Disposal of assets in pre‑pension years—members of couples
1125A Disposal of assets in pre‑pension years—members of couples
This section applies only to disposals of assets that took place before 1 July 2002.
Subject to subsections (3), (4) and (5), if:
a person has disposed of an asset; and
the person is a member of a couple when the person or the person’s partner claims a pension, benefit or payment of a kind referred to in subsection 11(10A) or when the person’s partner claims a youth training allowance; and
the person disposed of the asset:
during a pre‑pension year of the person; or
if the person has not claimed a pension, benefit or payment of a kind referred to in subsection 11(10A) but the person’s partner has claimed such a pension, benefit or payment or has claimed a youth training allowance—during a pre‑pension year of the person’s partner; and
the amount of that disposition, or the sum of that amount and the amounts (if any) of other dispositions of assets previously made by the person or the person’s partner during that pre‑pension year, exceeds the disposal limit;
then, for the purposes of determining whether a pension, benefit, payment or allowance is payable to the person:
there is to be included in the value of the person’s assets for the period of 5 years that starts on the day on which the disposition took place:
50% of the amount by which the sum of the amount of the first‑mentioned disposition and of the amounts (if any) of other dispositions of assets previously made by the person or the person’s partner during that pre‑pension year exceeds the disposal limit; or
50% of the amount of the first‑mentioned disposition;
whichever is the lesser amount; and
there is to be included in the value of the assets of the person’s partner for the period of 5 years that starts on the day on which the disposition took place:
50% of the amount by which the sum of the amount of the first‑mentioned disposition and of the amounts (if any) of other dispositions of assets previously made by the person or the person’s partner during that pre‑pension year exceeds the disposal limit; or
50% of the amount of the first‑mentioned disposition;
whichever is the lesser amount.
For disposes of assets see section 1123.
For amount of disposition see section 1124.
If a pension or benefit is payable to the person, section 1126 operates to determine the rate of payment and section 1125A ceases to apply to the person.
If:
amounts are included under subsection (1) in the value of a person’s assets who is a member of a couple and in the assets of the person’s partner because of a disposition of an asset by the person; and
the person and the person’s partner cease to be members of the same couple;
any amount that was included in the value of the person’s former partner’s assets because of that disposition is to be included in the value of the person’s assets.
If:
an amount is included under subsection (1) in the value of the assets of a person who is a member of a couple and the value of the assets of the person’s partner because of a disposition of an asset by the person; and
the person dies;
an amount is not to be included in the value of the assets of the person’s partner because of that disposition.
If:
an amount is included under subsection (1) in the value of the assets of a person who is a member of a couple and the value of the assets of the person’s partner because of a disposition of an asset by the person; and
the partner dies;
any amount that would, if the partner had not died, be included in the value of the partner’s assets because of the disposition is to be included in the value of the person’s assets.
In this section:
disposal limit means:
in relation to assets disposed of on or after 1 March 1986 and before 1 March 1991—$4,000; and
in relation to assets disposed of on or after 1 March 1991—$10,000.
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