“As an aged pensioner, when do I have to advise Centrelink I have sold an investment property? Is it when the contract of sale is signed, when it becomes unconditional or when the property settles?"
-Question from Stuart in Melbourne
Top answer provided by:
Ryan Scherini
Hi Stuart,
Thanks for your question and congratulations on selling your property. I hope you were able to achieve what you were seeking in this relatively volatile market.
Firstly, I’d like to make a few assumptions as I don’t know your personal circumstances. I’ll assume that you’ve kept Centrelink up to date with your financial situation.
We live in a society where a lot of information is data-fed through to Government Agencies such as Centrelink, Medicare, and the Tax Office. It is still important to understand that you’re ultimately responsible for the information that is reported to Centrelink for your various payments or allowances. Centrelink requests that information is updated within 14 days of any major changes that could impact your payments. With the information sharing that is available to Centrelink, it’s important to note that Centrelink does title checks regularly to ensure that assets aren’t changing hands and that valuations are up to date.
It's a great question that you raise, and I can’t find a specific resource that I can refer you to that can answer your question. However, I’ll give you my opinion which I would stress that you should check with Centrelink directly. Ultimately, they’re responsible for your assessment and payments.
My understanding, is that Centrelink would only be concerned with the asset changing hands, being that settlement would be the key date for you to report the asset sale to Centrelink. You should be updating Centrelink based on the asset that is available to you upon the settlement of the property. That is, the sale value, less any selling costs involved. If you are liable for Capital Gains Tax, you should report any payment made to Centrelink once you have paid it to the Tax Office. One of the easier ways to update Centrelink is via their online portal accessible through MyGov. A helpful guide for various scenarios can be found here. It’s important to note that Centrelink may also request a copy of the Settlement Statement as evidence. You can also upload this to Centrelink via MyGov. Please see here for instructions on how to do this.
Whilst not knowing your personal or financial situation, it would be safe to assume that selling this property must be a significant decision for you. In saying that, I think it’s imperative that you seek some financial advice to better understand the wider impacts of selling the property can have on your overall situations such as:
- Superannuation / Pension Strategies
- Estate Planning Implications
- Investment Strategies
- Centrelink
- Overall Retirement Funding & Cashflow implications
- Taxation and many more
You can find some great advisers in your location using the Adviser Ratings website and searching by location.
While the Adviser Ratings Website facilitates the question and answer functionality, all such communications are between users and authorised financial advisers, of which Adviser Ratings has no affiliation. Adviser Ratings is not the advice provider and does not provide financial product advice and only provides information that is general in nature.
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