Social Security and Veterans’ Entitlements Legislation Amendment (Disposal of Assets—Integrity of Means Testing) Act 2002
No. 54, 2002
An Act to amend the Social Security Act 1991 and the Veterans’ Entitlements Act 1986 in relation to the effect on social security and veterans’ benefits of the disposal of assets, and for related purposes
Contents
1 Short title...................................
2 Commencement...............................
3 Schedule(s)..................................
Schedule 1—Social Security Act 1991
Schedule 2—Veterans’ Entitlements Act 1986
Social Security and Veterans’ Entitlements Legislation Amendment (Disposal of Assets—Integrity of Means Testing) Act 2002
No. 54, 2002
An Act to amend the Social Security Act 1991 and the Veterans’ Entitlements Act 1986 in relation to the effect on social security and veterans’ benefits of the disposal of assets, and for related purposes
[Assented to 29 June 2002]
The Parliament of Australia enacts:
1 Short title
This Act may be cited as the Social Security and Veterans’ Entitlements Legislation Amendment (Disposal of Assets—Integrity of Means Testing) Act 2002.
2 Commencement
This Act commences, or is taken to have commenced, on 1 July 2002.
3 Schedule(s)
Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.
Schedule 1—Social Security Act 1991
1 After subsection 23(1)
Insert:
(1A) Where:
(a) a provision of this Act refers to:
(i) the greater or greatest, or the higher or highest; or
(ii) the lesser or least, or the lower or lowest;
of 2 or more amounts; and
(b) the amounts are equal;
the provision is taken to refer to one only of the amounts.
(1B) Where:
(a) a provision of this Act refers to the greatest or highest of 3 or more amounts; and
(b) 2 or more (but not all) of the amounts are equal and exceed the other amount or other amounts;
the provision is taken to refer to one only of those equal amounts.
(1C) Where:
(a) a provision of this Act refers to the least or lowest of 3 or more amounts; and
(b) 2 or more (but not all) of the amounts are equal and are less than the other amount or other amounts;
the provision is taken to refer to one only of those equal amounts.
2 Paragraph 9(4)(b)
Omit “or 1126”, substitute “, 1126, 1126AA, 1126AB, 1126AC or 1126AD”.
3 Subsection 11(1)
Insert:
income year has the same meaning as in the Income Tax Assessment Act 1997.
4 After subsection 11(10)
Insert:
No pension year to extend beyond 30 June 2002
(10AAA) No period after 30 June 2002 is, or is a part of, a pension year of a person. If, apart from this subsection, a period beginning before 1 July 2002 and ending on or after that date would be a pension year of a person, the part of that period that ends immediately before that date is taken to be a pension year of the person.
5 After subsection 11(10A)
Insert:
No pre‑pension year to extend beyond 30 June 2002
(10B) No period after 30 June 2002 is, or is a part of, a pre‑pension year of a person. If, apart from this subsection, a period beginning before 1 July 2002 and ending on or after that date would be a pre‑pension year of a person, the part of that period that ends immediately before that date is taken to be a pre‑pension year of the person.
6 Section 92B (at the end of the definition of disposal preclusion period)
Add “or 93UA”.
7 Before subsection 93U(1)
Insert:
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
Note: The heading to section 93U is replaced by the heading “Disposal preclusion period—disposals before 1 July 2002”.
8 After section 93U
Insert:
93UA Disposal preclusion period—disposals on or after 1 July 2002
A person is subject to a disposal preclusion period throughout any period for which an amount is included in the value of the person’s assets under section 1126AA, 1126AB, 1126AC or 1126AD.
9 After subsection 198H(1)
Insert:
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
10 After subsection 198HA(1)
Insert:
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
11 After subsection 198HB(1)
Insert:
Disposals before 1 July 2002
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
12 After subsection 198J(1)
Insert:
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
Note: The heading to section 198J is replaced by the heading “Disposal of assets before 1 July 2002—individual higher ADAT score adults”.
13 After subsection 198JA(1)
Insert:
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
Note: The heading to section 198JA is replaced by the heading “Disposal of assets before 1 July 2002—profoundly disabled children or disabled children”.
14 After subsection 198JB(1)
Insert:
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
Note: The heading to section 198JB is replaced by the heading “Disposal of assets before 1 July 2002—lower ADAT score adult and dependent child”.
15 After section 198JB
Insert:
198JC Disposal of assets in income year—individual higher ADAT score adults
Application
(1) This section has effect in determining whether a person (the carer) who has been receiving a carer payment for caring for a care receiver who:
(a) is a higher ADAT score adult; and
(b) is not a member of a couple;
continues to qualify for the payment.
Disposals to which section applies
(2) This section applies to a disposal (the relevant disposal) on or after 1 July 2002 by the care receiver of an asset of the care receiver.
Increase in value of assets of higher ADAT score adult
(3) If the amount of the relevant disposal, or the sum of that amount and the amounts (if any) of other disposals of assets previously made by the care receiver during the income year in which the relevant disposal took place, exceeds $10,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the care receiver’s assets for the period of 5 years starting on the day on which the relevant disposal took place:
(a) the amount of the relevant disposal;
(b) the amount by which the sum of the amount of the relevant disposal, and the amounts (if any) of other disposals of assets previously made by the care receiver during the income year in which the relevant disposal took place, exceeds $10,000.
