Blog #12 Fact #11 What are current income thresholds for aged care and what do they mean? (as of March 21)

Income Free Area (single person)                                                              $ 28,472.60

Income Free Area (couple, illness separated, single rate)                 $ 27,952.60

These thresholds are what an individual may earn without being impacted by the Residential Aged Care income test. Any surplus above these amounts will count towards means testing. An example is as follows:

Two members of a couple each earn $40,000 per year. The calculation for the income test is as follows:

                                $40,000 - $28,472.60 = $11,527.40

                                $11,527.40 is now halved ($11,527.40 x 50% = $5,763.70)

                                $5,763.70 now divided by 364 (not 365) to obtain the daily fee

$5763.70/364 = $15.83 and is the means tested income fee in this example. This calculation is completed for each member of the couple. [Note: Annual Fee is divided by 364 not 365]