Relocatable homes and the pension

Increasing numbers of older Australians are choosing to live permanently in a mobile home or campervan.

There are a couple of Centrelink rules that apply to retirees accessing the full Age Pension and other benefits if they have a caravan park address.

First, the caravan has to be named as the primary place of residence. If you happen to still own your old home, and your spouse is no longer living there, then that residence will be assessed under the assets test and possibly the income test if you are earning rent money from the property.

Some retirees move to a caravan park and keep their houses because they want to earn rent from them. Others decide their houses are too big for them, so they allow their children to occupy their houses for free, while they downsize to a relocatable home.

In these situations, Centrelink will apply the income test to any rent you are earning and the assets test to the home. As the house is no longer considered the primary place of residence, it becomes an asset and, depending on its value, will likely reduce the amount of Age Pension you receive.

And if you do decide to sell your house and move into a motorhome, think carefully about what you will do with your windfall, because Centrelink will also want to factor in any extra cash into their decision on your Age Pension.

On the positive side, folk who live permanently in caravan parks can receive rent assistance to offset the cost of site hire. They also receive help in managing their money through a Centrepay account.

Essentially, Centrepay is a scheme whereby deductions are made from your payment for accommodation-related costs. These include caravan park fees, such as rental or site costs, electricity bills, vehicle registration and insurance cover for your caravan.

And you can set and forget by using the Electronic Verification of Rent. This is a secure, automated process that lets businesses electronically verify and update your rent amount with Centrelink.

Have you ever considered selling up and moving into a relocatable home? Do you currently enjoy the nomad life on Australia’s roads? Would you recommend it to others? What pitfalls have you discovered?

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