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Three years after a landmark case over the impact of gifting on subsidies for long term residential care, a legal expert says the guidelines are still unclear and confusing.
The 2018 case related to then 80 year old, Gwyneth Broadbent, who over a period of time sold the family home, and holiday home, into family trusts, within the allowable limit of $27,000 a year.
By the time she needed to go into a care home in 2014 nearly $330,000 worth of assets had been gifted.
But the Ministry of Social Development argued that the assets' value had increased over the years, thanks to the property boom, and therefore, Mrs Broadbent had deprived herself of an income, and should contribute to the cost of her care.
The Broadbents challenged and won at the High Court, but the ministry appealed the decision and a settlement was reached. So what are the current guidelines?
And what do people considering gifting money to their children need to know? Theresa Donnelly is Legal Services Manager for Perpetual Guardian.
