What with lump sums from superannuation, inheritances and investments maturing, some retirees find they have large amounts of money come into their hands – which is great, unless they forget to take into account Centrelink’s rules on gifting before using that money to help out their adult children.
That’s because are specific pension rules applying to gifting or lending when in receipt of the Age Pension. If you are receiving a pension, you can only gift an amount of $10,000 in each year and $30,000 in aggregate over five years. If you exceed these limits, any amount you gift above the limits will be regarded as part of your assets for five years after the gifting and may thus reduce your pension entitlement under Centrelink’s assets test.
Read more from our Money Club expert Brian Herd about the financial impacts of gifting money.