Commonwealth Consolidated Acts

SOCIAL SECURITY ACT 1991 - SECT 1130C

Value of unrealisable asset to be disregarded

  (1)   If section   1130B applies to a person, the value of any unrealisable asset of the person is to be disregarded in working out whether a pension PP (single) is payable to the person.

Deduction from pension PP (single) maximum payment rate

  (2)   If section   1130B applies to a person, there is to be deducted from the person's pension PP (single) maximum payment rate an amount equal to the person's adjusted annual rate of ordinary income.

Note:   For maximum payment rate see Step 4 of the method statement in point 1068A - A1.

Adjusted annual rate of ordinary income

  (3)   The person's adjusted annual rate of ordinary income is an amount per year equal to the sum of:

  (a)   the person's annual rate of ordinary income (other than income from assets); and

  (b)   the person's annual rate of ordinary income from assets that are not assets tested; and

  (c)   either:

  (i)   the person's annual rate of ordinary income from unrealisable assets; or

  (ii)   the person's notional annual rate of ordinary income from unrealisable assets;

    whichever is the greater; and

  (d)   an amount per year equal to $26.00 for each $250 of the value of the person's assets (other than disregarded assets); and

  (e)   any amounts that are not income of the person because of paragraph   8(8)(zp).

Assets tested asset

  (5)   For the purposes of paragraph   (3)(b), an asset is not assets tested if the value of the asset is to be disregarded under subsection   1118(1).

Notional annual rate of ordinary income from unrealisable assets

  (6)   A person's notional annual rate of ordinary income from unrealisable assets is:

  (a)   the amount per year equal to 2.5 per cent of the value of the person's unrealisable assets; or

  (b)   the amount per year that could reasonably be expected to be obtained from a purely commercial application of the person's unrealisable assets;

whichever is the lesser.

  (7)   Subsection   (2) applies:

  (a)   subject to subsection   (9); and

  (b)   despite section   500Q.

  (8)   If:

  (a)   a person has disposed of assets and section   1125, 1126, 1126AA, 1126AB, 1126AC, 1126AD or 1126E (so far as section   1126E relates to section   1126AA, 1126AB, 1126AC or 1126AD) applies to the disposition; and

  (b)   the Secretary has made a determination under paragraph   1130B(1)(c) in relation to the disposition;

this section applies to the person as if the person had not disposed of the assets.

  (9)   If the sum of the rate of pension PP (single) that would, apart from this subsection, be payable to a person and the annual rate of ordinary income of the person exceeds the maximum payment rate, the rate so payable is to be reduced by the amount per year of the excess.