Special Disability Trusts

Centrelink has allowed a Special Disability Trust to be set up for a person who is in receipt of a disability Centrelink pension or are Veteran’s Affairs pensions. The amount that can be placed in the disability trust basically increases each year. It increases pursuant to roughly by the Consumer Price Index. The current amount is $580,000.

Such sum is exempt from the assets test of the donor and also of the beneficiary. Likewise, the income earnt from the funds in the disability trust is not subject to the income tests of Centrelink or the Department of Veteran’s Affairs.

It used to be that funds in the disability trust would only relate to care and accommodation needs. Now and since the 1st January 2011 a special disability trust is able to pay for :

1. The beneficiary’s medical expenses including private health fund membership and dental treatment.

2. Care and accommodation needs.

3. A discretionary spending amount up to $10,250.00 per year (which is also indexed annually on the 1st of July each year) to meet additional costs relating to the beneficiaries health, wellbeing, recreation, independence and social inclusion. Some of the discretionary amount can be food, other than food specified by a medical practitioner as essential for the beneficiary’s health.

4. Toiletries such as toothpaste, toilet paper, soap, shampoo, sanitary pads and tampons.

5. Vehicle maintenance and vehicle related expenses other than those required for all because of the beneficiary’s disability.

6. Vehicle registration and insurance.

7. Petrol for vehicle.

8. Recreation and leisure activities.

9. Computer, except if the computer is essential for communication because of the beneficiary’s disabilities ( as this can be paid out for out of the other trustees monies).

10. Communication devices, unless modified because of the beneficiary’s disability.

11. Therapy that is not required for or because of the beneficiary’s disability or that is not approved in writing by a Medical Practitioner.

12. Building and contents insurance.

13. Payment of utilities charges and connection with the principal beneficiaries place of residence.

14. Household cleaning service.

The trust of course can be set up in a Will so that when a person dies monies go into a trust that is set up. Or if there is already a trust set up then funds can be left to that disability trust via a person in their Will.

Aired March 2013 on Radio 2RG