How to fund a senior services residence: the complete guide

Moving into a senior services residence (in French, residence services seniors or RSS) is as much a life project as a financial one. The good news is that several types of public support in France can significantly reduce the monthly cost, sometimes by several hundred euros. You just need to know which schemes you can use, the eligibility conditions, and how to combine them sensibly. Here is the complete guide to funding your senior services residence calmly.

The real cost of a senior services residence

Before talking about support, the bill itself needs to be clear. The cost of a senior services residence breaks down into two parts: the rent for the apartment (studio, one-bedroom or two-bedroom, furnished or not) and the associated services (24/7 safety, activities, access to common areas, optional catering, housekeeping and so on).

On average, the monthly budget sits between EUR 1,200 and EUR 2,500 depending on the town, the apartment size and the chosen service package. This is higher than a standard rent, but well below that of an EHPAD (nursing home with medical care), which averages EUR 3,000 to EUR 4,500. Above all, it covers a complete, secure and sociable setting that would otherwise become a stack of separate bills (personal alarm, subscriptions, home help and so on).

The funding challenge therefore comes down to identifying every cumulative form of support to reduce the real out-of-pocket cost.

Housing benefits: APL and ALS

The APL (Aide Personnalisee au Logement, the personalised housing benefit) and the ALS (Allocation de Logement Sociale, the social housing allowance) are paid by the CAF (the French family allowance fund, or the MSA for those working in agriculture). They apply to your rent, provided the residence is registered with the scheme (in French, conventionnee).

The good news is that most senior services residences are registered and let their residents receive APL. The amount depends on three factors: household income, household composition and the level of rent.

In practice, a single person on a modest pension may receive between EUR 100 and EUR 300 of APL per month. For couples, the amount depends on the combined pension. The simulation takes a few minutes on the CAF website, and the claim may be filed as soon as the lease is signed.

Note: if the residence is not registered for APL, ALS takes over on similar terms, though usually with slightly lower amounts.

APA in residence: who is it for, and what does it cover?

The APA (Allocation Personnalisee d’Autonomie, the personal autonomy allowance) is for people aged 60 and over who have lost some independence. It funds the support needed to stay at home: a care assistant, meal delivery, a personal alarm system and certain technical aids.

APA also applies in a senior services residence, because the residence is legally considered the resident’s home. This is a major difference with the EHPAD, where APA takes a specific form.

The amount depends on the degree of dependency (assessed against the AGGIR scale, from GIR 1, the most dependent, to GIR 6, the most independent). Only GIR 1 to 4 are entitled to APA. Income is taken into account when calculating the beneficiary’s contribution, but no ceiling fully closes off access to the support.

In practice, APA can cover several hours of home help per week within the apartment, easing both daily life and the budget.

The 25% tax reduction

This is the least known support, and yet one of the most advantageous for residents who are tax-resident in France.

Personal services billed within a senior services residence (housekeeping, help with administrative tasks, support, tutoring for visiting grandchildren and so on) qualify for a tax credit of 50% of the sums paid, within the annual ceiling set by the French tax authority.

In addition, a specific 25% tax reduction applies to accommodation expenses in senior services residences for older people who have lost some independence, capped at EUR 10,000 of annual expenses per person accommodated. The ceiling can therefore generate up to EUR 2,500 in tax reduction per year.

A key advantage of the tax credit: it is paid even to non-taxable households. The corresponding sum is then refunded directly by the French tax authority.

Combining support: the winning strategy

The power of funding a senior services residence lies in combining the schemes. Take a concrete example.

Mrs D., 78, receives a pension of EUR 1,600 per month. She moves into a one-bedroom OBEO Residences apartment at EUR 1,800 per month (rent plus services).

• APL: roughly EUR 180 per month (i.e. -EUR 180 on the rent).
• APA: assessed as GIR 4, she receives 4 hours of home help per week, partly covered by APA (roughly EUR 250 per month of actual support).
• Tax credit: on the share of services billed by the residence, she obtains EUR 600 of tax credit per year (the equivalent of EUR 50 per month).
• Tax reduction on accommodation: 25% of the eligible accommodation share, i.e. roughly EUR 1,800 per year in her case (the equivalent of EUR 150 per month).

Real out-of-pocket cost spread over the year: roughly EUR 1,220, i.e. 32% saving compared with the headline price. The financial step becomes considerably more affordable.

This support is not automatic: you must apply for it. An OBEO Residences adviser will help every future resident put together their files, in liaison with the CAF and the conseil departemental (departmental council).

What if you are a homeowner?

If you are leaving a home you own to move into a senior services residence, several options exist: let it out to receive a rent that funds the residence, sell it to free up capital, or opt for a viager (the French life-annuity sale). Each solution carries its own tax and estate implications. A conversation with a notary or a wealth-management adviser is recommended before deciding.

Conclusion: a life project, a controlled budget

Funding a senior services residence is no obstacle course: it is a structured process that draws on well-established public schemes. APL, APA, tax credit and tax reduction form a powerful combination that brings the monthly bill down to a level often comparable to a standard rent, with services and safety added.

To go further and obtain a personalised simulation tailored to your situation, our Pack Serenite includes full support in putting together your applications. Our advisers know the procedures and work hand in hand with the departmental CAF offices to speed up processing.

Discover the OBEO Residences Pack Serenite