Over-40s may be required to pay more tax to fund social care - here's what it could mean for you

Over 40s could soon be required to pay a tax which would fund social care (Shutterstock)

A plan backed by Health Secretary Matt Hancock could see over-40s pay a greater amount of tax to cover cost of social care in later life.

According to the Guardian the radical plans are under consideration by minister with the aim of ending the social care crisis.

Who would be required to pay more?

Under the proposed plan, everyone over the age of 40 would be required to pay more tax or National Insurance, or pay insurance for sizeable care bills when they are older. Money raised by the initiative would be used to pay for care of the elderly, whether they stay at home or in a care home facility. 

The plans are currently under examination by the new health and social care taskforce and the Department of Health and Social Care, according to the Guardian. 

The Prime Minister had promised to “fix the crisis in social care once and for all” and this approach is apparently emerging as the government's preferred route to fixing the crisis. 

Though social care is a devolved issue, the move could affect the whole of the UK as it would involve the tax system. 

According to Guardian sources, Hancock is a fan of the solution and the issue of social care has emerged as a priority against the backdrop of the coronavirus pandemic. 

Has this been done anywhere else?

Yes, this would follow a similar path to Japan and Germany. 

In Japan, once you reach the age of 40 you are required to contribute towards the funding of social care. 

In Germany everyone pays towards the funding of social care once they earn a salary, while pensioners also contribute. A total of 1.5 per cent of everyone's salary currently goes towards social care, with employers also required to contribute. 

Like the UK, both countries have ageing populations. They have been lauded for their sustainable approach to social care.