{"id":"F2025L00219","name":"Veterans' Entitlements (Attribution of Assets) Principles 2025","slug":"veterans-entitlements-attribution-of-assets-principles-2025","collection":"legislative_instrument","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":null,"makingDate":null,"administeringDepartment":null,"currentVersion":{"id":106039,"registerId":"commonwealth-F2025L00219-current","compilationNumber":null,"startDate":"2026-04-03","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"Veterans' Entitlements (Attribution of Assets) Principles 2025","content":"![Coat of Arms of the Commonwealth of Australia](image.001.jpeg)\n\nVeterans' Entitlements (Attribution of Assets) Principles 2025\n\nThe Repatriation Commission makes the following instrument.\n\nDated 19 February 2025\n\nThe Seal of the\n\nRepatriation Commission\n\nwas affixed to this instrument\n\nin the presence of:\n\n| Alison Frame | Mark Brewer      |\n| ------------ | ---------------- |\n|              | AM CSC and Bar   |\n| President    | Deputy President |\n| Gwen Cherne  | Kahlil Fegan     |\n|              | DSC AM           |\n| Commissioner | Commissioner     |\n\nPart 1 Preliminary\n\n1 Name\n\nThis instrument is the Veterans’ Entitlements (Attribution of Assets)  \nPrinciples 2025.\n\n2 Commencement\n\nThis instrument commences on the day after the day it is registered.\n\n3 Authority\n\nThis instrument is made under section 52ZZZQ of the Veterans’ Entitlements Act 1986.\n\n3A Repeal\n\nSchedule 3 to the Veterans’ Affairs (Legislative Instrument Re-making Exercise) Instrument 2014 is repealed.\n\n4 Definitions\n\n> Note: A number of expressions used in this instrument are defined in the Act, including the following:\n\n    arm’s length amount (see section 52ZO);\n    attributable stakeholder – of a company or trust (see section 52ZZJ);\n    Commission (see section 5Q);\n    company (see section 52ZO);\n    trust (see section 52ZO of the Act).\n\n  In this instrument, unless the contrary intention appears:\n\n> Act means the Veterans’ Entitlements Act 1986.\n\nsocial security entitlement has the same meaning it has in the Social Security Act 1991.\n\n  \n\nPart 2 Excluded assets\n\n5 Purpose of Part 2\n\n  The purpose of this Part is to set out decision-making principles with which the Commission must comply for the purposes of making a determination under subsection 52ZZR(2) of the Act.\n\n6 Excluded asset — capital transfer by genuine investor\n\n(1) This section applies if an individual (the investor), who is not an attributable stakeholder of a company, makes a genuine transfer of capital to the company for shares in the company.\n\n    This section also applies if an individual (the investor), who is not an attributable stakeholder of a trust, makes a genuine transfer of capital to the trust for units in the trust.\n\n(3) For subsections (1) and (2), a transfer of capital is a genuine transfer of capital if:\n\n(a) the investor is over 18 years; and\n\n(b) the investor receives, as consideration for the transfer, shares in the company, or units in the trust, of a value that is equivalent to the value of the capital transferred; and\n\n(c) the investor has a legal or equitable right to a share of the capital on the winding-up of the company or trust; and\n\n(d) the investor has a legal or equitable right to receive dividends or distributions under the constituent documents of the company or the terms of the trust.\n\n    The Commission must consider the extent to which capital transferred in accordance with subsection (3) should be determined to be an excluded asset in relation to an attributable stakeholder of the company or trust, having regard to:\n\n(a) the value of the capital transferred to the company or trust; and\n\n(b) the value of shares or units received by the investor; and\n\n(c) the extent, if any, to which the value of the capital would not be required to be disregarded by any express provision of the Act.\n\n  \n\nPart 3 Excluded charge or encumbrance\n\n7 Purpose of Part 3\n\n  The purpose of this Part is to set out decision-making principles with which the Commission must comply for the purposes of making a determination under subsection 52ZZT (6) of the Act.\n\n8 Determination that charge or encumbrance is excluded\n\nIn relation to a charge or encumbrance, the Commission must take into account:\n\n(a) whether a transaction that gave rise to the charge or encumbrance was an arm’s length transaction, having regard to the criteria described in section 9; and\n\n(b) the matters referred to in section 10.