ASK OUR ADVISERS - What is tariff income?

Tariff income is the contribution an individual is required to make towards the cost of their care when they have savings between the upper support threshold of £23,250 and the lower threshold of £14,250.

The income is calculated at £1 per week for every £250 or part thereof of savings between the two thresholds.

So a person who has seen their savings reduce to £23,250 may become eligible for funding support from the local authority, but they will need to pay tariff income as follows.

Amount of capital above the lower support threshold = £9,000

This equates to 36 slices of £250, so 36 x £1 = £36 per week.

Alternatively, if they had savings of £18,450 the tariff income would be:

Amount of capital above the lower support threshold = £4,200

This equates to 17 slices or part slices of £250, so 17 x £1 = £17 per week.

For capital below £14,250, no tariff income is applied.