Provided you are living in the property, the Council have to disregard the property and your Wife's share therefore does not come into the equation when calculating how much capital she has.
I hope this clarifies the position for you.
Hi, if your wife becomes state funded in the future, and then dies, and the house is sold, the Council can't claim any monies from the Sale as reimbursement towards Nursing home fees. This is because the house is totally disregarded during her lifetime (provided you are are living there).
Your Wife's half share in the property only forma part of her capital when assessing Nursing home fees entitlement IF it is sold during her lifetime, and in such circumstances, the half value is "added to her capital".