“Granny Flat” Agreements
For older Australians, a ‘granny flat’ agreement can be an effective tool providing security without affecting pension entitlements.
There is increasing uncertainty about the treatment of the family home as part of Centrelink’s asset testing for pensions. Also, as people grow older the family home may longer be suitable accommodation. With appropriate financial and legal advice, the ‘granny flat interest’ rules can be useful in dealing with such assets, while at the same time ensuring that older Australians have proper accommodation and a reasonable alternative to commercial assisted living.