In a bid to try and fix what has recently been described as a ‘broken social care system’ following the global pandemic, UK Prime Minister Boris Johnson has vowed to end catastrophic costs for social care users in England, ahead of setting out his long-awaited reform proposals.
As part of this plan, National Insurance is set to rise by 1.25% from April 2022, and dividend tax will also increase by the same amount at the same time. Since the arrival of Covid-19, the NHS has had to tackle many major pressures that can no longer recover alone. Mr Johnson claims the additional revenue from these tax increases will pay for the biggest catch-up programme in the history of the NHS in England, with £12 billion a year over three years to help deal with the backlog of cases built up during the past 18 months.
Currently, one-in-seven people pay over £100,000 for their social care, but as of October 2023, there will be a cap of £86,000 on lifetime contributions, regardless of assets. And from this time onwards, no one with assets below £20,000 will pay anything for care as their costs will be covered entirely by the government.
However there are loop holes and this legislation may not be all as it seems.
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