A YourLifeChoices reader is contemplating looking after her ageing parents after she is made redundant and would like to know what options are available to her.
Q. Sophie
I’m in my mid-50s and I am about to be made redundant as the business I work for is closing down.
At the same time, my parents are both in their 80s and are increasingly needing help around the home.
I’m weighing up if I should look for work, become a carer for my parents, or even a mixture of both. How does registering as a carer work and how would it affect me financially if I wanted to be a part-time carer and work part-time?
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A. It’s great you want to look after your parents, but unfortunately it’s not as simple as ‘registering’ to get Centrelink payments for caring for others.
Without Sophie’s complete financial details, we are only able to give guidance about what you can apply for at Centrelink. For the purpose of this story, we are assuming Sophie is single.
Centrelink has two payments for carers, the carer allowance and the carer payment.
Carer allowance
The carer allowance eligibility rules are less stringent than the carer payment, but only pays $153.50 per fortnight.
There is no asset test for the carer allowance, but there is an income test. You and your partner’s combined income must be less than $250,000 per financial year, before tax.
There is no income test for the person you care for.
Centrelink will want to know about the person you care for, including evidence of assessment by a medical professional or diagnosis of a terminal illness. They must also meet residency rules.
Centrelink will ask how you care for your parents and their treating doctor will need to complete a medical form.
The good news is you may get a carer allowance for each person you care for, but it’s still probably not enough to live on.
Carer payment
The carer payment is for people who care for someone with a disability, medical condition, is frail-aged, or with a terminal illness.
This payment is for people who provide a large amount of care, or roughly equivalent to a working day, each day, or the level of care stops you from working full time.
The amount you receive depends on your circumstances and both you and the person you care for must be eligible.
As well as the above residency rules, the carer must pass the income and asset tests.
Under the income test, a single person can earn up to $204 per fortnight. For everything over $204 sadly you will be taxed at 50 cents in the dollar.
Under the asset test, you can have assets worth up $674,000 for homeowners and $916,000 for non-homeowners and still be eligible for the carer allowance.
The person you care for must also meet income and assets test limits. If they don’t get an income support payment from Centrelink or the Department of Veterans’ Affairs, their:
- income must be less than $135,640 a year before tax
- assets must be worth less than $836,750.
The assets test doesn’t include the principal home and first 2 hectares surrounding it.
The person or persons you care for must have a disability or medical condition likely to last at least six months or a terminal illness. They must also need constant care in their home, your home or in hospital.
Centrelink will need to know what sort of care you provide, such as mobility support, feeding, cleaning and supervision for medications.
Their treating doctor will need to complete a medical form.
If one of Sophie’s parents doesn’t qualify for higher care, she may still be able to get carer payment if she’s caring for multiple people as Centrelink considers the combined needs of the people you are caring for.
As well as information for the income and assets tests, supporting documents for your claim include your proof of identity, tax file number, relationship to the person you are caring for and your own personal relationship status and employment status including any other payments you receive from Centrelink.
The maximum payment Sophie can expect is $1020.60 per fortnight, although she may also be eligible for the pension supplement and energy supplement.
For more information, visit here.
Are you on the carer’s payment? Why not tell us about your experience applying for it in the comments section below?
Also read: Can I apply for the Age Pension if my partner is younger?
