Last amended: 22 April 2014
Pension bonus impact
The pension bonus scheme (PBS) is designed to encourage a person to defer retirement. Contrary to this, the retirement assistance for farmers scheme (RAFS) encourages farmers to retire. Special rules apply to farmers registered under the pension bonus scheme, who subsequently apply for RAFS. These special rules are designed to allow them to utilise the benefits of both schemes.
Timing of pension bonus and RAFS activities
In order for a person to access both schemes a person must:
|
Step |
Action |
|
1 |
First register under the pension bonus scheme, |
|
2 |
then accrue at least one bonus period before divesting their farm, and |
|
3 |
then claim pension and bonus immediately |
Access to pension bonus scheme and RAFS
If a person registered under the pension bonus scheme then applies for assistance under RAFS they can give their farm away. By doing so, the gifting of the farm is disregarded under the disposal of assets rules.
Retirement Assistance for Farmers Scheme (RAFS)
Impact on bonus from giving away farm
The act of giving away the farm impacts on the bonus amount, which is calculated taking into account deemed income under the income test and the asset value under the assets test that would be maintained on the deprived value of the farm if RAFS were not enacted. The gift of the farm is not considered a gift for the purposes of a disposal preclusion period for PBS.