Many families only discover the nursing home loan when they begin dealing with the estate. It is the optional part of the Fair Deal Scheme that let the deceased delay paying for some of their care, using their assets — usually the family home — as security. This guide explains when the loan falls due, who repays it, and how it clears.
The loan sits within the wider question of how Fair Deal affects an estate. If you are still working out the bigger picture, our guide to Fair Deal and estate recovery explains how the scheme’s charge interacts with what is left to beneficiaries. Here we focus on the practical mechanics of clearing the loan itself.
What the nursing home loan is
The nursing home loan — formally called ancillary state support — is an optional part of the Fair Deal Scheme. It lets a person in care delay paying part of their nursing home costs until after death, using their assets to secure the amount. Most often the asset is the family home. Not everyone in Fair Deal took the loan, so the first step is always to check whether one exists.
Where the loan was taken, it is secured by a Charging Order — a simple type of mortgage registered against the property. The Charging Order is what makes the loan a charge on the estate: the secured property cannot pass cleanly to beneficiaries, or be sold with clear title, until the loan is dealt with.
When the loan falls due
The loan becomes repayable in a small number of situations. The most common is the death of the person in care, but a sale or transfer of the secured property during their lifetime also triggers repayment. The table below sets out the main events and their effect.
The person in care dies
The loan falls due and must be repaid within 12 months of the date of death
The secured property is sold during their lifetime
The loan must be repaid within 6 months of the date of sale
The secured property is transferred or gifted
The loan must be repaid within 6 months of the date of transfer
A qualifying person applies to defer
Repayment of the part secured on the principal residence can be postponed
When the Fair Deal nursing home loan becomes repayable. Source: Revenue and HSE.
| What happens | Effect on the loan |
|---|---|
| The person in care dies | The loan falls due and must be repaid within 12 months of the date of death |
| The secured property is sold during their lifetime | The loan must be repaid within 6 months of the date of sale |
| The secured property is transferred or gifted | The loan must be repaid within 6 months of the date of transfer |
| A qualifying person applies to defer | Repayment of the part secured on the principal residence can be postponed |
On death, the key figure is 12 months from the date of death. That is the window within which the loan must be repaid. It is generous compared with some deadlines in probate, but it can still be tight where the home has to be sold to fund the repayment, since a sale itself depends on first obtaining the grant of probate.
How the loan is repaid after death
The loan is repaid from the estate to the Revenue Commissioners, who collect it on behalf of the HSE. The personal representative — the executor named in a will, or the administrator appointed where there is no will — is the person responsible for clearing it. That responsibility cannot be passed to beneficiaries; it sits with whoever is administering the estate.
Payment can be made online through Revenue’s myAccount or ROS, or by bank draft made payable to the Collector-General and sent to the Collector-General’s Division, with the deceased’s HSE Client ID included so the payment is matched to the right loan. Keep the confirmation of payment with your estate records.
How to repay the nursing home loan: a step-by-step
Five steps take a personal representative from confirming the loan to clearing it within the deadline.
Confirm whether a loan was actually taken out
The nursing home loan is the optional part of Fair Deal — not everyone in care took it. Check the deceased’s Fair Deal paperwork and any correspondence from the HSE or Revenue. If a loan was advanced, it will be secured by a Charging Order — a simple form of mortgage — registered against their principal residence. If no loan was taken, there is nothing to repay under this heading.
Establish the date of death and the 12-month deadline
The loan must be repaid within 12 months of the date of death. That date sets a firm clock. Note it early, because it runs alongside — not instead of — the time it takes to obtain the grant of probate (the court’s permission to manage the estate) and gather in the assets. If the home must be sold to clear the loan, 12 months can be tighter than it first appears.
Get the loan balance from Revenue
Although the HSE administers Fair Deal, the loan is repaid to the Revenue Commissioners, who collect it on the HSE’s behalf. As personal representative, contact Revenue, quoting the deceased’s HSE Client ID, to obtain the exact amount due. The balance reflects the care funded under the loan, adjusted by the Consumer Price Index (a measure of inflation) where applicable.
Hold the estate until the loan is cleared or you have HSE consent
The estate cannot be distributed before the loan is repaid, unless the HSE gives prior written consent. Paying out to beneficiaries early exposes you personally as the person accountable to Revenue. If family members are pressing for an early release, obtain that written consent from the HSE first.
Pay Revenue and obtain confirmation
Payment can be made online through Revenue’s myAccount or ROS, or by bank draft payable to the Collector-General sent to the Collector-General’s Division, with the HSE Client ID included. Pay within the 12 months to avoid interest, keep the receipt, and confirm the loan is discharged before you release the remaining estate or sell the home with clear title.
Interest if you miss the 12-month deadline
If the loan is repaid within 12 months of the date of death, no interest is charged. If it is not, interest applies. The current rate is 0.0219% per day, and it runs from the date of death — not from the end of the 12-month period. Missing the deadline therefore adds interest backdated across the whole period since death.
Repaid within 12 months of death
No interest is charged on the loan
Not repaid within 12 months of death
Interest applies at 0.0219% per day, calculated from the date of death
Interest on the Fair Deal nursing home loan depends on whether you repay within 12 months of death. Source: Revenue.
| Repayment timing | Interest position |
|---|---|
| Repaid within 12 months of death | No interest is charged on the loan |
| Not repaid within 12 months of death | Interest applies at 0.0219% per day, calculated from the date of death |
Because the interest is backdated to the date of death, there is a real cost to drifting past the deadline. Where a property sale is needed to fund repayment, it is worth getting the grant and the sale moving early so the loan can be cleared before the 12 months expire.
When repayment can be deferred
Repayment is not always required within 12 months. Where the loan was secured against the person’s principal residence, a surviving spouse or partner, or a qualifying connected person, may apply to the HSE to defer repayment. Three conditions must all be satisfied: the home must be the applicant’s only residence; they must have lived there for at least three years before the original nursing home loan application was made; and they must have no interest in any other property. The HSE decides each deferral application.
A deferral postpones repayment; it does not cancel the loan. While deferred, the amount is adjusted by the Consumer Price Index (a measure of inflation), so the sum eventually repayable can rise or fall. Deferral most often matters when the family home is involved — our guide to the family home after death covers how ownership and occupation affect what happens next.
Selling the home to repay the loan
Where there is no deferral and the estate’s liquid assets are not enough, the secured property often has to be sold to clear the loan. The loan is settled from the sale proceeds, and only the remaining balance passes to the estate to be shared out. Because the Charging Order sits on the title, the loan must be discharged for the buyer to take clean title.
Timing matters here. The grant of representation (the court document authorising you to deal with the estate) must usually be in place before the home can be sold, and the sale itself takes time — all within the same 12-month window. If selling the home is the likely route, our guide to selling the home under Fair Deal explains how the charge and the sale fit together.
Tax relief on the repayment
When the loan is repaid, the repayment may be claimed under the heading of health expenses. The relief can be claimed either by the person who repaid the loan against their own Income Tax liability, or by the executor against the Income Tax liability of the deceased. This is a specific relief, so confirm eligibility with Revenue or a tax adviser before relying on it. Our guide to the deceased’s final tax return and Revenue refunds sets out how the claim is made and why nursing home costs are relieved at the marginal rate rather than the standard rate.
This relief is separate from any Capital Acquisitions Tax (CAT) that beneficiaries — those who inherit — may face. The loan reduces the net value passing to them, which affects the figures behind their CAT position. That is another reason to settle and document the loan accurately before sharing out the estate.