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FINANCIAL CARE SERVICES
Independent aged care, lifestyle and financial advice for seniors
Volume 4 Edition 6 – 24 June 2014

Hello

The end of the financial year is near

Financial year end gifting to be banked before Monday 30 June

Gifting can be a pleasure for both the donor and the gift recipient. Gifts generally reduce the asset base of the donor. Some gifts also reduce the ‘assets’ of a Centrelink or DVA Pensioner. The ATO allows for gifts to some charitable causes to be deducted from your ‘taxable income’. Careful attention to the effective date of any gift could maximise the donor’s ‘benefit’ from gifting.

If you are still in the paper based world then your cheque needs to be banked by your preferred charity no later than next Friday, 27 June. If you operate in the electronic era then your payment with the attached identifier needs to completed before the cut-off for business on Friday 27 June.
Cheque deposits and electronic banking transaction completed on 27 June will appear in the bank statement on 30 June so your receipt could be issued for the 2013/14 financial year.

Financial year end gifting for DVA and Centrelink Pensioners

The gifting year for DVA and Centrelink Pensioners is the Commonwealth government financial year, that is, from 1 July to the next 30 June.

Centrelink and DVA Pensioners may gift up to $10,000 per financial year to a maximum of $30,000 over any five year period without incurring a penalty. Any amounts gifted in excess of these limits is counted as an additional ‘financial asset’ of the Pensioner for five years after the date of the ‘excess gift’.

Why be concerned about financial year end gifting?

Any gifts that you make now could impact on the means tested fees that you, or your partner, could be charged for residential aged care during the next five years. Whilst aged care might not be in your plans, an accident or stroke could derail your plans.
Read more about Financial year end gifting

SMSF annual returns are another feature of the end of the financial year

When a member of an SMSF becomes frail or demented and enters residential aged care then his Attorney must sign up as a trustee of the SMSF.
The end of financial year reporting season could be a good time for the Attorney to review the SMSF and consider the winding up process. Read more about the duties of an Attorney or Administrator for a  SMSF member who enters aged care.

On 30 June 2014 an era of aged care Accommodation Charges, Bonds and Income tested fees closes to new entrants.

Permanent residents who entered High Care directly before 30 June 2014 will continue to pay Accommodation Charges at the rate agreed on entry to that facility. Moving to another aged care facility could require a new aged care agreement with a different aged care provider. A change of aged care provider could result in a changeover to the new system of fees and charges for residential aged care.

A new system of fees and charges for residential aged care starts 1 July 2014

The new system has new labels and new means testing formulae. The really new element is the cap on the amounts that a resident could pay in a year and over a lifetime. The actual cost of residential aged care could be less under the new system for some residents. The new means testing and fee caps for aged care could ease the financial burden on the resident’s spouse who is still active in the workforce.

Financial Care Services is prepared for the new system of fees and charges.
For advice regarding your particular circumstances, call Christine for an appointment.

A consultation before placing a loved one into permanent care could clarify the costs and check that the place is affordable before permanent entry is confirmed. Call Financial Care Services on 9808 0338 to book a consultation before you finalize an aged care placement.

Help is available. Financial Care Services offers consultation with families to Illustrate the financial implications of their choices of aged care placements.

Call Christine on 03 9808 0338 to book an appointment to discuss your aged care financing.

Christine Hopper

Director
Financial Care Services Pty Ltd
Independent aged care, lifestyle and financial advice for seniors in Melbourne, Victoria, Australia
Australian Financial Services Licence Number
299570 (check this at www.search.asic.gov.au/fsr/flb.html)
Authorised Representative Number
252529 (check this at www.search.asic.gov.au/fsr/far.html)

Telephone – call +61 3 9808 0338
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Disclaimer: The information contained in this newsletter is of a general nature only and does not constitute “financial advice”. You should obtain your own personal financial advice before investing any money or moving in to any retirement village, lifestyle community or aged care facility. Financial Care Services is licensed to provide financial advice to individual clients based on their personal situations.

Financial Care Services does not provide taxation advice or superannuation administration services. You should seek SMSF audit services from an appropriately registered auditor.
© 2014 Financial Care Services Pty Ltd. All rights reserved.