £14,250 to £20,000, while the upper threshold would have increased from £23,250 to £100,000.

However, these incoming rules have now been scrapped by the new Labour government.

This would have applied to people living in care homes and those receiving home care.

Here's how the rules would have worked from October 2025, had they been successfully introduced. If your savings and income were:

• Worth more than £100,000 - You’d be classed as a self-funder and would pay for your own care

• Between £20,000 and £100,000 - You'd pay whatever you could afford, along with a means-tested ‘tariff’ contribution from your assets

• Less than £20,000 - Your local authority would fund your care. In this case, you might still need to have made income-based contributions towards the cost of your care.

A financial assessment would determine the total value of your savings and income (and assets if you require care in a care home).

NHS continuing healthcare and NHS-funding nursing care wouldn't have been affected, and you could still have qualified for one of these benefits, depending on your or your loved one’s care needs.

How much can you currently keep before paying for care?

Currently, people in England have to pay for their own care if their savings are greater than £23,250. Assets such as property are also included if care in a care home is needed.

If your savings (and assets if care in a care home is needed) are less than £14,250, your local council will pay for your care. If they're between £14,250 and £23,250, your local council will partially fund your care.

Below, we’ve explained the second part of these rules - the care fees cap. This has also been scrapped by the new Labour government.

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What Was the Care Fees Cap 2025?

There isn’t currently a cap on care fees in the UK. However, the government announced that from October 2025, the most anyone would need to spend on their own personal care across their lifetime was £86,000. Once you reached this £86,000 mark, you’d no longer be required to pay for your care.

The new thresholds meant that if you had savings and income above £100,000, your care would be self-funded until you reached the £86,000 care cap (or the total value of your savings and income dropped below £100,000).

This cap was originally due to come into effect in October 2023, but the government pushed it back to October 2025, before the new Labour government scrapped it altogether.

What did and didn't the care fees cap apply to?

The care cap only applied to money spent on personal care (which encompasses the support provided in residential care homes, nursing homes and any similar required support). This also included personal care at home.

Examples of personal care include help with:

• Getting dressed and undressed
• Getting in and out of bed
• Washing and bathing
• Other personal hygiene tasks
• Medication management
• Applying hygiene-related products

However, the care cap didn't apply to other costs incurred by receiving care, such as accommodation, utility bills, food and cleaning costs.

If your total savings and income exceeded £100,000, once you reached this cap, your local authority would become responsible for meeting your eligible care and support needs. At the same time, you’d continue paying for accommodation and similar costs.

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When Were These New Rules Due To Come Into Effect?

These new rules for care payments, including the care fees cap, were due to come into effect in October 2025. They were originally going to come into effect in October 2023 but were pushed back two years by the government, before being scrapped by the new Labour government.

Chancellor Rachel Reeves has said that cancelling these adult social care reforms would save the UK £1.1 billion by the end of 2025/2026.

How would this cap have worked in Wales?

These new rules wouldn't have applied to people receiving care in Wales.

However, Wales currently has the most generous thresholds for care-seekers in the UK, with an upper threshold of £50,000 for care home fees (this increased from £40,000 in 2019), an upper threshold of £24,000 for home care fees, and no lower threshold.

How would this cap have worked in Scotland?

These new rules wouldn't have applied to people receiving care in Scotland.

However, Scotland’s thresholds for local authority-funded care recently increased to £21,500 at the lower limit and £35,000 at the upper limit.

How would this cap have worked in Northern Ireland?

These new rules wouldn't have applied to people receiving care in Northern Ireland.

The lower threshold will remain £14,250, while the upper threshold will remain £23,250.

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Would the Social Care Cap Have Affected You?

Whether you would have been affected by this social care cap depended on the total value of your savings and income (and assets if you need care in a care home).

The upper threshold increasing from £23,250 to £100,000 would have meant that more people would now qualify for some level of care funding from their local authority.

A financial assessment would determine whether you qualified for local authority funding and how much.

The new £86,000 care cap would have meant that if you paid for your own care, you'd no longer pay indefinitely, but only until you reached this £86,000 mark.

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