May is thinking of gifting $10,000 each to her son and her three grandchildren. But she’s unsure if that means her Age Pension will be affected. We asked the Department of Human Services General Manager, Hank Jongen, for his advice.
What are the rules on gifting to family members? Would I be able to I gift $10,000 to my son and the same to my three grandchildren? Will my Age Pension be affected?
A. The value of assets a person gives away or sells for less than what they’re worth may still count towards the assets and income test for their Centrelink payments. The most a person can gift without affecting their payment is $10,000 in one financial year, and up to a maximum of $30,000 over five financial years. This applies to singles and couples combined.
If you wish to gift $10,000 to your son and $10,000 to each of your three grandchildren, then you would be exceeding the $10,000 limit in that financial year. The $30,000 gifted to your grandchildren would be assessed as a financial asset for a period of five years from the date of the gift. This means it will be counted under the assets test, and subject to deeming under the income test.
You will still have access to the allowable gifting of $10,000 per financial year in any two of the following four years, to remain under the $30,000 five-year limit. But any gifting made in the five years prior to receiving the Age Pension may also count in your assets and income tests.
All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a Centrelink Financial Information Services officer, financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.
If you have a Centrelink question, please send it to [email protected] and we’ll do our best to answer it for you.