Myfather. My father in law has about 1,000,000 in CASH AND SHARES. My freind said we should reduce his assets by gifting

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Customer: Hi there,myfather
JA: Hi. How can I help?
Customer: My father in law has about 1,000,000 in CASH AND SHARES. My freind said we should reduce his assets by gifting as her lawyer has advised her.. -my friend says 6000 per person up to 27,000 per year in case he goes to a rest home (and that money could go to paying for the rest home care. However our lawyer says that the 27,000 is old law and the new law states that only 6500 can be gifted per year to only one person. what is correct now?
JA: What state are your father and your father-in-law and your friend in? It matters because laws vary by location.
Customer: we live in NZ
JA: What steps have they taken so far?
Customer: Bay of Plenty
JA: Anything else you want the Lawyer to know before I connect you?
Customer: none because we can't agree on the law
Answered by Chris The Lawyer in 5 mins 2 years ago
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Chris The Lawyer, Expert

Hi
I am a New Zealand lawyer based in Wellington and will help you with your question today. Please give me a minute to read the question

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Chris The Lawyer, Expert

In order to make a gift without impacting on an application for a rest home subsidy, the maximum amount a single person can gift is $27,000 per annum, while the maximum amount a couple can gift is $13,500 each (totalling $27,000 between them).

However within the five years immediately prior to making an application for a rest home subsidy the current allowed gifting amount reduces to $6,000 a year per person. Therefore, the current balance of $7,500 per year per person (for the preceding five years from the date of the residential care subsidy application) can be taken into account as part of your personal assets when completing a financial means assessment.

Any gift of more than $27,000 in any one year will likely be seen as “deprivation of assets” by WINZ when making an assessment for a rest home subsidy, and the whole gift could be “clawed back” by WINZ and counted as an asset in your hands.

Customer
OK,so my father is living with us and is not in a rest home yet. He has 1,000,000 in cash and shares. How much can he gift to us without it being counted as 'deprivation of assetts'?
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Chris The Lawyer, Expert

Only $7500 per year if he is likely to need rest home care

Customer
Hmmm, I'll see what my accountant says... I already pay him a lot of money.. Thanks
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Chris The Lawyer, Expert

Gifting is looked at closely these days

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