Search for "asset protection trust" and you will find no shortage of companies promising that putting your house into a trust will stop the council ever touching it for care fees. We want to be straightforward with you: some of those claims go further than the law actually allows. What we can tell you is what a properly structured trust genuinely does achieve, because it is still a valuable and widely used piece of estate planning, just not for the reason some sellers imply.

What a property protection trust actually is

The structure most people mean when they say "asset protection trust" is more accurately called a Property Protection Trust, or Life Interest Trust. It is created through your will, not during your lifetime, and it takes effect when the first partner in a couple dies. Instead of the family home passing outright to the surviving partner, that partner's own share is protected separately, while the deceased's share goes into trust, with the survivor given the right to live in the property for the rest of their life. When the surviving partner later dies, the trust share passes to whoever was originally named, typically the children, rather than being subject to a later decision by the surviving partner alone.

What it genuinely protects against

A correctly structured trust of this kind achieves several real things:

• It protects a share of the home for your children, even if your surviving partner later remarries, or their own will changes after you are gone.

• It can reduce Inheritance Tax exposure in some circumstances, depending on how your estate is structured.

• It can mean the deceased partner's share is not counted in the surviving partner's own means test, if that partner later needs residential care themselves, because they only ever held a life interest in that share, not outright ownership of it.

That last point is the genuine, legitimate version of the "protects your home from care fees" claim, and it only works for the surviving partner, in relation to the share that was never theirs outright to begin with.

What it cannot do

This is the part that matters most, and where some marketing in this sector overstates things.

It cannot protect your own assets from your own current or foreseeable care costs. If you are the one who may need care, you cannot put your home into a trust at that point and expect it to be ignored by the means test. Local authorities apply what is called the deliberate deprivation of assets rule under the Care Act 2014. If avoiding care fees was a significant motivation behind a transfer, the council can treat you as though you still own the asset, known as notional capital, even though you no longer have it. There is no statutory time limit on how far back a council can look, and no "seven year rule" that protects older transfers, that figure comes from inheritance tax law and has nothing to do with care funding.

Timing and purpose matter enormously. A trust created through a will, years before either partner needed care, for genuine reasons such as protecting children from a first marriage, sits on entirely safe legal ground. A trust set up specifically because care looks likely in the near future, with the primary purpose of avoiding the bill, does not, regardless of how it is structured or marketed.

The current rules, in plain terms

In England in 2026/27, if your assessable capital is above £23,250, you are expected to pay for your own care in full. Below £14,250, the local authority funds your care, with you contributing only from income. Between those two figures, you make a sliding-scale contribution. Your home is usually disregarded entirely from this calculation while a spouse, partner, or certain qualifying relatives continue to live there.

The honest takeaway

Be cautious of anyone selling a trust as a guaranteed way to keep your own home safe from your own future care costs. Used properly, and put in place well ahead of any care need, for the right family reasons, a property protection trust is a genuinely valuable part of estate planning, protecting your children's inheritance and potentially helping your surviving partner later on. Used as a last-minute attempt to dodge a bill that already looks likely, it is unlikely to work, and could leave your family worse off than doing nothing at all.

Want to know what actually applies to your situation? Book Consultation with Everlasting Legacy for an honest assessment, not a sales pitch.

This article provides general information about the law in England & Wales and is correct at the time of writing. It does not constitute legal, financial, or social care advice and should not be relied upon without independent professional advice tailored to your individual circumstances.