\n\n9 Criteria for arm’s length transaction\n\n(1) For paragraph 8 (a), a transaction is an arm’s length transaction if:\n\n(a) the transaction is for the purposes of the business activities of the company or trust; and\n\n(b) the transaction is made under a written agreement that is signed by each party to the agreement, and witnessed by an individual who is not a party to the transaction; and\n\n(c) each party to the transaction is:\n\n(i) at least 18 years old; or\n\n(ii) at least 16 years old and engaged in a full-time occupation; or\n\n(iii) at least 16 years old and receiving a social security entitlement; and\n\n(d) the transaction is made for an arm’s length amount.\n\n(2) For subparagraph (1) (c) (ii), a full-time occupation:\n\n(a) includes any employment, trade, business, profession, vocation or calling; and\n\n(b) does not include a course of education at a school, college, university or similar institution.\n\n10 Other matters\n\nFor paragraph 8 (b), the Commission must also take into account, in relation to the transaction that gave rise to the charge or encumbrance:\n\n(a) whether the individual is the sole attributable stakeholder, or a member of a couple both members of which are the only 2 attributable stakeholders of the company or trust; and\n\n(b) the commercial, social and familial relationships (if any) between the parties to the transaction; and\n\n(c) the nature and circumstances of the transaction.\n\n  \n\nPart 4 Effect of loan not secured by charge or encumbrance over asset of company or trust\n\n11 Purpose of Part 4\n\nThe purpose of this Part is to set out decision-making principles with which the Commission must comply in making a determination under subsection 52ZZU (1) of the Act.\n\n12 Effect of unsecured loan on value of assets\n\nIn relation to an unsecured loan, the Commission must take into account:\n\n(a) whether a transaction that gave rise to the loan was an arm’s length transaction, having regard to the criteria described in section 13; and\n\n(b) the matters referred to in section 14.\n\n13 Criteria for arm’s length transaction\n\n(1) For paragraph 12 (a), a transaction is an arm’s length transaction if:\n\n(a) the transaction is for the purposes of the business activities of the company or trust; and\n\n(b) the transaction is made under a written agreement that is signed by each party to the agreement, and witnessed by an individual who is not a party to the transaction; and\n\n(c) each party to the transaction is:\n\n(i) at least 18 years old; or\n\n(ii) at least 16 years old and engaged in a full-time occupation; or\n\n(iii) at least 16 years old and receiving a social security entitlement; and\n\n(d) the transaction is made for an arm’s length amount.\n\n(2) For subparagraph (1) (c) (ii), a full-time occupation:\n\n(a) includes any employment, trade, business, profession, vocation or calling; and\n\n(b) does not include a course of education at a school, college, university or similar institution.\n\n14 Other matters\n\nFor paragraph 12 (b), the Commission must also take into account, in relation to the transaction that gave rise to the charge or encumbrance:\n\n(a) whether the individual is the sole attributable stakeholder, or a member of a couple both members of which are the only 2 attributable stakeholders of the company or trust; and\n\n(b) whether the loan is secured by a charge or encumbrance over an asset other than an asset described in paragraph 52ZZU (1) (b) of the Act; and\n\n(c) the commercial, social and familial relationships (if any) between the parties to the transaction; and\n\n(d) the nature and circumstances of the transaction.","sortOrder":0}],"analysis":{"flash_summary":{"complexity_score":6,"scope_assessment":{"changed":true,"description":"This instrument repeals Schedule 3 of the 2014 re‑making instrument (s3A) and sets out new decision‑making principles in Parts 2–4 for how the Commission determines excluded assets, excluded charges/encumbrances and the effect of unsecured loans (see Parts 2–4). That repeal plus the newly prescribed criteria means the decision‑making guidance governing attribution has been changed from the prior instrument to the tests and considerations now listed (s3A; Parts 2–4)."},"complexity_factors":["Cross‑references to the Act for defined terms (e.g. 