Buying a Care Home
Written and reviewed by the Care Home Accountants editorial team. Last reviewed 28 July 2026.
Buying a care home means buying a regulated trade, a building and a set of relationships with residents and funders at the same time. Each part carries its own price and its own risk.
We walk through how the deal is valued, how goodwill and the property are treated, why CQC registration governs the timing, and the capital gains tax that will land when the business is eventually sold.
Valuation and the Goodwill in the Business
A care home is usually valued on its earnings and its occupancy, with the building underpinning the figure. The part of the price above the value of the identifiable assets is goodwill, which reflects the established trade, the reputation and the funder relationships.
How the price is split between goodwill, fixtures and the property matters for tax on both sides. We work through the split as part of buying or selling a care home, because it shapes the allowances the buyer can claim and the gain the seller reports.
The Property and the Trade
Most deals are structured either as a purchase of the trade and assets, including the property, or as a purchase of the company that owns them. The two routes carry different tax and liability profiles, and the choice is rarely neutral.
The fixtures and plant that come with the building open up allowances, which we cover in the guide to capital allowances. Agreeing how those are valued in the contract protects the claim later.
CQC Registration Before Completion
A care home cannot lawfully operate without the buyer being registered with the Care Quality Commission for the regulated activity. Registration is not automatic on a change of ownership, and it takes time to secure.
The registration timetable usually sets the completion date rather than the other way round. Buyers who leave it late risk a gap in which the home cannot legally take fees, so the application runs in parallel with the legal and financial work.
Capital Gains Tax on a Future Sale
Goodwill and the property are chargeable assets, so a later sale produces a capital gain. Business Asset Disposal Relief taxes qualifying gains at 18% for disposals made from 6 April 2026, up from 10% until 5 April 2025 and 14% in between, subject to a lifetime limit of £1,000,000.
Gains above the lifetime limit, or that do not qualify, are charged at the main business-asset rate of 24% for a higher-rate taxpayer. The government sets out the conditions for Business Asset Disposal Relief, and the current capital gains tax rates confirm where a gain falls outside it.