The Fair Deal Scheme in Ireland: How It Works, What It Costs and How to Apply
The Fair Deal Scheme, properly called the Nursing Homes Support Scheme, is how most people in Ireland pay for long term nursing home care. You pay a contribution based on your income and assets, and the HSE pays the rest. Your contribution is the same whichever approved nursing home you choose, public, private or voluntary.
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This page covers who qualifies, how the contribution is worked out, what happens to the family home, the Nursing Home Loan, and how to apply.
It is written for someone who has just been told a parent needs long term care and has no idea where to start. If that is where you are, the short answer is that you will not lose the family home, the application is free, and you have more time than you think, though less than you would like.
Who qualifies
Two conditions. You must be ordinarily resident in Ireland, and you must be assessed as needing long term nursing home care.
There is no means test for eligibility itself. The financial assessment decides what you pay, not whether you are in.
You need to be approved before funding starts, and funding is not backdated.
What the scheme covers
Covered
- Accommodation and food
- Nursing and personal care
- Laundry
- Basic aids and appliances for everyday living
Not covered
- Short term care: respite, convalescent or day care
- Extra charges made by the nursing home, such as hairdressing, therapies, activities and social programmes
Those extras are not small. Many homes charge a weekly activities or entertainment fee on top of the agreed rate, and it can add up to a significant amount over a year. Ask any home you are considering for a full written list of charges that fall outside the scheme, and ask before admission, not after.
The two assessments
Once the application form is in, there are two assessments.
The Care Needs Assessment
The Care Needs Assessment decides whether long term nursing home care is the right option, or whether you could be supported at home. It is carried out by a healthcare professional appointed by the HSE, usually in your home or in hospital, and it looks at how you manage daily activities, what support you already have, and what you want.
The Financial Assessment
The Financial Assessment works out what you pay. It looks at all of your income and all of your assets. If the care needs assessment finds you do not need nursing home care, you have to wait six months to apply again, unless your health changes in the meantime.
Worth knowing
Worth knowing: a nursing home is not the only option, and for a lot of families it is not the best one. If staying at home with the right support would work, that is often both the preferred choice and the cheaper one.
How your contribution is calculated
Two parts, added together.
Income: you pay 80% of your assessable income. That includes pensions, social welfare payments, earnings, rental income from property that is not your own home, and income from dividends or interest.
Assets: you pay 7.5% of the value of your assets per year. The first €36,000 is not counted. Assets include savings, shares, your home, other property, land and businesses.
If you are part of a couple, the assessment is based on half of your combined income and assets, so the rates effectively halve to 40% of income and 3.75% of assets, and the disregard doubles to €72,000.
A worked example
A single applicant with a pension of €400 a week, €50,000 in savings and a home valued at €250,000.
Income: 80% of €400 = €320 a week.
Assets: €50,000 in savings plus a €250,000 home is €300,000. Take off the €36,000 disregard and €264,000 is assessable. 7.5% of that is €19,800 a year, or €380.77 a week.
Total contribution: €700.77 a week.
After three years the home drops out of the calculation entirely. The contribution falls to €320 from income plus €20.19 from the remaining savings, so €340.19 a week. Over those three years the home has contributed €56,250, which is 22.5% of its value, and nothing further is ever charged against it.
See more worked examples, including a couple, a farm and a case where the Fair Deal Scheme was not the right answer.
The three year cap and the family home
This is the part families worry about most, and the worry is usually worse than the reality.
Your home is included in the assessment, but only for three years. You pay 7.5% of its value per year for a maximum of three years, so 22.5% in total, and then it stops, however long you stay in care. You do not have to sell it.
If you are part of a couple and your partner is still living there, the cap is 11.25% rather than 22.5%.
If you sell the home while in care, the net proceeds still qualify for the three year cap. Tell your local Nursing Homes Support Office if you do.
