When Someone Else Signs the Return: The Care Question Reaches You First

There is a moment in a long client relationship that almost every practice has seen and almost no practice has written down. The return comes back approved, but not by the client. A daughter rings to ask what the payment on account is for. A new agent authorisation goes through with somebody else's name on it. The client you have acted for since 1998 is still on the file, but they are no longer the person you are speaking to.

That change of signature is the most reliable later-life signal any professional in the client's life ever receives, and the accountant almost always receives it first. Not the solicitor, who may have drafted the lasting power of attorney years ago and heard nothing since. Not the bank, which sees a registration form rather than a family. The accountant, who has the annual rhythm, the historic file and the conversation that happens every January whether anything has changed or not.

What follows that moment is a set of decisions with more money attached to them than most business sale negotiations, made by a family with no professional standing behind them, in the four to six weeks after a hospital discharge meeting. It is worth understanding what the state actually does and does not pay for before that call comes in.

The means test that has not moved since 2010

The Department of Health and Social Care publishes a circular each February setting the figures local authorities in England use to charge for care. The current one, Social care — charging for care and support 2026 to 2027, reference LAC(DHSC)(2026)2, was published on 17 February 2026. It uprated the personal expenses allowance for care home residents to £31.80 a week, and the minimum income guarantee for a single person of pension credit age to £241.45 a week, both by 3.8% inflation.

It did not move the capital limits. The upper limit stays at £23,250 and the lower limit at £14,250 — the levels set in 2010, now held for a sixteenth consecutive year. Above £23,250, a person meets the full cost of their care. Below £14,250, their capital is left alone and they contribute from income. In between sits a tariff: an assumed income of £1 a week for every £250, or part of £250, above the lower limit. At £23,250 exactly, that is £36 a week of income the person does not actually receive.

Two further rules decide whether this is a large problem or a small one. For a permanent move into residential care, the person's main or only home is disregarded for the first 12 weeks. And it is disregarded indefinitely — not for 12 weeks, indefinitely — where a qualifying relative occupies it as their main home and was doing so before the move: a partner, a relative aged 60 or over, an incapacitated relative, or a child under 18. Whether a 61-year-old son happens to live in his mother's house is, in charging terms, worth more than most tax planning any practice will do that year.

The reform that was going to change all of this is not coming. The 2021 charging reforms, which would have raised the upper limit to £100,000 and introduced an £86,000 lifetime cap on care costs, were cancelled in July 2024. The Casey Commission, established to design a national care service, set out initial recommendations in March 2026, and the government wrote to Baroness Casey on 22 June 2026 with progress against them. Its second phase is not due to report until 2028. Nothing in that timetable helps a family making a decision this autumn.

The arithmetic on one client file

Take a composite client, illustrative rather than real. Margaret is 84, widowed, and has been a personal tax client of the firm since her husband's business was sold. She moves permanently into residential care in the spring. Her house is worth £310,000 and stands empty. She holds £190,000 in deposits and investment bonds. Her income is the full new State Pension, £241.30 a week for 2026 to 2027, plus a private pension of £180 a week — £421.30 in total. The care home charges £1,250 a week.

Because she is meeting the full cost herself, she keeps Attendance Allowance at the higher rate, £114.60 a week for 2026 to 2027. So the weekly gap is £1,250 less £421.30 of pension and £114.60 of Attendance Allowance: £714.10 a week, or £37,133 a year.

Her liquid capital of £190,000 covers that for a little over five years, before any annual fee increase. But after the 12-week disregard ends, the empty house counts too, so her assessed capital is £500,000. Reaching the £23,250 threshold at which the local authority starts to contribute means spending £476,750 — just under thirteen years at the current gap. In practice the family will never get there. The estate will be substantially consumed, the house will be sold or placed under a deferred payment agreement, and the local authority will not appear at any point.

The family are not making a bad decision. They are making a decision with a thirteen-year time horizon in the four weeks after a hospital discharge, using the only professional relationship they have, which is with you.

Now change one fact. Suppose Margaret's son, aged 62, had been living in that house as his main home before she moved. The property is disregarded entirely. Her assessed capital is £190,000, she reaches the upper limit in about four and a half years, and the local authority picks up a substantial share of a bill that would otherwise have taken the house. Same client, same fees, entirely different outcome — turning on a fact that sits in the accountant's own knowledge of the family rather than in any financial statement.

One more detail worth knowing before it happens. Once the local authority does start paying, in full or in part, Attendance Allowance stops 28 days later. In Margaret's case that removes £5,959 a year of tax-free income in the same month the family assume the pressure has eased.

What you can see that nobody else can

This is the same pattern we described in the six signals already sitting in your client file, and it has the same shape: the information is not hidden, it is unread. Three things sit in an accountancy practice and effectively nowhere else.

