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Strategy Overview There is a two year general exemption that applies to your former home after entering aged care whereby the home is exempt from the assets test when calculating Age Pension entitlements. The purpose of this rule is to enable people to move back into their former home if they are able to do so. Any rental income received is fully assessable. After two years, the property will be included as an assessable asset and your pension will be assessed on the basis of a non-homeowner which provides a higher asset threshold. When calculating the aged care means tested amount, the former home value will be assessed up to a capped value of $171,535.20 unless a ‘protected person’[1] resides in the home, in which case the value of the home is exempt. A protected person includes: Your spouse or de-facto partner A carer who has resided in the home for at least 2 years who is eligible to receive an income support payment A close relative who has resided in the home for at least 5 years who is eligible to receive an income support payment Rental income from the former home will be included in the aged care
