VEA ? [2]
The value of any life interest of a person is a disregarded asset unless it was created:
When the life interest [3] is in a person's principal home [3], the value of the interest is a disregarded asset.
VEA ? [4]
The value of any contingent, remainder or reversionary interest is a disregarded asset unless it was created by:
VEA ? [5]
A person's granny flat [3] interest in their principal home is a disregarded asset if the interest was acquired:
VEA ? [7]
A person's right or interest in a sale leaseback home is a disregarded asset (i.e. the person is taken to be a home owner) if the:
Actuarial valuations are required for the following:
A life interest arises when a pensioner:
A life interest remains current until the pensioner:
The principal home has the meaning given by subsection 5LA(1) [18] of the VEA and subsection 5LA(2) [18] of the VEA. The principal home of a person is generally the place in which they reside. In certain circumstances, however, the principal home of a person can be the place in which they formerly resided. The following property is regarded as part of the principal home.
A granny flat interest exists if a person has established a right to accommodation for life, or a life interest in another person's private home.
Granny flat interests are established by the following methods:
Refer to Section 5MA(2) [18] of the VEA for the full definition.
The "extra allowable amount" is the difference between the property owner assets value limit and the non property owner assets value limit which applies to the person.
As the property and non property owner assets value limits are indexed or adjusted on an annual basis, the extra allowable amounts also increase annually.
The assets value limits applied to this formula are the limits applicable at the time the person made the entry contribution to enter the special residence.
Refer to Section 52N [18] of the VEA for the full definition.
A life interest arises when a pensioner:
A life interest remains current until the pensioner:
The principal home has the meaning given by subsection 5LA(1) [18] of the VEA and subsection 5LA(2) [18] of the VEA. The principal home of a person is generally the place in which they reside. In certain circumstances, however, the principal home of a person can be the place in which they formerly resided. The following property is regarded as part of the principal home.
A contingent interest happens when the interest in an asset is dependent (contingent) on an event happening. The event may never happen.
A remainder interest is created when the owner of an asset transfers the legal title of the asset to another person and retains, or grants to a third person, an interest in the asset for life or a specified length of time. The interest held by the person is called a remainder interest. The person does not gain the benefit of their interest until the original owner's interest ends.
A reversionary interest happens when the owner of an asset grants an interest in the asset to another person for life or for a specified length of time. Ownership of the asset is not transferred.
When the other person's interest in the asset expires, the interest is returned (reverts) to the owner.
Valuable consideration is defined as receipts not in money form but capable of being valued in money terms.
Links
[1] https://clik.dva.gov.au/user/login?destination=node/16433%23comment-form
[2] https://clik.dva.gov.au/book/export/html/16433#tgt-cspol_part10_ftn249
[3] https://clik.dva.gov.au/%23
[4] https://clik.dva.gov.au/book/export/html/16433#tgt-cspol_part10_ftn250
[5] https://clik.dva.gov.au/book/export/html/16433#tgt-cspol_part10_ftn251
[6] https://clik.dva.gov.au/book/export/html/16433#tgt-cspol_part10_ftn252
[7] https://clik.dva.gov.au/book/export/html/16433#tgt-cspol_part10_ftn253
[8] https://clik.dva.gov.au/book/export/html/16433#tgt-cspol_part10_ftn254
[9] https://clik.dva.gov.au/service-eligibility-assistant-updates/all-determinations-order-date-signed-oldest-most-recent/determinations-under-vea
[10] https://clik.dva.gov.au/book/export/html/16433#ref-cspol_part10_ftn249
[11] https://clik.dva.gov.au/book/export/html/16433#ref-cspol_part10_ftn250
[12] https://clik.dva.gov.au/book/export/html/16433#ref-cspol_part10_ftn251
[13] https://clik.dva.gov.au/compensation-and-support-policy-library/part-9-principles-determining-pension-rate/92-residential-situation/925-special-residence-assessment-rules
[14] https://clik.dva.gov.au/book/export/html/16433#ref-cspol_part10_ftn252
[15] https://clik.dva.gov.au/book/export/html/16433#ref-cspol_part10_ftn253
[16] https://clik.dva.gov.au/compensation-and-support-policy-library/part-9-principles-determining-pension-rate/92-residential-situation/925-special-residence-assessment-rules/sale-leaseback-arrangements
[17] https://clik.dva.gov.au/book/export/html/16433#ref-cspol_part10_ftn254
[18] http://clik.dva.gov.au/legislation-library