198JD Disposal of assets in 5 year period—individual higher ADAT score adults
Application
(1) This section also has effect in determining whether a person (the carer) who has been receiving a carer payment for caring for a care receiver who:
(a) is a higher ADAT score adult; and
(b) is not a member of a couple;
continues to qualify for the payment.
Disposals to which section applies
(2) This section applies to a disposal (the relevant disposal) on or after 1 July 2002 by the care receiver of an asset of the care receiver.
Increase in value of assets of higher ADAT score adult
(3) If:
(a) the sum of the amount of the relevant disposal and the amounts of any previous disposals during the rolling period by the care receiver of assets of the care receiver;
less
(b) the sum of any amounts included in the value of the care receiver’s assets during the rolling period under section 198JC or any previous application or applications of this section;
exceeds $30,000, then, for the purposes of this Act, an amount equal to the excess is to be included in the value of the care receiver’s assets for the period of 5 years starting on the day on which the relevant disposal took place.
Rolling period
(4) For the purposes of this section, the rolling period is the period comprising the income year in which the relevant disposal took place and such (if any) of the 4 previous income years as occurred after 30 June 2002.
198JE Disposal of assets in income year—profoundly disabled children
Application
(1) This section has effect in determining whether a person who has been receiving a carer payment for caring for a care receiver who is a profoundly disabled child continues to qualify for the payment.
Disposals to which section applies
(2) This section applies to a disposal (the relevant disposal) on or after 1 July 2002 by a person of one or more of the disabled child’s assets.
Increase in value of assets of profoundly disabled child
(3) If the amount of the relevant disposal, or the sum of that amount and the amounts (if any) of other disposals of the disabled child’s assets previously made by a person during the income year in which the relevant disposal took place, exceeds $10,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the disabled child’s assets for the period of 5 years starting on the day on which the relevant disposal took place:
(a) the amount of the relevant disposal;
(b) the amount by which the sum of the amount of the relevant disposal, and the amounts (if any) of other disposals of the disabled child’s assets previously made during the income year in which the relevant disposal took place, exceeds $10,000.
198JF Disposal of assets in 5 year period—profoundly disabled children
Application
(1) This section also has effect in determining whether a person who has been receiving a carer payment for caring for a care receiver who is a profoundly disabled child continues to qualify for the payment.
Disposals to which section applies
(2) This section applies to a disposal (the relevant disposal) on or after 1 July 2002 by a person of one or more of the disabled child’s assets.
Increase in value of assets of profoundly disabled child
(3) If:
(a) the sum of the amount of the relevant disposal and the amounts of any previous disposals during the rolling period by a person of any of the disabled child’s assets;
less
(b) the sum of any amounts included in the value of the disabled child’s assets during the rolling period under section 198JE or any previous application or applications of this section;
exceeds $30,000, then, for the purposes of this Act, an amount equal to the excess is to be included in the value of the disabled child’s assets for the period of 5 years starting on the day on which the relevant disposal took place.
Rolling period
(4) For the purposes of this section, the rolling period is the period comprising the income year in which the relevant disposal took place and such (if any) of the 4 previous income years as occurred after 30 June 2002.
198JG Disposal of assets in income year—lower ADAT score adult and dependent child
Application
(1) This section has effect in determining whether a person (the carer) who has been receiving a carer payment for caring for care receivers who are a lower ADAT score adult and a dependent child continues to qualify for the payment.
Disposals to which section applies
(2) This section applies to a disposal (the relevant disposal) on or after 1 July 2002 of an asset of any of the following persons (each of whom is called a qualifying person):
(a) the lower ADAT score adult;
(b) the dependent child;
(c) if the adult is a member of a couple—the adult’s partner and any FTB child of the adult or of the partner;
(d) if the adult is not a member of a couple—any FTB child of the adult.
Increase in value of assets of lower ADAT score adult
(3) Subject to subsection (4), if the amount of the relevant disposal, or the sum of that amount and the amounts (if any) of other disposals of assets of any of the qualifying persons previously made during the income year in which the relevant disposal took place, exceeds $10,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the assets of the lower ADAT score adult for the period of 5 years starting on the day on which the relevant disposal took place:
(a) the amount of the relevant disposal;
(b) the amount by which the sum of the amount of the relevant disposal and the amounts (if any) of other disposals of assets of the qualifying persons previously made during the income year in which the relevant disposal took place, exceeds $10,000.
Effect of ceasing to be member of couple or death of FTB child after disposal of assets
(4) If:
(a) an amount is included under subsection (3) in the value of the assets of the lower ADAT score adult because of the relevant disposal; and
(b) if the lower ADAT score adult is a member of a couple—either:
(i) the adult ceases to be a member of that couple (either because his or her partner dies or for another reason); or
(ii) any of the FTB children dies; and
(c) if the lower ADAT score adult is not a member of a couple—any of the FTB children dies;
then, for the purposes of subsection (3), the following are to be disregarded:
(d) in a subparagraph (b)(i) case—the partner and any FTB child of the partner and any disposal of their assets; or
(e) in a subparagraph (b)(ii) or paragraph (c) case—the FTB child and any disposal of his or her assets.
198JH Disposal of assets in 5 year period—lower ADAT score adult and dependent child
Application
(1) This section also has effect in determining whether a person (the carer) who has been receiving a carer payment for caring for care receivers who are a lower ADAT score adult and a dependent child continues to qualify for the payment.