The first is the change of signatory itself. A registered lasting power of attorney is a legal document filed with the Office of the Public Guardian; the moment it starts being used is not filed anywhere. Your engagement records show it, because somebody new began approving the return.

The second is the shape of the income. You see the deposit interest fall because a large sum was withdrawn. You see rental income stop because the property was let and now is not. You see a chargeable event certificate arrive because a bond was surrendered in a hurry. Each of those is a family paying for care out of whatever was easiest to reach, which is rarely the asset it would have been sensible to use first.

The third is the whole picture. The attorney sees a bank balance. The care home sees an invoice. You see the property, the investments, the pension income, the other children, the earlier gifts, and the will you were told about when the trust was set up — the same joined-up view we described in the trust register signal.

Where your role stops, precisely

None of the above is regulated activity, and none of it needs to become one. Preparing the return for an attorney to approve, explaining the tax consequences of a bond surrender and telling a family what the capital limits are is the work you already do. The boundary is the next step: telling them what to do with the capital.

One question in particular should never be answered across the desk, and it is the one families ask most: should we put the house in the children's names? Annex E of the Care and Support Statutory Guidance defines deprivation of assets as intentionally depriving or decreasing overall assets in order to reduce the amount charged for care, which requires that the person knew they needed care and support. Local authority practice guidance issued under section 70 of the Care Act 2014 is explicit that there is no time limit on how far back an authority may look, and that there is no seven-year rule — people import that number from inheritance tax, where it belongs, and apply it to care charging, where it does not. An authority can assess the person as still notionally holding the asset, and can pursue the transferee for the charge.

The attorney has an exposure of their own here. Acting under a lasting power of attorney means acting in the donor's best interests, and where large sums are held the Office of the Public Guardian's standards for deputies point towards taking independent financial advice rather than making investment decisions personally. A son who leaves £400,000 sitting in a current account for four years, or who moves it into something he read about, is making a decision he is not qualified to make and can be asked to account for.

What the regulated half of the conversation covers

The planner's side of this is narrow, technical and genuinely different from tax work. It covers how to structure capital that has to fund an open-ended and rising liability while remaining accessible. It covers whether the existing portfolio still matches a horizon that has changed completely. It covers the interaction between care fees and the estate — the point at which this meets the inheritance tax change we covered in when the pension joins the estate.

It also covers a product family that exists solely for this situation and that most people have never heard of. An immediate needs annuity converts a lump sum into an income for life towards care fees. Section 725 of the Income Tax (Trading and Other Income) Act 2005 provides that payments under a qualifying immediate needs annuity are free of income tax where they are made directly to a care provider for the benefit of the person protected. Whether one is appropriate for a given client depends on their health, the fee level, the capital available and what the family want to protect — which is precisely why it is an assessment for an authorised adviser and not a suggestion from a year-end meeting.

Three things to do this week

First, run one query against your practice management system: which personal tax returns in the last two years were approved by somebody other than the client. Most firms have never asked. The list is usually short, entirely accurate, and nobody has ever looked at it as a list.

Second, add a single question to the year-end routine for clients over 75: is there a registered lasting power of attorney, and who holds it. It takes ten seconds, it is squarely within your existing relationship, and the answer changes what you do when the call eventually comes.

Third, agree the handover wording before you need it. Something close to: this is outside what we are permitted to advise on, but we work with a regulated firm who deal with exactly this, and I can introduce you. The form of that introduction, and what happens after it, is set out in who does what.

What is not yet settled

Two honest caveats. The figures above are England only. Scotland, Wales and Northern Ireland run different charging regimes with different thresholds, and a client with a property in one nation and a care placement in another needs the position checked in both. And the Casey Commission's second phase, reporting in 2028, may change the charging architecture; its first-phase recommendations, issued in March 2026, concentrated on delivery rather than on who pays. Until legislation follows, £23,250 is the number, and it has been the number since 2010.

The wider point about who opens these conversations

The lang cat's State of Advice Report 2025 found that just 9% of UK adults had paid for financial advice in the preceding two years, while 91% of those who did take advice found it valuable. It put the average age of an IFA client at 59, the average new client portfolio at £411,000, and the number of IFA firms in the UK below 5,000. Read together, those numbers describe a profession that serves a narrow group extremely well and never meets almost anybody else — and an average client age of 59 means the advice relationship, where it exists at all, is usually formed decades before the care question arrives.

Margaret's family will get advice from somebody. It will be the care home's finance office, a comparison site, an adult child's colleague at work, or nobody. The one professional they already trust, who has the full picture and sees the signature change before anyone else, is under no obligation to open the conversation. Whether they do is a decision each firm makes for itself, and we set out the wider case for it on the advice gap.

Common questions