Commonwealth Consolidated Acts Commonwealth Consolidated ActsValue of unrealisable asset to be disregarded
(1) If section 1129 applies to a person, the value of:
(a) any unrealisable asset of the person; and
(b) any unrealisable asset of the person's partner;
is to be disregarded in working out the person's social security pension rate.
Deduction from social security pension maximum payment rate
(2) If section 1129 applies to a person, there is to be deducted from the person's social security pension maximum payment rate an amount equal to the person's adjusted annual rate of ordinary income.
Adjusted annual rate of ordinary income
(3) A person's adjusted annual rate of ordinary income is an amount per year equal to the sum of:
(a) the person's annual rate of ordinary income (other than income from assets); and
(b) the person's annual rate of ordinary income from assets that are not assets tested; and
(c) either:
(i) the person's annual rate of ordinary income from unrealisable assets; or
(ii) the person's notional annual rate of ordinary income from unrealisable assets;
whichever is the greater; and
(d) an amount per year equal to $19.50 for each $250 of the value of the person's assets (other than disregarded assets); and
(e) any amounts that are not income of the person because of paragraph 8(8)(zp).
Assets tested asset
(4) For the purposes of subsection (3), an asset is not assets tested if the value of the asset is to be disregarded under subsection 1118(1).
Notional annual rate of ordinary income from unrealisable assets
(5) A person's notional annual rate of ordinary income from unrealisable assets is:
(a) the amount per year equal to 2.5% of the value of the person's and the person's partner's unrealisable assets; or
(b) the amount per year that could reasonably be expected to be obtained from a purely commercial application of the person's and the person's partner's unrealisable assets;
whichever is the less.
Family farms
(6) If:
(a) an unrealisable asset is a farm; and
(b) the farm is operated by a person who is a family member of the person to whom this section applies; and
(c) it is not reasonable to expect the farm to be used for another purpose;
the Secretary, in working out the amount per year that could reasonably be expected to be obtained from a purely commercial application of the farm, is to have regard to the overall financial situation of the person operating the farm.
(6A) If:
(a) section 1129 applies to a person; and
(b) the person, or the person's partner, owns residential premises; and
(c) the premises are an unrealisable asset; and
(d) a family member of the person, or of the partner, lives at the premises; and
(e) one of the following conditions is satisfied:
(i) the family member previously provided substantial care for the person or the partner at the premises at a time when the premises were the principal home of the person or the partner;
(ii) the family member has resided at the premises for a period of, or periods that add up to, 10 years or more;
(iii) the family member is:
(A) a child of the person or the partner; and
(B) disabled;
and the person or the partner is promoting the independent living of the family member; and
(f) it is not reasonable to expect the premises to be sold or otherwise used to provide income support for the person;
the Secretary, in working out the amount per year that could reasonably be expected to be obtained from a purely commercial application of the premises, is to have regard to whether the family member is financially capable of obtaining suitable alternative accommodation.
Note: For family member see subsection 23(1).
(7) Subsections (6) and (6A) do not limit the matters to which the Secretary may have regard in exercising the powers under paragraph (5)(b).
(8) Subsection (2) applies:
(a) subject to subsection (10); and
(b) despite section 1064.
(9) If:
(a) a person has disposed of assets and section 1125, 1126, 1126AA, 1126AB, 1126AC, 1126AD or 1126E (so far as section 1126E relates to section 1126AA, 1126AB, 1126AC or 1126AD) applies to the disposition; and
(b) the Secretary has made a determination under subparagraph 1129(1)(b)(ii) in relation to the disposition;
this section applies to the person as if the person had not disposed of the assets.
(10) If the sum of the rate of pension that would, apart from this subsection, be payable to a person and the annual rate of ordinary income of the person exceeds the maximum payment rate, the rate so payable is to be reduced by the amount per annum of the excess.