Who Qualifies as a Low-Means Resident

A low-means resident is a person who is assessed to have low financial capacity as at the date of entry into permanent residential care.

Under current rates, this is a person whose means-test amount (MTA) is assessed to be lower than $69.79 as at the date of permanent entry. The MTA is based on a combination of assets and income.

If the person’s assessable assets are $206,663.20 (equal to the capped value for the home) or more, they will not qualify as low-means. If the person is a member of a couple, assets and income are combined and then split equally. To qualify as low-means, that person’s half of assessable assets needs to be less than $206,663.20.

You may also hear low-means residents being referred to as supported or concessional residents.

A quick rule of thumb to determine low-means: If you own a home that has a market value higher than the capped value, and there is no-one remaining in the home who meets the definition of a protected person, you will not qualify as a low-means resident.

But assets are only one half of the MTA calculation as the calculation also includes an income amount. Therefore, a person with assets (or their half of the assets) below this threshold may still not qualify as low-means if they have higher levels of assessable income that result in an MTA of $69.79 or higher. This will generally only apply if the person has income such as a defined benefit pension, foreign income or a partner who is working or has other income sources that are not attached to an assessable asset.

The diagram below shows the interaction between assets and income. A person who falls into the shaded areas qualifies as low-means.

Example Scenario

Rowan and his wife Alice have the following assets:

• Home $1,200,000

• Contents $5,000

• Cash/shares $180,000 (jointly owned)

When Rowan moves into residential care, Alice continues to live in the home. This makes the home exempt, so Rowan is assessed to have assessable assets of $92,500 and an MTA of $14.90. This is below the threshold, and he qualifies as a low-means resident.

Centrelink/DVA Records

When the person enters residential care, they need to ensure that Centrelink / Veterans’ Affairs (DVA) records are accurate and up-to-date as these records will be used to calculate the MTA. It is recommended that the person at least update the bank account balance on record, because Services Australia /DVA won’t do the assessment if there has not been a update by the person within the last two years.

If the person owns a home, the SA485 or SA457 form needs to be completed and lodged with Services Australia/DVA to provide details on the home. The person has an ongoing obligation to keep Centrelink/DVA updated with any changes that occur after entry.

Impact of Changes to MTA

If the person is assessed as a low-means resident at the date of permanent entry into residential care, they remain classified as a low-means resident for the duration of their stay with that care provider, regardless of any future changes to their MTA.

This means, that even if their MTA has increased to a level above $69.79, they continue to be assessed as a low-means resident but will pay the full accommodation subsidy for their room. The government no longer pays part of the cost. The person does not move to the RAD system and cannot be required to pay the market price for their room.

However, if the person moves to a new provider, the MTA is fully reassessed to determine whether they are low-means or not at entry into the new care provider.

Let us take away some of the stress. Contact us today to make an appointment to discuss your current or future aged care needs.

Bill Savellis

Senior Financial Adviser

Having navigated the Aged Care landscape for both of his parents, Bill understands how challenging it can be to make the right decisions for your future care needs. That's why he believes that everyone should have access to financial advice during this time. Bill has been a Financial Adviser for over 22 years, and is passionate about helping others access the financial advice they need. Drawing from his own experience in the financial sector, Bill develops strategic, personalised plans to support transitions to Aged Care or Home Care.

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Disclaimer: Prepared without taking into account your objectives, financial situation or needs. Before acting on any information in this article, Olive Grove Financial Advice recommends that you consider whether it is appropriate for your circumstances. Information in this article was correct and current as of 29 September 2025. Olive Grove Financial Advice is operated by Bill Savellis through The Financial Advisor (Australia) Pty Ltd ABN 72 619 546 431, who is a Corporate Authorised Representative (No. 1278394) of Havana Financial Services Pty Ltd.