Disposals to which section applies
(2) This section applies to a disposal (the relevant disposal) on or after 1 July 2002 of an asset of any of the following persons (each of whom is called a qualifying person):
(a) the lower ADAT score adult;
(b) the dependent child;
(c) if the adult is a member of a couple—the adult’s partner and any FTB child of the adult or of the partner;
(d) if the adult is not a member of a couple—any FTB child of the adult.
Increase in value of assets of lower ADAT score adult
(3) Subject to subsection (4), if:
(a) the sum of the amount of the relevant disposal and the amounts of any previous disposals during the rolling period of assets of any of the qualifying persons;
less
(b) the sum of any amounts included in the value of the assets of the lower ADAT score adult during the rolling period under section 198JG or any previous application or applications of this section;
exceeds $30,000, then, for the purposes of this Act, an amount equal to the excess is to be included in the value of the assets of the lower of the ADAT score adult for the period of 5 years starting on the day on which the relevant disposal took place.
Effect of ceasing to be member of couple or death of FTB child after disposal of assets
(4) If:
(a) an amount is included under subsection (3) in the value of the assets of the lower ADAT score adult because of the relevant disposal; and
(b) if the lower ADAT score adult is a member of a couple—either:
(i) the adult ceases to be a member of that couple (either because his or her partner dies or for another reason); or
(ii) any of the FTB children dies; and
(c) if the lower ADAT score adult is not a member of a couple—any of the FTB children dies;
then, for the purposes of subsection (3), the following are to be disregarded:
(d) in a subparagraph (b)(i) case—the partner and any FTB child of the partner and any disposal of their assets; or
(e) in a subparagraph (b)(ii) or paragraph (c) case—the FTB child and any disposal of his or her assets.
Rolling period
(5) For the purposes of this section, the rolling period is the period comprising the income year in which the relevant disposal took place and such (if any) of the 4 previous income years as occurred after 30 June 2002.
16 After subsection 198K(1)
Insert:
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
17 After subsection 198L(1)
Insert:
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
Note: The heading to section 198L is replaced by the heading “Disposal of assets before 1 July 2002—members of couples including higher ADAT score adults”.
18 After section 198L
Insert:
198LA Disposal of assets in income year—members of couples including higher ADAT score adults
Application
(1) This section has effect in determining whether a person (the carer) who has been receiving a carer payment for caring for a care receiver who is a higher ADAT score adult and is a member of a couple continues to qualify for the payment.
Disposals to which section applies
(2) This section applies to a disposal (the relevant disposal) on or after 1 July 2002 of an asset by the care receiver, the care receiver’s partner, or the care receiver and the care receiver’s partner.
Increase in value of assets
(3) If the amount of the relevant disposal, or the sum of that amount and the amounts (if any) of other disposals of assets previously made by the care receiver, the care receiver’s partner, or the care receiver and the care receiver’s partner (whether before or after they became members of the couple), during the income year in which the relevant disposal took place, exceeds $10,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the assets of the care receiver and in the value of the assets of the partner for the period of 5 years starting on the day on which the relevant disposal took place:
(a) one‑half of the amount of the relevant disposal;
(b) one‑half of the amount by which the sum of the amount of the relevant disposal and the amounts (if any) of other disposals of assets previously made by the care receiver, the partner, or the care receiver and the partner, during the income year in which the relevant disposal took place, exceeds $10,000.
Effect of ceasing to be a member of couple after disposal by care receiver
(4) If:
(a) the relevant disposal is the disposal of an asset by the care receiver; and
(b) after the relevant disposal, the care receiver and the care receiver’s partner cease to be members of the same couple (either because the partner dies or for another reason);
the amount that was included in the value of the assets of the partner because of the relevant disposal is to be included in the value of the assets of the care receiver.
Effect of ceasing to be a member of couple after disposal by care receiver’s partner
(5) If:
(a) the relevant disposal is the disposal of an asset by the care receiver’s partner; and
(b) after the relevant disposal, the care receiver and the partner cease to be members of the same couple (either because the partner dies or for another reason);
the amount that was included in the value of the assets of the care receiver because of the relevant disposal is no longer to be included in the value of the assets of the care receiver.
198LB Disposal of assets in 5 year period—members of couples including higher ADAT score adults
Application
(1) This section also has effect in determining whether a person (the carer) who has been receiving a carer payment for caring for a care receiver who is a higher ADAT score adult and is a member of a couple continues to qualify for the payment.
Disposals to which section applies
(2) This section applies to a disposal (the relevant disposal) on or after 1 July 2002 of an asset by the care receiver, the care receiver’s partner, or the care receiver and the care receiver’s partner.
Increase in value of assets
(3) If:
(a) the sum of the amount of the relevant disposal and the amounts of any previous disposals during the rolling period of assets by the care receiver, the care receiver’s partner, or the care receiver and the care receiver’s partner;
less
(b) the sum of any amounts included in the value of the assets of the care receiver or the partner during the rolling period under a provision of this Subdivision other than this section or under any previous application or applications of this section;
exceeds $30,000, then, for the purposes of this Act, an amount equal to one‑half of the excess is to be included in the value of the assets of the care receiver and in the value of the assets of the partner for the period of 5 years starting on the day on which the relevant disposal took place.
