As the 1 July changes to superannuation contribution rules come into effect, advisers with older clients should be aware of the strategy options these and other legislative changes could offer for aged care, Aged Care Steps has said.
The changes would allow clients moving into residential care who decide to sell their homes to potentially take care of downsizer contributions for estate planning purposes.
Director of Aged Care Steps, Assyat David, said that advisers needed to both be aware of legislative changes that could impact clients’ aged care plans and have the tools needed to keep up to date these.
“Legislation is subject to constant change and new opportunities arise as a result. Even changes that are not directly related to aged care could create new strategy options for aged care,” David said.
“Further changes to aged care legislation and the impact on Centrelink/DVA entitlements can be expected as the Government deals with the increasing need for care by older Australians and the rising costs of subsidising care services. This is likely to result in changes to increase client contributions,” he predicted.
The implications of such legislation should be assessed in light of clients’ full circumstances and the interaction between aged care, Centrelink and taxation to meet the best interests duty.
David warned that advisers needed to make sure their calculations, software, marketing and other tools were constantly revised to keep abreast of the regular changes to aged care legislation and related strategies.
“Otherwise, advisers risk providing inaccurate and inappropriate advice to clients.”