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Other Disregarded Assets
Asset-test exempt income streams
VEA: subsection 52(1)(d)
The value of an asset-test exempt income stream is a disregarded asset for assets-test purposes.
For partially asset-test exempt income streams, half of the value is a disregarded asset for assets-test purposes.
More: 10.5 Income Streams.
Foreign superannuation pensions
VEA: subsection 52(1)(da)
The value of any foreign superannuation pension is a disregarded asset for assets-test purposes.
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Superannuation funds and approved deposit funds
VEA →The value of a person's investment in a superannuation fund or an approved deposit fund is a disregarded asset until the person:
- reaches pension age (or qualifying age for income support supplement recipients); or
- commences to receive a pension or annuity from the fund. More →
Assessing decoration awards for valour
VEA →Provided it is not used for the purposes of investment or as a hobby, the value of any medal or other decoration awarded for valour that is owned by a person is a disregarded asset. This includes medals and other decoration awarded to someone else beside the owner.
Assessing aids for disabled
VEA →- any of the person's personal property that is designed for use by a disabled person,
- any part of the person's personal property that is attributable to modifications made to that property to enable it to be used by disabled persons, and
- modifications to a car for use by a disabled person, but not the vehicle itself.
If DVA provided the person with a motor vehicle under the Vehicle Assistance Scheme, the value of that vehicle is also a disregarded asset. More →
Vehicle Assistance Scheme
Amounts paid under a home equity conversion agreement
VEA →An amount received by a pensioner within the preceding 90 days which is paid to or on behalf of that person or their partner under a home equity conversion agreement is a disregarded asset to the extent that the total amount owed by the person or by the person and their partner under home equity conversion agreements from time to time does not exceed $40,000. More →
Payments made in respect of prisoners of war during World War II
The 2001 Australian Government Budget provided for a one-off payment of $25,000 to all Australian service personnel and civilians who were held captive by Japan during World War II or their widows or widowers who were alive on 1 January 2001.
This $25,000 one-off payment is disregarded under the assets test by allowing it as a deduction from the value of the person's total assets for life. More →
See the Compensation (Japanese Internment) Act 2001, Item 12. This item covers both those under the Act – civilians and widows, and those under the Veterans' Entitlements (Compensation – Japanese Internment) Regulations 2001, that is, veterans.
Compensation (Japanese Internment) Act 2001
Veterans' Entitlements (Compensation – Japanese Internment) Regulations 2001
If the recipient of the payment remarries, the $25,000 continues to be disregarded and is deducted from the joint assets of the recipient and their partner, during the recipient's lifetime. The assets test exemption does not transfer to another person, including the widow/er, upon the death of the recipient of the payment.
The payment is regarded as an exempt lump sum under the income test. More →
The same does not apply to ex-gratia payments made:
- to British groups held prisoner by the Japanese during World War II or their surviving widows/widowers, or
- by a Commonwealth or allied country to those surviving Japanese internment or their surviving widows/widowers.
These payments are regarded as an exempt lump sum for income test purposes, but if the money received from these payments is invested, used to acquire assets or disposed of, then the subsequent investment, asset acquisition or disposal is assessed using the appropriate income and assets test rules. More →
National Disability Insurance Scheme amounts
VEA →NDIS amounts held by, or on behalf of, an NDIS participant to pay for future disability expenses under their NDIS plan are an exempt asset.
The assets test exemption also applies to any actual returns earned, derived or received on NDIS amounts.
The calculation of the disregarded NDIS asset amount is –
- the sum of the NDIS amounts received, and any return on those amounts,
LESS
- those amounts spent in accordance with the person’s NDIS Plan.
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Section 52(1)(f)
If a person, their partner, or a dependent child of either, is a disabled person, the value of the following is to be disregarded:
Vehicle Assistance Scheme
See the Compensation (Japanese Internment) Act 2001, Item 12. This item covers both those under the Act – civilians and widows, and those under the Veterans' Entitlements (Compensation – Japanese Internment) Regulations 2001, that is, veterans.
Compensation (Japanese Internment) Act 2001
Veterans' Entitlements (Compensation – Japanese Internment) Regulations 2001
Currently, the pension age for a veteran is 60 years of age (VEA 5QA).
The pension age for a non-veteran is determined by the table below:
Date of birth (both dates inclusive) | Age Pension age |
1 July 1952 to 31 December 1953 | 65 years and 6 months |
1 January 1954 to 30 June 1955 | 66 years |
1 July 1955 to 31 December 1956 | 66 years and 6 months |
On or after 1 January 1957 | 67 years |
Qualifying age is defined in section 5Q(1) of the VEA and is equivalent to the pension age for a veteran which is described in section 5QA VEA as:
- 60 years for a male,
- for females subject to age equalisation (refer to the table in section 5QA VEA).
The Department of Veterans' Affairs.
Has the same meaning as in the National Disability Insurance Scheme Act 2013, and means an amount paid under the NDIS in respect of reasonable and necessary supports funded under a NDIS participant’s plan.
Has the same meaning as in the National Disability Insurance Scheme Act 2013, and means a person with disability who meets the access requirements to become a participant in the NDIS.
Has the same meaning as in the National Disability Insurance Scheme Act 2013 and is the plan agreed between an NDIS participant and a Disability Care Australia planner setting out the reasonable and necessary supports the participant requires to achieve their goals and aspirations and describing how these supports will be provided.
A person's 'partner' is someone who is a member of a couple with that person.
Section 5F(1) of the VEA defines dependent child as having the same meaning as in the Social Security Act 1991. For income support purposes, dependent child is defined as:
Child under 16 years
- the pensioner has legal responsibility either alone or jointly with another person for the day to day care, welfare and development of the young person AND the young person is in the pensioner's care, or
- the young person is not a dependent child of someone else AND the young person is wholly or substantially in the pensioner's care.
A child under 16 years cannot be considered a dependent child if:
- they are not a full-time student, and
- their weekly income from any source is more than the amount specified in section 5(3)(c) of the Social Security Act.
Child 16 years or older
A young person who has turned 16 years but is under 22 years can still be a dependent child of the pensioner if:
- they are wholly or substantially dependent on the pensioner, and
- their income in the financial year will not exceed the personal income limit, and
- they are receiving full-time education at a school, college or university.
A child over 16 years cannot be considered a dependent child if:
- they receive a social security pension or benefit such as youth allowance, or
- their personal income is more than the amount specified in section 5(4)(b) of the Social Security Act.
Income includes earning from casual, part-time or full-time earnings.
Note: the meaning of a dependent child for DVA income support pension purposes is not the same as the meaning for Family Tax Benefit purposes.