Effect of ceasing to be member of couple after disposal by care receiver
(4) If:
(a) the relevant disposal is a disposal of an asset by the care receiver; and
(b) after the relevant disposal, the care receiver and the care receiver’s partner cease to be members of the same couple (either because the partner dies or for another reason);
the amount that was included in the value of the assets of the partner because of the relevant disposal is to be included in the value of the assets of the care receiver.
Effect of ceasing to be member of couple after disposal by care receiver’s partner
(5) If:
(a) the relevant disposal is a disposal of an asset by the care receiver’s partner; and
(b) after the relevant disposal, the care receiver and the partner cease to be members of the same couple (either because the partner dies or for another reason);
the amount that was included in the value of the assets of the care receiver because of the relevant disposal is no longer to be included in the value of the assets of the care receiver.
Rolling period
(6) For the purposes of this section, the rolling period is the period comprising the income year in which the relevant disposal took place and such (if any) of the 4 previous income years as occurred after 30 June 2002.
19 Paragraph 1110(1)(a)
After “person” (last occurring), insert “before 1 July 2002”.
Note: The heading to section 1110 is altered by inserting “before 1 July 2002” after “transactions”.
20 Section 1124
After “amount of the”, insert “disposal or”.
Note: The heading to section 1124 is replaced by the heading “Amount of disposal or disposition”.
21 Before subsection 1124A(1)
Insert:
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
22 Subsection 1125(1)
After “1986”, insert “and before 1 July 2002”.
Note: The heading to section 1125 is replaced by the heading “Disposal of assets in pension years—individuals”.
23 Before subsection 1125A(1)
Insert:
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
24 Subsection 1126(1)
After “1986”, insert “and before 1 July 2002”.
Note: The heading to section 1126 is replaced by the heading “Disposal of assets in pension years—members of couples”.
25 After section 1126
Insert:
1126AA Disposal of assets in income year—individuals
Disposals to which section applies
(1) This section applies to a disposal (the relevant disposal) on or after 1 July 2002 of an asset by a person who is not a member of a couple at the time of the relevant disposal.
Increase in value of assets
(2) If the amount of the relevant disposal, or the sum of that amount and the amounts (if any) of other disposals of assets previously made by the person during the income year in which the relevant disposal took place, exceeds $10,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the person’s assets for the period of 5 years starting on the day on which the relevant disposal took place:
(a) the amount of the relevant disposal;
(b) the amount by which the sum of the amount of the relevant disposal and the amounts (if any) of other disposals of assets previously made by the person during the income year in which the relevant disposal took place, exceeds $10,000.
Previous joint disposals
(3) If, during the income year in which the relevant disposal took place but before the time of the relevant disposal, the person was a member of a couple who jointly disposed of an asset, a reference in subsection (2) to the amounts (if any) of other disposals of assets previously made by the person during that income year includes a reference to one‑half of the amount of the joint disposal.
1126AB Disposals of assets in 5 year period—individuals
Disposal to which section applies
(1) This section also applies to a disposal (the relevant disposal) on or after 1 July 2002 of an asset by a person who is not a member of a couple at the time of the relevant disposal.
Increase in value of assets
(2) If:
(a) the sum of the amount of the relevant disposal and the amounts of any previous disposals of assets made during the rolling period by the person;
less
(b) the sum of any amounts included in the value of the person’s assets during the rolling period under section 1126AA, 1126AC or 1126AD or any previous application or applications of this section;
exceeds $30,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the person’s assets for the period of 5 years starting on the day on which the relevant disposal took place:
(c) an amount equal to the excess;
(d) the amount of the relevant disposal.
Previous joint disposals
(3) If, during the rolling period but before the time of the relevant disposal, the person was a member of a couple who jointly disposed of an asset, the reference in paragraph (2)(a) to the amounts of any previous disposals of assets made during the rolling period by the person includes a reference to one‑half of the amount of the joint disposal.
Rolling period
(4) For the purposes of this section, the rolling period is the period comprising the income year in which the relevant disposal took place and such (if any) of the 4 previous income years as occurred after 30 June 2002.
1126AC Disposal of assets in income year—members of couples
Disposals to which section applies
(1) If there is a disposal (the relevant disposal) on or after 1 July 2002 of an asset by:
(a) a person who, at the time of the relevant disposal, is a member of a couple; or
(b) the person referred to in paragraph (a) and the person who is, at that time, the partner of the person referred to in that paragraph;
subsection (2) has effect.
Increase in value of assets
(2) Subject to this section, if the amount of the relevant disposal, or the sum of that amount and the amounts (if any) of other disposals of assets previously made by the person, the person’s partner, or the person and the person’s partner, during the income year in which the relevant disposal took place (whether before or after they became members of the couple), exceeds $10,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the assets of the person and in the value of the assets of the partner for the period of 5 years starting on the day on which the relevant disposal took place:
(a) one‑half of the amount of the relevant disposal;
(b) one‑half of the amount by which the sum of the amount of the relevant disposal, and the amounts (if any) of other disposals of assets previously made by the person, the partner, or the person and the partner, during the income year in which the relevant disposal took place, exceeds $10,000.
Effect of ceasing to be member of couple
(3) If, after the disposal referred to in paragraph (1)(a), the person and the person’s partner cease to be members of the same couple:
(a) no amount is to be included after the cessation in the value of the assets of the former partner because of that disposal; and
(b) any amount that would, apart from this subsection, have been so included is to be included in the value of the assets of the person.
