We are considering giving our daughter, a single mother with two children, a $200,000 advance on her inheritance to help her buy her first home.
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her → consider → home
We intend to document the advance properly and also protect it against any claim by a future partner.
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We → intend → partner
I am 69 and my wife is 63, we are both retired and live in Western Australia.
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we → live → Australia
We have $1.2 million in superannuation, $320,000 in a term deposit and $137,000 in a Mojo account.
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We → have → account
We own our $1 million home, two cars and have no debt.
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We → own → debt
I understand that Centrelink would treat the $200,000 advance as a gift.
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Centrelink → understand → gift
How long would the excess gift continue to count for Centrelink purposes?
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gift → continue → purposes
On our present assets, and assuming expenditure of about $75,000 a year and investment returns of 8 per cent, I estimate it could be around 10 years before we qualify for a meaningful part age pension.
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we → assume → pension
Does that seem reasonable?
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that → seem → ?
Finally, would making the gift have any effect on our eligibility for the Commonwealth Seniors Health Card?
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making → make → Card
Provided the payment to your daughter is an unconditional gift and not a loan, it will cease to exist for Centrelink purposes in five years.
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it → provide → years
If you go to the Retirement Drawdown Calculator on my website, you will discover that a capital sum of $1,657,000 will last for your lifetime, if you draw $75,000 a year, indexed at 3 per cent, and the fund earns 8 per cent.
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fund → go → cent
If you increase the drawings to $100,000 a year, it would still be $1 million after 30 years.
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it → increase → years
Remember, suppose those assets fell to $1 million, you would still be receiving a pension of just $363 a fortnight.
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you → remember → 363
At that level, the main benefit is from the pension concession card, but you can still get many benefits with the Commonwealth Seniors Health Card (CSHC).
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you → get → Card
I understand that Centrelink would treat the $200,000 advance as a gift.
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Centrelink → understand → gift
How long would the excess gift continue to count for Centrelink purposes?
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gift → continue → purposes
The CSHC has no assets test.
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CSHC → have → test
Eligibility is based on adjusted taxable income plus deemed income from relevant account-based superannuation pensions.
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Eligibility → base → pensions
Superannuation held in accumulation phase is not deemed, although interest earned on bank deposits is assessable income.
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interest → hold → deposits
In your case, you are 69 and may qualify for the card now, but your wife, at 63, will have to wait until she reaches age pension age of 67.
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she → qualify → 67
With the changes coming to family trusts after the budget, if a trust holds investments in managed funds and the distributions or dividends are automatically reinvested, will the trust still have to pay the new minimum 30 per cent tax?
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trust → come → tax
From July 1, 2028, family trusts caught by the proposed changes will be subject to a minimum 30 per cent tax on their taxable income.
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trusts → catch → income
It makes no difference whether managed fund distributions or dividends are paid in cash or automatically reinvested.
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distributions → make → cash
They remain taxable income, along with any associated franking credits.
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They → remain → credits
Individual beneficiaries will receive a non-refundable tax offset reflecting their share of the tax paid by the trustee.
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beneficiaries → receive → trustee
However, under the current proposals, corporate beneficiaries will not receive this offset.
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beneficiaries → receive → offset
If the trust’s franking credits exceed its minimum tax liability, the excess can be refunded to the trustee, but not to individual beneficiaries.
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excess → exceed → beneficiaries
The proposals also provide options to restructure investments outside the trust or elect to identify specific beneficiaries to avoid the minimum tax applying at the trustee level.
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proposals → provide → level
Given the potential consequences, trustees should seek professional advice once the legislation is finalised to determine the best approach for their circumstances.
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legislation → give → circumstances
After reading your article about the five numbers you need to know when choosing aged care, I was very interested in where you say that if she keeps her home, she will pay zero – no clinical care contribution.
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she → read → zero
My wife is 86 and I am 89, and we are self-funded retirees.
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we → fund → ?
I still live in our family home.
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I → live → home
On entry, I paid $500,000 for her to move into a shared room.
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her → pay → room
I then pay a daily fee of $66.80, a means-tested amount of $41.42, additional services of $29.45 and a hotelling fee of $29, which according to you should be capped at $22.
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which → pay → 22
I rang aged care, and they know nothing about the statement that if you keep your home you pay nothing towards the non-clinical care contribution.
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you → ring → contribution
Which one of these fees that I pay is actually the clinical care contribution, and why are they called different things depending on who you talk to?
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you → pay → who
I would really appreciate it if you could help me understand whether I am, in fact, paying too much.
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I → appreciate → much
Because your wife moved into aged care before November 1, 2025, she is grandfathered under the old fee arrangements.
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she → move → arrangements
The article I wrote was for people considering a move into aged care and dealt with the fees that apply today.
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that → write → fees
…and 19 more, not listed.
The Aporia
