Property and items you or your partner own or have an interest in, including assets held outside Australia, can affect your payment.
When dealing with us, it is important to be aware of the different types of assets we assess and how we use them to work out your income support payment.
We take most of your assets into account when calculating your payment. The value of your assets is what you would get for them if you sold them at market value.
Generally, any debt secured against a particular asset is deducted from the value of that asset.
Real estate assets
The value of any real estate, apart from your principal home, is included in your assets test. Your real estate assets can include any property owned wholly or jointly by you and your partner, privately or within a business structure.
Read more about how real estate assets can affect your payment.
Granny flat rules
If you transfer assets or money for a right to reside in a property owned by another person then you may be assessed under the granny flat rules.
Retirement village contributions
The amount of entry contribution you pay to reside in a retirement village affects whether you are considered to be a home owner and if the amount will be included in your assets test.
Read more about how retirement villages form part of your real estate assets .
If you have a life interest in an asset, or you are entitled to receive income for your lifetime, it may have an asset value.
Read more about how life interests form part of your real estate assets .
Your financial investments value is used to calculate your income support payment rate under both the assets and income tests.
Read more about how financial investments affect your payment.
Superannuation owned by you or your partner is included in your assets test if the owner is over age pension age.
Read more about how your superannuation investments can affect your payment.
An income stream is a regular series of payments made to you directly from accumulated superannuation contributions or purchased using either superannuation or ordinary monies. The different types of income streams are assessed differently.
Read more about how your superannuation income streams can affect your payment.
If you are involved in a business under a partnership or sole trader structure, we need to work out the portion of the business’ income and assets that relate to you in order to establish how it may affect the amount you are paid.
Read more about business structures that may affect your payment.
When you are determined to be a controller of a private trust or private company, we will use the income and assets of that trust or company to work out your income support payments.
Read more about how private trusts and private companies can affect your payment.
Although it is not something that everybody wishes to consider, there can be benefits in planning and paying for some aspects of your funeral now. There are a range of different funeral investments that may be either partially or fully exempt from the asset test.
Assets given away
You or your partner can give away money, other assets or income to any value you choose at any time. However, the rate of income support payment you and your partner receive may be affected if it is worth more than the allowable gifting amount.
Other assets we assess
Other assets we assess when working out your payment include
the market value of your
and your partner's:
- motor vehicles
- boats and caravans
- licenses, for example fishing or taxi
- surrender value of life insurance policies
- collections for trading, investment or hobby purposes, and
- household contents and personal effects
Assets we do not assess
There are 2 types of assets we do not include when working out your payment rate.
An exempt asset is a specific type of asset that is disregarded irrespective of its value when we work out your payment rate. We consider the following assets exempt under the assets test:
- your principal home and generally up to 2 hectares of privately used, surrounding land on the same title as your home. In some cases, rural customers and primary producers with larger properties on the same title may be exempt
- some income streams depending on their purchase date
- all Australian superannuation and rollover investments not in the drawn down phase in an approved fund until you reach age pension age
- any property or monies left to you in an estate which you are not yet able to receive, generally for a period up to 12 months
- a cemetery plot and either a prepaid funerals or up to 2 funeral bonds that cost no more than the allowable limit
- aids for people with disability
- monies received from the National Disability Insurance Scheme to provide for the needs of people with disability
- proceeds from the sale of your principal home you intend to use to purchase another within 12 months. The funds will be used in the calculation of your financial assets to determine the deemed income under the deeming provisions
- most compensation or insurance payments for loss or damage to buildings or personal effects
- accommodation bonds paid on entry to residential aged care
- first home saver accounts
- your former principal home if you entered aged care and are paying or liable for an accommodation charge and your former home is rented out
- any life interest, reversionary interest, remainder interest or contingent interest unless it was created by you, your partner or at the time of death of your partner
- a Special Disability Trust if it meets certain requirements and does not have assets over the concessional asset limit
- your principal home if you temporarily vacate it, for up to 12 months, and
- granny flat rights where the amount transferred for the right was more than the extra allowable amount
The specific types of assets excluded are:
- genuine capital investment made by another person in a private trust or private company attributed to you
Where your farm is within an area declared as Exceptional Circumstance, your farm’s assets are exempt due to eligibility for a Farm Household Allowance. Exceptional circumstances can include drought assistance and is managed by the Department of Agriculture.
Asset test limits
Most pensions, allowances and concession cards have asset limits. These limits determine if your assets will affect your payment rate.
The asset test limits are updated in January, March, July and September each year.
Assets test limits for allowances and Parenting Payment SingleSource: www.humanservices.gov.au