Effect of death of person
(4) If, after the disposal referred to in paragraph (1)(a), the person dies, no amount is to be included in the value of the assets of the person’s partner because of that disposal.
Effect of death of partner
(5) If, after the disposal referred to in paragraph (1)(a), the person’s partner dies, any amount that, if the partner had not died, would have been included in the value of the assets of the partner because of that disposal is to be included in the value of the assets of the person.
1126AD Disposal of assets in 5 year period—members of couples
Disposals to which section applies
(1) If there is a disposal (the relevant disposal) on or after 1 July 2002 of an asset by:
(a) a person who, at the time of the relevant disposal, is a member of a couple; or
(b) the person referred to in paragraph (a) and the person who is, at that time, the partner of the person referred to in that paragraph;
subsection (2) has effect.
Increase in value of assets
(2) Subject to this section, if:
(a) the sum of the amount of the relevant disposal and the amounts of any previous disposals of assets made during the rolling period by the person, the person’s partner or the person and the person’s partner;
less
(b) the sum of any amounts included in the value of the assets of the person or of the partner during the rolling period under section 1126AA, 1126AB or 1126AC or any previous application or applications of this section;
exceeds $30,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the assets of the person and in the value of the assets of the partner for the period of 5 years starting on the day on which the relevant disposal took place:
(c) an amount equal to one‑half of the excess;
(d) one‑half of the amount of the relevant disposal.
Effect of ceasing to be member of couple
(3) If, after the disposal referred to in paragraph (1)(a), the person and the person’s partner cease to be members of the same couple:
(a) no amount is to be included after the cessation in the value of the assets of the former partner because of that disposal; and
(b) any amount that would, apart from this subsection, have been so included is to be included in the value of the assets of the person.
Effect of death of person
(4) If, after the disposal referred to in paragraph (1)(a), the person dies, no amount is to be included in the value of the assets of the person’s partner because of that disposal.
Effect of death of partner
(5) If, after the disposal referred to in paragraph (1)(a), the person’s partner dies, any amount that, if the partner had not died, would have been included in the value of the assets of the partner because of that disposal is to be included in the value of the assets of the person.
Rolling period
(6) For the purposes of this section, the rolling period is the period comprising the income year in which the relevant disposal took place and such (if any) of the 4 previous income years as occurred after 30 June 2002.
26 Before subsection 1126A(1)
Insert:
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
27 Before subsection 1126B(1)
Insert:
(1A) This section applies only to disposals of assets that took place before 1 July 2002.
28 After section 1126B
Insert:
1126C Disposal of assets in income year—family members
Disposals to which section applies
(1) This section applies to a disposal (the relevant disposal) on or after 1 July 2002 of an asset by a person (the relevant person) who is a family member of another person (the other person) who has claimed or is receiving a youth allowance.
Increase in value of assets
(2) Subject to this section, if the amount of the relevant disposal, or the sum of that amount and the amounts (if any) of other disposals of assets previously made by the relevant person or the other person during the income year in which the relevant disposal took place, exceeds $10,000, then, for the purpose of determining whether a youth allowance is payable to the other person, the lesser of the following amounts is to be included in the value of the other person’s assets for the period of 5 years starting on the day on which the relevant disposal took place:
(a) the amount of the relevant disposal;
(b) the amount by which the sum of the amount of the relevant disposal, and the amounts (if any) of other disposals of assets previously made by the relevant person or the other person during the income year in which the relevant disposal took place, exceeds $10,000.
Effect of ceasing to be family member
(3) If:
(a) an amount is included under subsection (2) in the value of the other person’s assets because of a disposal of an asset by the relevant person; and
(b) the relevant person ceases to be a family member of the other person;
any amount that was included in the value of those assets because of the disposal ceases to be included in the value of those assets.
Effect of death
(4) If:
(a) an amount is included under subsection (2) in the value of the other person’s assets because of a disposal of an asset by the relevant person; and
(b) the relevant person dies;
any amount that was included in the value of those assets because of the disposal ceases to be included in the value of those assets.
1126D Disposals of assets in 5 year period—family members
Disposals to which section applies
(1) This section applies to a disposal (the relevant disposal) on or after 1 July 2002 of an asset by a person (the relevant person) who is a family member of another person (the other person) who has claimed or is receiving youth allowance.
Increase in value of assets
(2) If:
(a) the amount of the relevant disposal, or the sum of that amount and the amounts (if any) of other disposals of assets made during the rolling period by the relevant person or the other person;
less
(b) the sum of any amounts included in the value of the other person’s assets during the rolling period under section 1126C or any previous application or applications of this section;
exceeds $30,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the other person’s assets for the period of 5 years starting on the day on which the relevant disposal took place:
(c) an amount equal to the excess;
(d) the amount of the relevant disposal.
Effect of ceasing to be family member
(3) If:
(a) amounts are included under subsection (2) in the value of the other person’s assets because of a disposal of an asset by the relevant person; and
(b) the relevant person ceases to be a family member of the other person;
any amount that was included in the value of those assets because of the disposal ceases to be included in the value of those assets.
Effect of death
(4) If:
(a) an amount is included under subsection (2) in the value of the other person’s assets because of a disposal of an asset by the relevant person; and
(b) the relevant person dies;
any amount that was included in the value of those assets because of the disposal ceases to be included in the value of those assets.
