Care Homes: Older People

(asked on 12th October 2021) - View Source

Question to the HM Treasury:

To ask Her Majesty's Government whether they will introduce savings incentives to help people pay for elderly care.


Answered by
 Portrait
Lord Agnew of Oulton
This question was answered on 26th October 2021

The government is committed to both supporting individuals at all stages of life to save and delivering world-leading health and social care across the whole of the UK.

The government already provides extensive support to individuals to save for retirement and later life. Individuals are currently able to save up to £20,000 each year across the four types of Individual Savings Accounts (ISAs), which offer a range of mechanisms to save or invest tax-free. This includes the Lifetime ISA which allows savers to benefit from a 25% government bonus on up to £4,000 of savings each year and supports saving towards later life. These savings, including the government bonus, can be withdrawn from the age of 60 and may be used to pay for care.

And more broadly, for the majority of savers, pension contributions made from income during working life is tax-free. Investment growth of assets in a pension scheme is also not subject to tax and, from age 55 (or when scheme rules allow a pension to be taken), up to 25 per cent of the pension can be taken tax-free, depending on scheme rules.

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