Being a home owner when it comes to assessing your pension isn’t as straight forward as you may think. If you live in a retirement village, are you a home owner? Of course you know if you own a home (or mortgage) or not, however in a retirement village, this arrangement can actually be seen as a lease or a licence arrangement, which is where the lines get blurry.
Why is it important?
Knowing if you are classed as a home owner or not can drastically affect your pension entitlements. This can also impact potential rental assistance.
How is this worked out?
This is dependant on the amount you pay. Retirement villages set their own fees and rules. Before you move in, you normally pay an entry fee or contribution, which could be the full market value of the unit. Centrelink look at this fee to determine your status as a home owner. As non home owners have a higher assets test limit than home owners, the difference between the two is called the extra allowable amount.
So what is the amount?
Currently, the extra allowable amount is $224,500. So if you paid more than that, you are classed as a home owner. If you paid less than that, you are classed as a non home owner and may be eligible for rental assistance.
Need more help?
The aged care process is complicated. At Aged Care Specialists Vic, we provide services to people about to enter aged care, in aged care or planning for retirement. We understand pensions, fees and Centrelink as we deal with it day in, day out. Contact us here for more information.