Rolling period
(5) For the purposes of this section, the rolling period is the period comprising the income year in which the relevant disposal took place and such (if any) of the 4 previous income years as occurred after 30 June 2002.
29 Subparagraph 1129(1)(b)(i)
Omit “and 1126”, substitute “, 1126, 1126AA, 1126AB, 1126AC and 1126AD”.
30 Paragraph 1130(9)(a)
Omit “or 1126”, substitute “, 1126, 1126AA, 1126AB, 1126AC or 1126AD”.
31 Subparagraph 1130B(1)(c)(i)
Omit “and 1126”, substitute “, 1126, 1126AA, 1126AB, 1126AC and 1126AD”.
32 Paragraph 1130C(8)(a)
Omit “or 1126”, substitute “, 1126, 1126AA, 1126AB, 1126AC or 1126AD”.
33 Subparagraph 1131(1)(d)(i)
Omit “and 1126”, substitute “, 1126, 1126AA, 1126AB, 1126AC and 1126AD”.
34 Paragraph 1132(7)(a)
Omit “or 1126”, substitute “, 1126, 1126AA, 1126AB, 1126AC or 1126AD”.
35 Subsection 1208K(1)
Omit “, section 93U and sections”, substitute “and sections 93U, 93UA and”.
36 Subsection 1208L(1)
Omit “, section 93U and sections”, substitute “and sections 93U, 93UA and”.
37 Section 1208M
Omit “, section 93U and sections”, substitute “and sections 93U, 93UA and”.
38 Paragraphs 1208N(1)(e) and (f)
Omit “, section 93U and sections”, substitute “and sections 93U, 93UA and”.
39 Paragraphs 1208P(1)(e) and (f)
Omit “, section 93U and sections”, substitute “and sections 93U, 93UA and”.
Schedule 2—Veterans’ Entitlements Act 1986
1 Section 5 (Index of definitions)
Insert in their appropriate alphabetical positions, determined on a letter‑by‑letter basis:
greater amount | 5QAA |
greatest amount | 5QAA |
higher amount | 5QAA |
highest amount | 5QAA |
least amount | 5QAA |
lesser amount | 5QAA |
lower amount | 5QAA |
lowest amount | 5QAA |
2 Paragraph 5J(2B)(b)
Omit “section 52FA, 52G, 52GA or 52H”, substitute “Subdivision BA or BB of Division 11 of Part IIIB”.
3 After subsection 5L(9)
Insert:
No pension year to extend beyond 30 June 2002
(9A) No period after 30 June 2002 is, or is a part of, a pension year of a person. If, apart from this subsection, a period beginning before 1 July 2002 and ending on or after that date would be a pension year of a person, the part of that period that ends immediately before that date is taken to be a pension year of the person.
4 After subsection 5L(10A)
Insert:
No pre‑pension year to extend beyond 30 June 2002
(10B) No period after 30 June 2002 is, or is a part of, a pre‑pension year of a person. If, apart from this subsection, a period beginning before 1 July 2002 and ending on or after that date would be a pre‑pension year of a person, the part of that period that ends immediately before that date is taken to be a pre‑pension year of the person.
5 After section 5Q
Insert:
5QAA Equal amounts
(1) Where:
(a) a provision of this Act refers to:
(i) the greater or greatest, or the higher or highest; or
(ii) the lesser or least, or the lower or lowest;
of 2 or more amounts; and
(b) the amounts are equal;
the provision is taken to refer to one only of the amounts.
(2) Where:
(a) a provision of this Act refers to the greatest or highest of 3 or more amounts; and
(b) 2 or more (but not all) of the amounts are equal and exceed the other amount or other amounts;
the provision is taken to refer to one only of those equal amounts.
(3) Where:
(a) a provision of this Act refers to the least or lowest of 3 or more amounts; and
(b) 2 or more (but not all) of the amounts are equal and are less than the other amount or other amounts;
the provision is taken to refer to one only of those equal amounts.
6 Section 45TA (at the end of the definition of disposal preclusion period)
Add “or 45UTA”.
7 Subsection 45TN(1) (note)
Omit “section 45UT”, substitute “sections 45UT and 45UTA”.
8 Subsection 45UM(5)
Omit “Subdivision B of Division 11 of Part IIIB (disposals of assets)”, substitute “Subdivision BA or BB of Division 11 of Part IIIB (dispositions of assets)”.
9 Before subsection 45UT(1)
Insert:
(1A) This section applies only to dispositions of assets that took place before 1 July 2002.
Note: The heading to section 45UT is replaced by the heading “Disposal preclusion period—dispositions before 1 July 2002”.
10 At the end of section 45UT
Add:
(5) No period after 30 June 2002 is, or is a part of, a designated year of a person. If, apart from this subsection, a period beginning before 1 July 2002 and ending on or after that date would be a designated year of a person, the part of that period that ends immediately before that date is taken to be a designated year of the person.
11 After section 45UT
Insert:
45UTA Disposal preclusion period—dispositions on or after 1 July 2002
A person is subject to a disposal preclusion period throughout any period for which an amount is included in the value of the person’s assets under Subdivision BB of Division 11 of Part IIIB.
12 Paragraph 48D(1)(a)
After “1984”, insert “and before 1 July 2002”.
