Increase pension
gifting limits
Raising Age Pension gifting limits will encourage older Australians to contribute financially to younger generations.
What are we calling for?
The Age Pension gifting limit should be increased to reflect inflation to encourage older people to give money to future generations.
This will assist younger generations with the costs of purchasing a home, health care or education (e.g., HECS debt).
Why increase gifting limits?
Older people care about future generations. A recent National Seniors poll showed that 87% have already, or would, consider gifting money to purchase a first home.
However, the act of gifting has real impacts on older people’s living costs, diminishing their ability to generate income to meet current and future living costs.
Under social security law, gifting is defined as the act of giving away income or assets; or selling something for less than the value it is worth. Under gifting rules, income or assets given away may still count towards the income and assets tests.
This acts as a disincentive to give money to younger generations because an older person will have less savings from which to generate income and fund living costs.
The limit someone can gift without it running afoul of gifting rules is $10,000 per financial year. The limit of $10,000 was set in July 2002. Yet, inflation has increased on average by 2.6% per annum since this time.
While assets test thresholds are indexed in line with inflation each year (in July), gifting limits haven’t changed at all!
Based on average inflation, the gifting limit in 2023 should be about $16,500.
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Aged care
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