Family Home - Clarification re 2 Year Test and Cap - Do exemptions Apply?

Hi. I’m new to this forum and was hoping for some clarification.
My Dad entered aged care in October 2016. Mum continued to live in the family home until she died shortly afterwards (end 2016).
No RAD was paid as it was fully supported. He pays a daily accommodation payment (albeit small).
The house is fully owned by Dad after Mum passed away and is currently valued around $1m. Dad is receiving the full aged pension and has no other assets or income. There is no protected person living in the home.
There has been quite a bit said about the 2 year exemption and capped house value.
I’m very confused and hoping that I can have some clarity about:

  1. whether the house will be counted as an asset or is it exempt?
  2. If it is an asset, what will it affect? Age pension, and what else?
    Thank you

Hi confused101,My understanding is that once a 'protected person" is no longer living in the family home and the home owner decides to keep the home it will be included in the assets test to the capped value of $168,351.20 (as at 20 March 2019). If they sell the family home it will be assessed at the full value. For a resident entering an aged care home after 1 January 2016 if they rent out the home then the rental income will be included in the assets test. As of 1 January 2017 the rental income exemption ceased to apply to the age pension. It also says on the government website (cited below) that the 2 year exemption applies to the person in the care situation from the date of their partner’s death which would mean from the information you provided about your parents situation that would have expired at the end of 2018. On the government website they also discuss other exemptions so may be worth reading to see if that is relevant to your father’s situation. When a person’s assets change it can potentially impact ono the resident’s mean tested fee and age pension. My understanding is that for a person to be “fully supported” in an aged care home they have to have assets less than $49,500. This means they only pay the basic daily fee of $51.20 per day. For these reasons I would suggest you call Department Human Services Income and Assets line on 1800 227 475 to clarify your father’s situation. We at agecare101 are not permitted to give financial advice and given the often confusing nature of aged care finances we always strongly recommend that people seek specialist financial advice to ensure the best result. Reg