Farms and family businesses
Family owned farms and relevant businesses can also come under the three year cap, which makes a substantial difference, but only if certain conditions are met:
- You must apply to the HSE to appoint a family successor, who commits to running the farm or business for at least six years
- The farm or business must have been actively run by you, your partner or the proposed successor for at least three of the last five years
- A charge in favour of the HSE is registered against the chargeable property
The successor must be 18 or over and a relative of yours or your partner’s. That list was widened in September 2024 and now includes more distant relatives than it used to.
Without the cap, a farm is assessed at 7.5% a year for as long as the person is in care, with no end point. The difference between getting this right and getting it wrong runs into six figures on a farm of any size, and it is the single most common reason farming families come to us.
The safeguards
Three protections worth knowing about:
You never pay more than the actual cost of your care.
You keep at least 20% of your income, or 20% of the maximum State Pension (Non Contributory), whichever is greater.
If your spouse or partner stays at home, they keep 60% of the couple’s combined income.
Renting out your home while in care
This changed on 1 February 2024 and a lot of published information has not caught up.
If you own your home and rent it out while you are in a nursing home, you can now apply to keep 100% of that rental income rather than paying 80% of it towards your care. You need to apply, and you need the tenancy registered with the RTB, a rental agreement showing the rent, and your latest Revenue notice of assessment.
This applies to your principal private residence only. Rent from any other property is still assessed at 80%.
The Nursing Home Loan
Also called Ancillary State Support. It is optional, and it is for people who have assets but not the cash flow to pay the asset contribution as they go.
Instead of paying the 7.5% on land or property now, the HSE pays it for you and it is recovered later. A charging order is registered against the property, which is essentially a mortgage securing the loan.
Repayment goes to the Revenue Commissioners:
- Within 12 months of the person’s death
- Within 6 months if the property is sold or transferred while they are still in care
- Interest is charged only if those deadlines are missed
- The amount is adjusted for inflation using the Consumer Price Index
If a spouse, partner or former carer is still living in the home, repayment can be deferred for longer.
If the person applying does not have capacity to consent to the charging order, only a registered Enduring Power of Attorney, a decision making representative appointed by the Circuit Court, or a Ward of Court committee can do it for them.
The Application Process
The stages in the process
Complete the Nursing Home Support Scheme application form.
Gather the supporting documents listed on the form. This is the slow part.
Send both to your Local Nursing Homes Support Office.
A nurse or a geatrician employed by the HSE will carry out the care needs assessment.
The HSE will carry out the Financial Assessment. This determines what your contribution will be.
Apply for the Nursing Home Loan if you want it. Part 5 of the form. You can also do this later while in care.
There is no charge to apply. Once a complete application is with the Fair Deal office it takes around 10/12 weeks to process, though gathering the documents usually takes considerably longer than that.
You can apply up to six months before the place is needed. There is no cost to applying early and there is a real cost to applying late.
Applying on behalf of someone else
The form should be signed by the person going into care. If they cannot sign it, a specified person can apply for them. In order of priority:
Assets transferred inside the five year window and not declared
Assets transferred inside the five year window and not declared
Assets transferred inside the five year window and not declared
Assets transferred inside the five year window and not declared
This is the single most common reason applications stall.
If there is no Enduring Power of Attorney and capacity has already gone, the court route takes months, and that is months during which somebody is paying the full private rate. If a parent still has capacity and you have not sorted an EPA, do it now rather than when you need it.
Appeals and reviews
If you disagree with either assessment, the letter from the HSE sets out the appeals process and your local Appeals Office.
A care needs assessment can be reviewed after six months, or sooner if health changes materially. A financial assessment can be reviewed 12 months after the last one, and the HSE can review at any time.
We can do this on your behalf.
What happens after someone dies
At least three months before distributing the estate, the HSE must be sent a Schedule of Assets and written notice of the intention to distribute. If that is not done, whoever is handling the estate can be held personally liable for any overpayment.
Any Nursing Home Loan is repaid to Revenue within 12 months of death.
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