The 2026 Care Act Changes: What They Mean for Your Financial Assessment

The Care Act 2014 has long been the cornerstone of adult social care law in England. Recent amendments, which came into force in early 2026, make significant changes to how local authorities are required to conduct financial assessments for those needing residential or domiciliary care. If you or a family member are facing a care fees dispute, understanding these changes is essential.

What has changed?

The most significant change concerns the capital limits used to determine whether a person qualifies for local authority funding. Under the previous regime, anyone with capital above the upper threshold was expected to fund their own care in full. The 2026 amendments have introduced a phased increase to this upper limit, with the intention of reaching the long-promised cap on care costs.

In practical terms, this means that more people will now be eligible for at least a partial contribution from their local authority. However, the way in which these assessments are conducted remains a frequent source of disputes.

Common errors in financial assessments

Local authorities are under significant financial pressure, and errors in financial assessments are more common than many people realise. The most frequent issues we see include:

Incorrect treatment of property. The rules on when the value of a person's home can be included in the financial assessment are detailed and often misapplied. If a spouse, partner, or certain other qualifying individuals still occupy the property, its value must be disregarded entirely. We regularly see councils including property values that should be excluded.

Failure to apply the correct disregards. Certain types of income and capital are required to be disregarded under the Care and Support (Charging and Assessment of Resources) Regulations. Personal injury compensation held in a trust, for example, should not be treated as capital. The list of mandatory disregards is long and frequently overlooked.

Deprivation of assets allegations. This is perhaps the most contentious area. If a local authority believes that a person has deliberately reduced their capital to avoid paying care fees, it can treat them as though they still possess those assets. However, the burden of proof lies with the authority, and they must demonstrate that avoiding care fees was a significant motivation for the disposal, not merely that it had that effect.

How to challenge a financial assessment

If you believe that a financial assessment has been carried out incorrectly, there are several steps you should take. First, request a written copy of the assessment and the calculations used. You are entitled to this under the Care Act. Second, identify the specific errors, whether that is an incorrect capital figure, a failure to apply a disregard, or an unjustified deprivation of assets finding.

Once you have identified the errors, you should write to the local authority setting out your grounds of challenge with reference to the relevant statutory provisions. If the authority does not amend the assessment, you can escalate the matter to the Local Government and Social Care Ombudsman.

The role of legal advice

Care funding disputes are technical, and the consequences of an incorrect assessment can run to tens of thousands of pounds. Getting specialist legal advice early in the process can make a significant difference to the outcome. At Fullbrook Law, we regularly advise clients on challenging financial assessments, deprivation of assets allegations, and disputes about the level of contributions required.

If you are dealing with a care fees dispute, we can help you understand your position and take the right steps to protect your interests.