The double hit
For families with a home and savings above the inheritance tax allowances, care fees and inheritance tax don't cancel each other out. Care fees are paid first, out of the estate, and inheritance tax is then charged on what remains above the allowances.
From April 2027, unused pensions are also due to count towards the estate for inheritance tax, which will bring many more families into the tax.
Planning for one without the other leaves gaps. A specialist can look at care fees and inheritance tax together. Request a call back.
Frequently asked questions
Can you pay care fees and inheritance tax?
Yes. Care fees are paid during life from the estate, and inheritance tax is then charged on what's left above the tax-free allowances when someone dies.
Do pensions count for inheritance tax?
Unused pension funds and death benefits are due to be included in the estate for inheritance tax for deaths from 6 April 2027.
Do care fees reduce inheritance tax?
They reduce the estate, so the tax bill may fall, but only because the money has been spent on care. Planning for both together usually leaves families better off.
Talk to a specialist
Tell us a little about your situation and a specialist will call you back, usually within one working day. No obligation, and we know these conversations can be difficult.