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Rest Homes & Hospitals   Cost of care   Income & asset testing

Asset Testing

From July 1 2018, asset thresholds for Residential Care Subsidy  are as follows:

dot $227,125 for a single or widowed person in care
dot $227,125 for a couple with both partners in care
dot $124,379 for a couple with one partner in care (house and car remain exempt). Couples can choose to be tested under the $227,125 threshold, but the house and car will not be exempt.
Asset thresholds increase by the rate of increase in the Consumer Price Index each year. Check the Ministry of Health website for further details, or ask Seniorline to send information.

Income Testing

A person receiving Residential Care Subsidy is required to contribute income toward the cost of care. This includes NZ Super, pensions and other sources of income. A small amount of income from assets is exempt. Earnings of a partner in paid employment, War Disablement pension and 50% of private super schemes are not counted as income. See further detail on the Work and Income website.


You are required to complete a declaration of assets sold or gifted and you will need to provide trust documents if you have set up a trust. In some cases, assets you have transferred to a trust can still be counted as yours. Work and Income will require more information if you or your spouse/partner have ever: transferred or sold assets to a trust,  been the settlor, trustee or beneficiary of a trust.

Pre-paid Funeral Trusts

Pre-paid funeral expenses up to $10,000 for each partner are not counted as assets by Work and Income.


The rules relating to gifting for someone who applies for Residential Care Subsidy are quite different to those used by Inland Revenue. Discuss detail with Work and Income, phone 0800 999 727.

Your Home

Your home counts as an asset for single people or couples where both are in long term residential care. If you are not financially eligible for Residential Care Subsidy, have cash assets of $15,000 (per person) or less, you can apply for an interest-free loan.

Residential Care Loan

You arrange a loan by completing a financial means assessment in the usual way then answering additional questions specific to the loan. If you qualify, Ministry of Social Development (through Work and Income) will ask you to sign a legal contract called the ‘Residential Care Loan Agreement’. The loan is secured over your home and a caveat is usually registered against the title. The loan is repaid when your home is sold, or from your estate.

Formal policy statement for the Residential Care Loan Scheme

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