Rental income expected to be exempt from assessment for care contributions

Rental income from a person’s family home would be exempt when calculating contributions for their care under the Fair Deal scheme, under proposals expected to be included in the Government’s major Housing for All plan.

Minister for Housing Darragh O’Brien is understood to be pressing ahead with the plan that could free up thousands of homes for the rental market.

Housing for All is to be published at the end of August.

The Irish Times understands that under Mr O’Brien’s plans an amendment to existing Fair Deal legislation to exempt rental income from the financial assessment for nursing home residents after three years could be put forward as early as the Autumn.

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There is already a three-year cap on how long the income from the sale of a family home is included as part of the financial assessment for people availing of nursing home care under Fair Deal.

Mr O’Brien is proposing that a three-year cap be placed on rental income from the family home being included in the assessment as well, with the person able to keep all of the income after that.

Mr O’Brien on Tuesday said there is potential for up to 9,000 homes to be freed up for the rental market as a result of the proposed Fair Deal reforms.

Currently 80 per cent of the rental income derived from an older person’s home must pay towards their nursing home fees. Mr O’Brien said the Government is working hard to “remove these barriers” to provide families with “options” to rent out the vacant properties.

The Minister said research conducted by his department found that about 9,000 property owners have sought exemptions from paying local property tax as they are no longer living at home for medical reasons. He said if even a third of these empty properties could be made available to the rental market that would make a “big difference”.

He said there are mature communities where many of these properties are “clustered”.

“It is generally urban but not exclusively,” he added.

Concerns

When the rent exemption plan was first mooted there were reports that Minister of State for Older People Mary Butler had concerns about premature entry of older people into nursing homes to access the rental income and that safeguarding arrangements may be needed.

A source said such concerns are being "taken into account" as talks continue between the Department of Housing and Department of Health on the proposal.

It had been expected that Housing for All would be published this week but its release has been postponed to the end of August amid continuing talks on policies to be included in the plan as well as the fine detail for spending billions of euro within it.