Aged Care - other
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Why is it so important to have a formal aggreement in place before settting up a Granny Flat arrangement?
If the relationship goes sour and the elderly person has put money into the granny flat arrangement and leaves it can be classed as gifting and the deprevation rules will apply.
Define a Granny Flat arrangement. Why are there specific rules on this
The transfer of homes or funds to other people in return for accomodation for life. Rules so the gifting and deprivation rules for centrelink don't take effect.
How will the resident and asset be treated if the granny flat interest is less than $135,000
Assessed as non homeowner
Asset is assessed but not deemed.
How ill the redient and the asset be treated if the granny flat interest is more than $135,000
Assessed as a homeowner
Asset is not assessed.
What is the formula for the test of reasonableness
Annual combined couple rate of pension x Tor conversion factor.
Example Granny Flat - Maggie is a pensioner and sells her $500k house and uses the proceeds to build a granny flat on her sons property - what are three considerations
Centrelink - Homeowner
Reasonableness - Annual couple x tor (14.58) = $431,772
She will be deemed to have gifted $68,228
Retirement Villages - what is what thing for people to consider if they are paying a big contribution to get into a retirement village?
If the money is locked up in a retirement village it may become a problem when they are trying to get into an aged care facility.
If the resident is renting out the home, when will it be exempt for cetnrelink and aged care puposes. Including the rental income.
When the person is paying either an accomodation charge or a periodical payment.
Why doesn't centrelink like the insurance bond in a trust strategy.
Control test - they are meant to be controlling the trust. If they are in age care how can they be controlling the trust?
What are a couple of things to be concerned about with the insurance bond strategy
Cost to set up and maintain
if the money was in a bank account it would hardly pay any tax - You need to put in about $1.2M before the strategy becomes nuetral.
What is the blue book trap?
Is where people get stuffed from filling in the centrelink assets test and then it can't get undone because centrelink may refuse to assess again.
What is the thing to watch out for for couples moving into aged care at the same time
Blue book trap. If they both put that they are a homeowner on the assessment then the home will not be assessed and they won't be able to get into anywhere because they don't have any assets.
What is the soluction to the blue book trap
Don't fill it in - try and get the facility to accept a stat dec instead. Note - maybe see if the facility wants a supported resident first.
What is a potential issue for people going into retirement villages for a short time?
High exit costs and delays in getting money for bond - some villages can take 2 years to pay and can still charge fees for up to 6 months after you have left.
Why won't some facillities take people from a retirement village?
lots of problems with bond. People die before the bond is paid and then beneficiaries refuse to pay the fees.
What should you ask to be ticked in the ACAT assessment? Why?
Respite - gives flexibility.
A _______ ACAT is valid forever
A ______ ACAT is valid for 12 months
A ______ ACAT is valid forever
Why could enduring guardianship be a good idea if more than one child?
Enduring POA is only meant to be for financial stuff. one child could complain after it is done and say that "mum didn't want to go to a home"
What is an issue if moved from granny flat to aged care within two years?
Could be considered gifting if it was reasonably foreseeable that she would need to go to aged care.
If you sell the house for less than thought can the facility enforce the bond?
If you don't want to sell the house what is an option
Just make the interest payments.
Why is it important not to pay all of the bond when you are renting out what was the PR? (3)
If bond is only part paid then
Rental income is not assessable
classessed as homeowneer
6 year rule on CGT.
If spouse is living in the house, still never pay the full bond. Why?
In case he dies, then you can get advantages if it is rented out.
What is a strategy to use if self funded retirees with regards to the income and asset form
They will only need to complete the form once. Make sure the income is low at this particular point in time.
Rule of thumb - less than $___ in assets will pay reduced ITF.
What would you like to do?
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