What are the lifetime and annual caps on means-tested care fees?
Caps depend on which fee arrangements apply. Older residential arrangements have annual and lifetime caps on the Means-Tested Care Fee. Newer arrangements have separate caps and time limits for non-clinical care contributions, and Support at Home has its own indexed lifetime contribution cap.
Key points
- Caps differ between home care and residential arrangements.
- Entry date and protected status matter.
- Use current Services Australia figures rather than an old article.
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01Guide sectionWhat are the annual and lifetime caps on means-tested aged care fees?
Caps limit how much a person can be required to contribute towards certain means-tested aged care costs.
The rules differ between:
people covered by the former Home Care Package and residential aged care fee arrangements
people who entered the newer Support at Home or residential aged care system from 1 November 2025.
02Guide sectionFormer Home Care Package and residential care arrangements
For people covered by the fee arrangements that applied from 1 July 2014 to 31 October 2025, the current caps on the Income-Tested Care Fee and Means-Tested Care Fee are:
Annual cap: $35,910.43
Lifetime cap: $86,185.23
These amounts are current as at July 2026 and are indexed periodically.
03Guide sectionHow does the annual cap work?
The annual cap limits the amount of Income-Tested Care Fees and Means-Tested Care Fees a person can pay during a care year.
The care year usually runs from the anniversary of the date the person first began receiving relevant aged care-not necessarily from 1 January to 31 December.
Once the annual cap is reached:
the person stops paying the Means-Tested Care Fee for the remainder of that care year
the government pays the eligible care cost instead
the fee may recommence when the next care year begins, unless the lifetime cap has also been reached.
Services Australia tracks the amount paid and advises the participant and provider when the cap is reached.
04Guide sectionHow does the lifetime cap work?
The lifetime cap is the maximum total amount a person can pay in applicable means-tested care fees over their lifetime.
Once the lifetime cap of $86,185.23 is reached, the person no longer pays:
the former Home Care Package Income-Tested Care Fee
the residential aged care Means-Tested Care Fee under the older arrangements.
The government then pays the eligible care costs that would otherwise have been covered by those fees.
05Guide sectionDo home care fees count towards the residential care caps?
Yes.
Income-Tested Care Fees previously paid under a Home Care Package generally count towards both the annual and lifetime caps if the person later enters residential aged care under the applicable older fee arrangements.
For example, if someone previously paid $20,000 in Income-Tested Care Fees through a Home Care Package, that amount counts towards their lifetime cap.
They would have approximately $66,185.23 remaining before reaching the current lifetime limit, subject to indexation and Services Australia’s official records.
The annual cap may also include relevant fees paid across both home care and residential care during the same care year.
06Guide sectionDo the Basic Daily Fee and accommodation costs count?
No. The caps do not normally include:
the residential Basic Daily Fee
a Refundable Accommodation Deposit or Contribution
Daily Accommodation Payments or Contributions
optional higher everyday living fees
ordinary Support at Home service prices
privately purchased services.
The caps apply specifically to the relevant means-tested care fees or contributions.
07Guide sectionWhat applies under Support at Home?
New Support at Home participants approved after 12 September 2024 are generally covered by a broader lifetime contribution cap rather than the former annual Income-Tested Care Fee cap.
The Support at Home lifetime cap applies across contributions for:
independence services
everyday living services
eligible non-clinical residential care if the person later enters an aged care home.
There is no participant contribution for approved clinical supports such as nursing and physiotherapy, so those services do not contribute towards the cap.
People protected by the no worse off principle generally retain the former Home Care Package lifetime cap of $86,185.23.
08Guide sectionWhat applies to people entering residential aged care from 1 November 2025?
New residents do not generally pay a fee called the Means-Tested Care Fee.
They may instead pay:
a means-tested hotelling contribution
a non-clinical care contribution.
The non-clinical care contribution has:
a daily maximum
a lifetime dollar cap
a maximum payment period of four cumulative years.
The current lifetime cap is approximately $137,917.01. The contribution stops when the person reaches that dollar limit or has paid it for four cumulative years, whichever occurs first.
There is no equivalent annual cap under these newer residential arrangements.
09Guide sectionPractical example
Suppose a resident under the older arrangements is assessed to pay a Means-Tested Care Fee of $120 per day.
At that rate, they would reach the current annual cap of $35,910.43 before the end of the care year.
After reaching the cap:
they stop paying the Means-Tested Care Fee for the remainder of that care year
they continue paying other applicable costs, such as the Basic Daily Fee and accommodation payments
the Means-Tested Care Fee may restart in the next care year if the lifetime cap has not been reached.
10Guide sectionHow can I check how much I have already paid?
Services Australia or the Department of Veterans’ Affairs keeps the official record.
Ask for confirmation of:
the fees counted towards your current annual cap
your care-year anniversary date
the amount counted towards your lifetime cap
any previous Home Care Package fees included
the remaining amount before the cap is reached.
The practical summary is:
Under the older arrangements, the current Means-Tested Care Fee caps are $35,910.43 a year and $86,185.23 over a lifetime. Newer aged care arrangements use a different lifetime contribution cap, and generally do not have the same annual cap.
11Guide sectionWhat should I do next?
Use the current Services Australia fee advice for the individual and confirm which amounts already paid count toward their cap before making financial decisions.
12Guide sectionHelpful Local Home Help resources
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