8th Nov 2010
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Entering aged care
Author: YourLifeChoices

YOURLifeChoices subscriber, Heidi, has recently moved her mother into an aged care facility. What is Centrelink’s two year ruling on the sale of her mother’s home.

Q. Heidi
My mother has just entered residential high level care in an aged care facility. There is no accommodation bond just an accommodation charge and the daily basic care fee payable but I believe there is some kind of two year ruling regarding Centrelink and the sale of her home. Can you please explain this to me, her daughter?

A. If a pensioner vacates their principal home to enter a care situation, their home continues to be an exempt asset under the assets test for a two year period and the person continues to be assessed as a homeowner. This provision applies irrespective of whether the person intends to return their principal home or not.
A care situation includes:
· community-based care - where care is provided in a private home for 14 consecutive days or more
· nursing homes
· long term hospital stay
· hostels - approved aged care homes that receive subsidies under the Aged Care Act 1997.

If, after two years, the person has not returned to their principal home:
· the pensioner is treated as a non-homeowner and the higher asset limits are apply, and
· the person's principal home is counted an assessable asset

Please also note that the principal home can be exempted indefinitely under the assets test if:
· the pensioner entered a care situation on or after 1 July 2004, and
· the resident is accruing a liability to pay an accommodation charge, and
· their principal home is rented.
(The rent received is also exempt from the income test for the period that the principal home is exempt under the income test.)

For more information, call Centrelink's Financial Information Service on 13 2300.





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