Deprivation test

Discretion is available to include deprived assets or income in the financial means assessment as if the deprivation had not occurred. When deprivation has occurred, this does not necessarily mean we should use discretion to include the deprived property and/or income in the assessment.

A 3-step test is used to determine if deprivation has occurred and how much, if any, deprived amounts will be included.

1. Has deprivation occurred?

This is a factual consideration. Specific acts of deprivation need to be identified and assessed individually.

Please see:

• Deprivation of assets and income
• Examples of deprivation

2. Should discretion be used to include the deprivation?

Would including the deprivation make a difference to the financial means assessment outcome? For example, will it push the client’s assets over the threshold, or result in a lesser subsidy?

Are there other resources available to the client to meet the cost of care if a deprived amount is counted back? Generally, we do not use discretion to count the deprived amount in the financial means assessment if the client has no other resources except their exempt assets or assets below the threshold to meet the personal contribution they would have to pay towards their care as a result.

In some instances, resources may be assumed to be available to the client. For example, if the client and/or their partner is a beneficiary of a family trust, it might be reasonable to expect the trust to support the clients.

For more information see:

• Using discretion
• Available resources

3. How should the deprivation be applied?

Calculate the amount that was deprived (e.g. asset value, actual or notional income).

Determine a reasonable amount to include in the financial means assessment. The client must have resources available (other than assets under the threshold) to meet any extra contribution this amount will result in.

For more information see: