# How are Income & Assets calculated?

The summary below of the formula is based on information provided by the Commonwealth

No liability is accepted for its accuracy

Residents / Family Members are encouraged to seek qualified, professional financial advice, use the myagedcare website, or discuss their financial affairs and obtain estimate of fees & charges payable from the myagedcare helpline

## Calculation of Assessable Income (Income Test)

• refer to the 'Residential Fee Estimator' guide on the myagedcare website, for details regarding 'income'

• rates are current as at 1st January 2019 respectively

• the 'income free' threshold is \$26,985.40 [single]; and \$26,465.40 [couple]

• therefore -

• total annual income from defined sources

• less \$26,985.40 assessment free threshold

• = net assessable income

• if the net assessable income is less than \$26,985.40, no income tested amount is payable

• if the net assessable income is greater than \$26,985.40, an income tested amount will be determined/payable by -

• using 50% of the result, and

• dividing by 365 days = daily assessed amount

## Calculation of Assessable Assets (Asset Test)

• refer to the 'Residential Fee Estimator' guide on the myagedcare website, for details regarding 'assets', which comprises two  categories, property and investments [however styled]

• rates are current as at 1st January 2019

• calculation of the Asset Tested Amount applies three  thresholds and three  different interest rates

• the 'asset free' threshold is \$49,000

• the value of the 'family home' [as distinct from any investment property] is deemed to be \$166,707.20 irrespective of the 'market' value, and will only be included in the asset test if not occupied by a 'protected' person [spouse/carer - refer definition on the myagedcare website]

• that amount plus any investments, constitutes the total amount of assets for calculation of the asset test

• the following 'formula' is applied -

• \$166,707.20 less \$49,000 [asset tested free threshold] multiplied by 17.5%

• if the total value of assets exceeds the value of the two  which would apply with respect to the market value of most properties in the inner suburbs, a further threshold is then calculated by deducting the 1st threshold amount of \$166,707.20 from the 2nd threshold of \$402,121.60, multiplied by 1%

• finally the 2nd threshold of \$402,121.60 is deducted from the total value of all assets, multiplied by 2%

• the result of the above calculations is added up to arrive at the Asset Tested Amount

• the Income Tested Amount and the Asset Tested Amount are then added together to arrive at the 'gross' Means Tested Amount payable

• however, as the Commonwealth would contribute a maximum Accommodation Supplement [currently \$56.59], that is deducted from the total Means Tested Amount [Income & Asset], to finally arrive at the Daily Means Tested Care Fee as a contribution to care