I remember reading about Testimentary Trusts some time ago. That they increase a person’s annual income, but without being penalised by Centrelink.
Which got me thinking… When placing cash into trusts for family members… Is it possible to put cash into a trust in such a way that Centrelink will not penalise them, BUT they can still access large sums of money – for instance to purchase a property?
I had a look at Centrelink’s policies a while back for my grandfather. It seems they will count trust assets as being your own if you control a trust (or company). They define control broadly to include ebing an appointor, trustee, director of trustee etc. And receiving a distribution would possibly also fall in here.
So they have it pretty much covered.
I think there is a bit on centrelink and trusts here. http://www.taxlawyer.com.au
One possible solution is to keep the pensioners clear of trusts and to have any trust controlled by younger family members – who can then spend their money as they see fit.
Terryw
Discover Home Loans
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