Note: The heading to section 48D is altered by inserting “entered into before 1 July 2002” after “transactions”.
13 Subsection 52(1)
After “52H,”, insert “52JA, 52JB, 52JC, 52JD,”.
14 Subsection 52C(1)
Omit “and 52H”, substitute “, 52H, 52JA, 52JB, 52JC and 52JD”.
15 Subdivision B of Division 11 of Part IIIB (heading)
Repeal the heading, substitute:
Subdivision B—Dispositions of assets (general provisions)
16 After section 52F
Insert:
Subdivision BA—Dispositions of assets before 1 July 2002
52FAA Application
This Subdivision applies only to dispositions of assets that took place before 1 July 2002.
17 Subsection 52G(1)
After “1986”, insert “and before 1 July 2002”.
Note: The heading to section 52G is altered by inserting “in pension years” after “assets”.
18 Subsection 52H(1)
After “1986”, insert “and before 1 July 2002”.
Note: The heading to section 52H is altered by inserting “in pension years” after “assets”.
19 Before Subdivision C of Division 11 of Part IIIB
Insert:
Subdivision BB—Dispositions of assets on or after 1 July 2002
52JA Disposition of assets in tax year—individuals
Dispositions to which section applies
(1) This section applies to a disposition (the relevant disposition) on or after 1 July 2002 of an asset by a person who is not a member of a couple at the time of the relevant disposition.
Increase in value of assets
(2) If the amount of the relevant disposition, or the sum of that amount and the amounts (if any) of other dispositions of assets previously made by the person during the tax year in which the relevant disposition took place, exceeds $10,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the person’s assets for the period of 5 years starting on the day on which the relevant disposition took place:
(a) the amount of the relevant disposition;
(b) the amount by which the sum of the amount of the relevant disposition and the amounts (if any) of other dispositions of assets previously made by the person during the tax year in which the relevant disposition took place, exceeds $10,000.
Previous joint dispositions
(3) If, during the tax year in which the relevant disposition took place but before the time of the relevant disposition, the person was a member of a couple who jointly disposed of an asset, a reference in subsection (2) to the amounts (if any) of other dispositions of assets previously made by the person during that tax year includes a reference to one‑half of the amount of the joint disposition.
52JB Dispositions of assets in 5 year period—individuals
Disposition to which section applies
(1) This section also applies to a disposition (the relevant disposition) on or after 1 July 2002 of an asset by a person who is not a member of a couple at the time of the relevant disposition.
Increase in value of assets
(2) If:
(a) the sum of the amount of the relevant disposition and the amounts of any previous dispositions of assets made during the rolling period by the person;
less
(b) the sum of any amounts included in the value of the person’s assets during the rolling period under section 52JA, 52JC or 52JD or any previous application or applications of this section;
exceeds $30,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the person’s assets for the period of 5 years starting on the day on which the relevant disposition took place:
(c) an amount equal to the excess;
(d) the amount of the relevant disposition.
Previous joint dispositions
(3) If, during the rolling period but before the time of the relevant disposition, the person was a member of a couple who jointly disposed of an asset, the reference in paragraph (2)(a) to the amounts of any previous dispositions during the rolling period of assets by the person includes a reference to one‑half of the amount of the joint disposition.
Rolling period
(4) For the purposes of this section, the rolling period is the period comprising the tax year in which the relevant disposition took place and such (if any) of the 4 previous tax years as occurred after 30 June 2002.
52JC Disposition of assets in tax year—members of couples
Dispositions to which section applies
(1) If there is a disposition (the relevant disposition) on or after 1 July 2002 of an asset by:
(a) a person who, at the time of the relevant disposition, is a member of a couple; or
(b) the person referred to in paragraph (a) and the person who is, at that time, the partner of the person referred to in that paragraph;
subsection (2) has effect.
Increase in value of assets
(2) Subject to this section, if the amount of the relevant disposition, or the sum of that amount and the amounts (if any) of other dispositions of assets previously made by the person, the person’s partner, or the person and the person’s partner, during the tax year in which the relevant disposition took place (whether before or after they became members of the couple), exceeds $10,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the assets of the person and in the value of the assets of the partner for the period of 5 years starting on the day on which the relevant disposition took place:
(a) one‑half of the amount of the relevant disposition;
(b) one‑half of the amount by which the sum of the amount of the relevant disposition, and the amounts (if any) of other dispositions of assets previously made by the person, the partner, or the person and the partner, during the tax year in which the relevant disposition took place, exceeds $10,000.
Effect of ceasing to be member of couple
(3) If, after the disposition referred to in paragraph (1)(a), the person and the person’s partner cease to be members of the same couple:
(a) no amount is to be included after the cessation in the value of the assets of the former partner because of that disposition; and
(b) any amount that would, apart from this subsection, have been so included is to be included in the value of the assets of the person.
Effect of death of person
(4) If, after the disposition referred to in paragraph (1)(a), the person dies, no amount is to be included in the value of the assets of the person’s partner because of that disposition.
Effect of death of partner
(5) If, after the disposition referred to in paragraph (1)(a), the person’s partner dies, any amount that, if the partner had not died, would have been included in the value of the assets of the partner because of that disposition is to be included in the value of the assets of the person.
