Caravan-living catches that could affect your pension

Living in a caravan has catches that could affect your Age Pension.


Car manufacturing might be dead in Australia, but makers of motorhomes are powering ahead as people from all walks of life hit the bitumen with campervans and caravans.

The stock exchange-listed, recreational vehicle manufacturer, Apollo, last month posted an impressive profit and is on track to move into a larger site on expectations of strong growth.

And it’s not only young families and grey nomads on vacation who are opting for caravan park accommodation. Increasingly, some older Australians are choosing to live permanently in a campervan.

However, there are a couple of Centrelink rules that apply to retirees accessing the full Age Pension and other benefits if they have a trailer 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 a means test will apply to the benefit payment.

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 caravans.

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 a caravan park receive rent assistance to offset the cost of hiring a site. They also receive help 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.



    To make a comment, please register or login
    4th Nov 2017
    Only reason to nominate your caravan as your home is that you maybe entitled to rent assistance.

    However you can still have your house as your main residence for up to six years if you rent it out and indefinitely if you don't. That is for both pension and CGT purposes.

    You needs to do your sums to see what's best for you.
    4th Nov 2017
    Sorry Bonny, this info is not correct. You can't have your home as your main residence for more that 12 months, if you have acted it to travel, unless you return to it and leave again, within the 12 month period. There os no 6 year rule in regard to Pension. Not sure about CGT though.
    10th Nov 2017
    has anybody bought themselves that "recommended Trackr?
    12th Feb 2018
    whats ""recommended Trackr?" ??

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