Guide to Personal Expenses Allowance

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Important takeaways:

There are a number of things to remember with Personal Expenses Allowance: 

• You are entitled to Personal Expenses Allowance if you are a care home resident who receives local authority-arranged care
• It’s a care home personal allowance to spend as you wish
• How much is Personal Expenses Allowance? The amount you receive each week depends on where you live within the UK and rates change each tax year in line with inflation

When someone moves into a care home, a lot of their income may be used to pay towards their care home fees.

But to ensure residents have some money set aside each week to spend on small items, they receive a Personal Expenses Allowance in England, Scotland and Northern Ireland or Minimum Income Amount in Wales.

But what does this care home personal allowance mean for residents? Let’s take a closer look.

What is Personal Expenses Allowance?

If a care home resident receives local authority-arranged care, they will receive a weekly Personal Expenses Allowance or Minimum Income Amount.

Personal Expenses Allowance is an amount of money disregarded from your income when paying care home fees, ensuring care home residents can keep this allowance to pay for small items of their choice.

Each week, the local authority will leave each care home resident with a Personal Expenses Allowance to spend as they wish. Residents might spend their money on: 

• Toiletries
• Birthday gifts
• stationery
• Newspapers & magazines
• Haircuts
• Treats
• Any smaller items they would like

Who is eligible for Personal Expenses Allowance?

To fit the criteria for the care home Personal Expenses Allowance, someone must:

• Live in a care home in England, Scotland or Northern Ireland
• Have their care is funded by the local authority (state-funded)

Similarly, for the Minimum Income Amount, a person must:

• Live in a care home in Wales
• Have their care is funded by the local authority (state-funded)

It’s important to remember that your Personal Expenses Allowance shouldn’t be spent on care, and no local authority or care home has the legal right to ask you to spend any of it on your care. It is mandatory that care home residents are allowed to keep their PEA and spend it how they wish. 

What is Personal Expenses Allowance/Minimum Income Amount taken from?

Your Personal Expenses Allowance or Minimum Income Amount is set aside from your income, which can include your State Pension, private pension and any benefits you receive. 

If you are eligible for state funding for your care home fees, benefits such as your State Pension or private pension will be used to help pay for the cost of care.

However, your PEA or Minimum Income Amount is disregarded from your income when calculating how much you should pay towards your care home fees, leaving a weekly sum aside for you to spend as you please.

Personal Expenses Allowance 2023/24

The Personal Expenses Allowance amount you receive each week will depend on where you live within the UK.

The current rates (per week) for the 2023-24 tax year are:

• England –  £28.25 per week
• Scotland – £32.65 per week
• Northern Ireland – £27.19 per week
• Wales – £39.50 a week (Minimum Income Amount)

These rates change each tax year in line with inflation. 

For example, compared to previous financial year, the weekly Personal Expenses Allowance 2022/23 was:

• £25.65 in England
• £31.00 in Scotland
• £27.19 Northern Ireland
• £33 in Wales for the Minimum Income Amount

If you or your loved one feel they are in need of more money, local authorities have the power to increase a Personal Expenses Allowance under certain circumstances; for example, if a care home resident has a pet or if they are financially supporting their spouse. However, increases are discretionary and based on individual needs.

To apply for an increase, contact your local authority’s social care department.

Please ask your local Authority during the assessment process for further clarification on this amount as this differs between UK regions and is usually increased every April.

Frequently asked questions

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