'arm’s length amount', 'attributable stakeholder', 'company', 'trust') mean interpretation depends on external definitions (see s4 and the Act).","Subjective multi‑factor tests such as what counts as a 'genuine transfer of capital' require factual valuation and legal‑rights assessments (s6(3) and s6(4)(a)–(c)).","Arm’s‑length criteria impose procedural and evidentiary requirements (written agreement, witness, age/occupation thresholds) that create compliance burdens and proof obligations (s9(1)(b)–(d); s13(1)(b)–(d)).","Commission discretion is structured but not wholly mechanical: the instrument lists matters the Commission 'must take into account' rather than fixed formulas, requiring judgement on relationships, nature and circumstances (see s6(4), s8, s10, s12, s14).","Repeated, similar arm’s‑length tests across Parts 3 and 4 increase interpretive overlap (compare s9 and s13), raising questions about consistency of application between charges/encumbrances and unsecured loans.","Valuation equivalence requirements (value of capital v. value of shares/units) create need for expert valuation evidence and raise dispute risk (s6(3)(b); s6(4)(a)–(b)).","Documentation and witnessing rules (s9(1)(b); s13(1)(b)) transfer administrative cost to private parties (investors, companies, trusts) who must produce compliant records.","Interaction with other Commonwealth legislation (e.g. Social Security Act reference for 'social security entitlement') may require cross‑agency or cross‑statute interpretation (s4).","A formal repeal of an earlier instrument schedule (s3A) implies potential change to prior practice and requires comparing instruments to determine scope shifts (s3A)."],"plain_english_summary":"This instrument tells the Repatriation Commission how to decide when capital transfers, charges/encumbrances and unsecured loans involving companies or trusts should be treated as excluded assets for veterans’ entitlements purposes. It affects investors, attributable stakeholders, companies and trusts by imposing arm’s‑length, documentation and valuation tests and by requiring the Commission to take account of relationships and circumstances when attributing assets."},"flash_summary_failed":{"failed":true,"reason":"Unauthenticated. Configure AI_GATEWAY_API_KEY or use a provider module. Learn more: https://ai-sdk.dev/unauthenticated-ai-gateway","source":"analysis-cron"},"kimi_summary":{"content_quality":"ok","complexity_score":4,"scope_assessment":{"changed":false,"description":"This is a straightforward re-making of existing legislative principles under the Veterans' Affairs (Legislative Instrument Re-making Exercise) Instrument 2014. It repeals and replaces Schedule 3 of that instrument without expanding beyond the original purpose of providing decision-making principles for asset attribution in veterans' entitlements law."},"complexity_factors":["Heavy reliance on defined terms from the parent Act (Veterans' Entitlements Act 1986), including 'attributable stakeholder', 'arm's length amount', 'company', and 'trust'","Cross-referencing to specific subsections of the Act (52ZZR(2), 52ZZT(6), 52ZZU(1)) without reproducing their content","Repetitive structure: Parts 3 and 4 contain nearly identical 'arm's length transaction' criteria (sections 9 and 13 are word-for-word duplicates)","Nested conditions for 'genuine transfer of capital' requiring four separate criteria to be met simultaneously","Age and status exceptions for parties to transactions (16+ with job/Centrelink vs 18+)","Reference to external legislation (Social Security Act 1991) for definition of 'social security entitlement'"],"plain_english_summary":"This instrument tells the Repatriation Commission how to treat investments, secured charges and unsecured loans linked to companies or trusts controlled by veterans when assessing assets for Veterans' Entitlements Act payments. It requires transactions to be genuine, arm’s-length and properly documented before any outsider investment or debt can be ignored.\n\nIt affects veterans and their partners, outside investors and lenders, and Commission decision‑makers — aiming to block asset‑hiding while protecting legitimate commercial arrangements."}},"importantCases":[],"_links":{"self":"/api/acts/veterans-entitlements-attribution-of-assets-principles-2025","history":"/api/acts/veterans-entitlements-attribution-of-assets-principles-2025/history","analysis":"/api/acts/veterans-entitlements-attribution-of-assets-principles-2025/analysis","conflicts":"/api/acts/veterans-entitlements-attribution-of-assets-principles-2025/conflicts","importantCases":"/api/acts/veterans-entitlements-attribution-of-assets-principles-2025/important-cases","documents":"/api/acts/veterans-entitlements-attribution-of-assets-principles-2025/documents"}}