fREEQUENTLY ASKED QUESTIONS & Terminology
FAQs + ABBREVIATIONS
How could my pension be cancelled?
Your house is currently exempt for pension purposes – if sold, once settled, and money in the bank - could put you over the limit for pension
Or - if you rented out your home to help with aged care fees – the income could reduce your pension + after 2 years house will be counted as an asset and treated the same as sold
There is a third possibility – speak to us about the two-year exemption rule if property sold
How could it be that my will wishes may not be honoured?
If in your Will you wanted your home to go to kids and remainder passed to a charity – and then it was sold it to pay for care –and paid no attention had been paid to the will –it could all end up in the hands of the charity
How early could OUR FAMILY consider Aged Care Planning?
At least 5 years in advance meets Centrelink current guidelines
What does a protected person mean?
Centrelink has several definitions – the most common being a spouse or partner
Why would the Aged Care facility ask me if we had any money?
In the main they like to receive lump sum sums ( as they are in fact interest free loans from consumers) of money as opposed to daily payments and they are not required to pay any income, or capital gain on your funds. Additionally, after 1/7/25 – the facility is allowed to deduct a retention amount of 2% for the first 5 years of any lump sums paid
Should we use a placement person for aged care or do it ourselves?
If your family cannot find a place by picking up the phone and ringing around in your area – yes – this an optional service available
I’ve paid taxes, contributed to society, raised my kids, paid up to 18% on a previous mortgage – why could I be asked to sell my home to pay for care?
No plan has been put in place for a possible aged care event.
What is the “too late” position mean in relation to aged care?
Too late to plan – same as no planning having been done – your options become reduced – and any attempt to re-arrange affairs then could be undone by Centrelink – especially if done with the intention to reduce aged care fees
What is the new Hotelling Contribution from 1/7/25?
A new fee that if you have income or assets above set limits you will be assessed to contribute to the cost of your care. This is payable if assets exceed $238,000 or income greater than $95,400 or a combination and will be indexed. The maximum will be $12.55 a day ($4, 562.20) from July 25 and all new residents entering aged care will be tested for this fee
Why have I heard people have had to sell their houses to pay for care?
They did no planning and sometimes it is an option put in front of consumers.
What is the new Non-Clinical Care Contribution?
A fee based on income and assets with a Lifetime Cap of $130,000 or 4 years in residential care whichever is reached first. It is paid if assets are over $502,981 and/or income greater than $131,279 and indexed. The current maximum is $101.16 per day or $36,822.24 per year
What is the best way to plan?
Do it now – don’t wait till too late and an Aged Care event happens in your family
My Mum had to go to care and the Aged Care people asked me if we had a house or money to pay for the room – Why was that?
They want the “interest free” lump sum from Mum
What is a RAD?
A Refundable Accomodation Deposit
What is a reD?
It’s an alcoholic drink you reach for known as wine - when you have had enough of these Aged Care FAQ’s.
What is a DAC?
A Daily Accommodation Contribution
What is a MAS?
A Maximum Accommodation Supplement
What is a HSC?
A Hotelling Supplement Contribution (From 01/07/25 and could apply to new residents entering care)
What is a NCCC?
The Non-Clinical Care Contribution (From 01/07/25 and could apply to new residents entering from then)
What is a FAT?
First Asset Threshold (From 01/07/25)
What is a FIT?
First Income Threshold (From 01/07/25)
What is a Sit?
Second Income Threshold (From 01/07/25)
What is a tit?
Third Income Threshold (From 01/07/25)
What is a FIT2
Fourth Income Threshold (From 01/07/25)
What is a AFA?
Asset Free Amount
What is a SAT?
Second Asset Threshold
What is a TAT?
Third Asset Threshold`
What is a FAT2?
Fourth Asset Threshold
What is the threshold for paying the full accommodation price?
From 1/725 when Means Tested Amount (MTA) exceeds the Maximum Accommodation Supplement (MAS)
When could a Hotelling Contribution be charged to an Aged Care resident?
From 1/7/25 if the MTA amount is greater than the MAS (for any new residents)
How much is Hotelling Contribution?
$12.55 a day from 1/7/25
How much is the Income Free area from 1/7/25?
Currently $32,819
What is Current House Cap?
$206,039.20
What does house cap mean?
You could own a property in Brisbane for $2m – however for Aged Care Assessment it is assessed at $206,039.20 and that could be for both residents
What does RAD retention mean?
From 1/7/25 – Any RAD (Refundable Accommodation Deposit) paid will be subject to a retention amount of 2% a year for up to 5 years
What’s the cap on the “Non-Clinical Care Contribution” amount?
From 1/7/25 $130,000 indexed
What’s the 2% retention amount deducted monthly mean?
From 1/7/25 If you pay a lump sum toward accommodation in residential aged care – 2% per year can deducted paid monthly to the facility – nonrefundable for up to 5 years.
What is the basic daily fee for care?
From 20th March 25 - $63.82 per day
How can I reduce my aged care fees?
Plan well in advance – Plan while not needing Care - hoping you never will - not on the Friday before the Monday a person is going into care – as Centrelink can reverse your actions if done to reduce Aged Care Fees.
How could a reverse mortgage help pay fees?
Drawing on equity in home to pay for fees so a home may be retained rather than be sold to pay for care fees
What’s the income threshold for paying the maximum accommodation fee for a room in care?
As of April 25 - $84,656.52
What happens if assets greater than $502,981 or income greater than $131,279?
From 1/7/25 - the maximum NCCC of $101.16 a day will be payable
When is the Hotelling Supplement payable?
If MTA > MAS (If your Means Tested Amount is greater than the Maximum Accommodation Supplement)