52JD Disposition of assets in 5 year period—members of couples
Dispositions to which section applies
(1) If there is a disposition (the relevant disposition) on or after 1 July 2002 of an asset by:
(a) a person who, at the time of the relevant disposition, is a member of a couple; or
(b) the person referred to in paragraph (a) and the person who is, at that time, the partner of the person referred to in that paragraph;
subsection (2) has effect.
Increase in value of assets
(2) Subject to this section, if:
(a) the sum of the amount of the relevant disposition and the amounts of any previous dispositions of assets made during the rolling period by the person, the person’s partner or the person and the person’s partner;
less
(b) the sum of any amounts included in the value of the assets of the person or of the partner during the rolling period under section 52JA, 52JB or 52JC or any previous application or applications of this section;
exceeds $30,000, then, for the purposes of this Act, the lesser of the following amounts is to be included in the value of the assets of the person and in the value of the assets of the partner for the period of 5 years starting on the day on which the relevant disposition took place:
(c) an amount equal to one‑half of the excess;
(d) one‑half of the amount of the relevant disposition.
Effect of ceasing to be member of couple
(3) If, after the disposition referred to in paragraph (1)(a), the person and the person’s partner cease to be members of the same couple:
(a) no amount is to be included after the cessation in the value of the assets of the former partner because of that disposition; and
(b) any amount that would, apart from this subsection, have been so included is to be included in the value of the assets of the person.
Effect of death of person
(4) If, after the disposition referred to in paragraph (1)(a), the person dies, no amount is to be included in the value of the assets of the person’s partner because of that disposition.
Effect of death of partner
(5) If, after the disposition referred to in paragraph (1)(a), the person’s partner dies, any amount that, if the partner had not died, would have been included in the value of the assets of the partner because of that disposition is to be included in the value of the assets of the person.
Rolling period
(6) For the purposes of this section, the rolling period is the period comprising the tax year in which the relevant disposition took place and such (if any) of the 4 previous tax years as occurred after 30 June 2002.
20 Paragraph 52Q(3)(e)
Omit “section 52G”, substitute “sections 52G, 52JA and 52JB”.
21 Paragraph 52U(4)(e)
Omit “and 52H”, substitute “, 52H, 52JA, 52JB, 52JC and 52JD”.
22 Subparagraph 52Y(1)(b)(i)
Omit “and 52H”, substitute “, 52H, 52JA, 52JB, 52JC and 52JD”.
23 Paragraph 52Z(7)(a)
Omit “or 52H”, substitute “, 52H, 52JA, 52JB, 52JC or 52JD”.
24 Subsection 52ZZW(1)
Omit “Subdivision B of Division 11 and section 45UT”, substitute “Subdivisions BA and BB of Division 11 and sections 45UT and 45UTA”.
25 Subsection 52ZZX(1)
Omit “Subdivision B of Division 11 and section 45UT”, substitute “Subdivisions BA and BB of Division 11 and sections 45UT and 45UTA”.
26 Section 52ZZY
Omit “Subdivision B of Division 11 and section 45UT”, substitute “Subdivisions BA and BB of Division 11 and sections 45UT and 45UTA”.
27 Subparagraph 52ZZZ(1)(c)(i)
Omit “Subdivision B”, substitute “Subdivision BA or BB”.
28 Paragraph 52ZZZ(1)(e)
Repeal the paragraph, substitute:
(e) in a case where the individual’s asset attribution percentage is 100%—Subdivisions BA and BB of Division 11 and sections 45UT and 45UTA have effect, in relation to the disposal of the asset referred to in paragraph (b), as if references in those Subdivisions and sections to the period of 5 years starting on the day on which the disposition took place were references to the period:
(i) beginning on the day on which the disposition took place; and
(ii) ending immediately before 1 January 2002; or
29 Paragraph 52ZZZ(1)(f)
Omit “Subdivision B of Division 11 and section 45UT”, substitute “Subdivisions BA and BB of Division 11 and sections 45UT and 45UTA”.
30 Subparagraph 52ZZZA(1)(c)(i)
Omit “Subdivision B”, substitute “Subdivision BA or BB”.
31 Paragraph 52ZZZA(1)(e)
Repeal the paragraph, substitute:
(e) in a case where the spouse’s asset attribution percentage is 100%—Subdivisions BA and BB of Division 11 and sections 45UT and 45UTA have effect, in relation to the disposal of the asset referred to in paragraph (b), as if references in those Subdivisions and sections to the period of 5 years starting on the day on which the disposition took place were references to the period:
(i) beginning on the day on which the disposition took place; and
(ii) ending immediately before 1 January 2002; or
32 Paragraph 52ZZZA(1)(f)
Omit “Subdivision B of Division 11 and section 45UT”, substitute “Subdivisions BA and BB of Division 11 and sections 45UT and 45UTA”.
33 Paragraph 52ZZZG(1)(c)
Omit “Subdivision B”, substitute “Subdivision BA or BB”.
34 Paragraph 52ZZZG(1)(d)
Omit “Subdivision B”, substitute “Subdivision BA or BB”.
35 Clause 15 of Schedule 5
Omit “and 52H”, substitute “, 52H, 52JA, 52JB, 52JC and 52JD”.
36 Clause 17D of Schedule 5
Omit “and 52H”, substitute “, 52H, 52JA, 52JB, 52JC and 52JD”.
[Minister’s second reading speech made in—
House of Representatives on 14 March 2002
Senate on 19 June 2002]
(74/02)