Gifting programmes under attack

July 18, 2013

in Trusts

Trusts: GiftingThe Ministry of Social Development (“MSD”) has recently obtained support through a decision of the High Court in respect to the assessment of gifts made by couples for Rest Home Subsidy Application purposes.

Throughout the country couples were making gifts of $27,000.00 each as part of their gifting programme which complied with the restrictions of the Gift Duty regime.

Gift Duty was repealed but the MSD adopted the policy that in respect to an Application for Rest Home Subsidy where the Applicant has made gifts of $27,000.00 and has a spouse or partner who has also made gifts of $27,000.00 then the spouse or partners gifts are treated as “deprivation” and becomes part of the asset assessment of the Applicant.

This policy could cause a great deal of difficulty for couples throughout the country.

Fortunately the High Court decision is being appealed to the Court of Appeal so there remains a glimmer of hope that the difficulty will be resolved.

A Hearing in the Court of Appeal is scheduled for August so watch this space.

In the meantime we have been giving serious consideration to possible options in individual cases to try and deal with this problem.

If you require any advice or further information on the matters dealt with in this publication please contact the lawyer at Farry and Co. who normally advises you, or alternatively contact:

Richard Farry

rfarry@farry.co.nz

03 477 8870 or 09 379 0055

 

The information contained in this publication is intended as a guide only.  It does not constitute legal advice and should not be relied upon as such.  Professional advice should be sought before applying any of the information to particular circumstances.  While every reasonable care has been taken in the preparation of this publication, Farry and Co. does not accept liability for any errors it may contain. 

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