{"id":"F2025L00273","name":"Veterans’ Entitlements (Modification of Asset Deprivation Rules) Principles 2025","slug":"veterans-entitlements-modification-of-asset-deprivation-rules-principles-2025","collection":"legislative_instrument","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":null,"makingDate":null,"administeringDepartment":null,"currentVersion":{"id":106095,"registerId":"commonwealth-F2025L00273-current","compilationNumber":null,"startDate":"2026-04-03","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"Part 1","sectionType":"part","heading":"Preliminary","content":"## Part 1 Preliminary\n\n1 Name\n\nThis instrument is the Veterans’ Entitlements (Modification of Asset Deprivation Rules) Principles 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 the paragraphs 52ZZZQ(f) and (g) of the Veterans’ Entitlements Act 1986.\n\n3A Repeal\n\nSchedule 5 to the Veterans’ Affairs (Legislative Instrument Re-making Exercise) Instrument 2014 is repealed.\n\n4 Definitions\n\n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> Note: Commission\n\n> Note: member of a couple\n\nIn this instrument:\n\n> Act means the Veterans’ Entitlements Act 1986.\n\n> asset disposal provisions means Subdivision B of Division 11 of Part IIIB and section 45UT of the Act.","sortOrder":0},{"sectionNumber":"Part 2","sectionType":"part","heading":"Disposal of asset (on or after 1 January 2002) by individual","content":"## Part 2 Disposal of asset (on or after 1 January 2002) by individual\n\n5 Purpose of Part 2\n\nThis Part sets out decision-making principles with which the Commission must comply in making a determination for subsection 52ZZW(1) of the Act.\n\n6 Definitions\n\nIn this Part:\n\n> individual means an individual who transfers property to a company or trust in accordance with subsection 52ZZWB(1) of the Act.\n\n> transfer of property means a transfer of property by way of capital contribution.\n\n7 Transferor as sole attributable stakeholder\n\n1.  This section applies to an individual who is not a member of a couple.\n2.  The Commission must take into account whether the individual was the only attributable stakeholder of the company or trust, either before or after the transfer.\n\n8 Transferor as member of couple\n\n1.  This section applies to an individual who is a member of a couple.\n2.  The Commission must take into account whether:\n\n1.  the individual was the only attributable stakeholder of the company or trust, either before or after the transfer; or\n2.  both members of the couple were the only attributable stakeholders of the company or trust, either before or after the transfer.\n\n9 Transfer to company or trust with 2 or more attributable stakeholders\n\n1.  This section applies if, in relation to a transfer of property to a company or trust:\n\n1.  the transfer is made by an attributable stakeholder of the company or trust; and\n2.  before the transfer, there were 2 or more attributable stakeholders of the company or trust.\n\n1.  This section also applies if, in relation to a transfer of property to a company or trust:\n\n1.  the transfer is made by an attributable stakeholder of the company or trust; and\n2.  after the transfer, there were 2 or more attributable stakeholders of the company or trust.\n\n1.  The Commission must take into account the income attribution percentage of each attributable stakeholder of the company or trust, before and after the transfer of the property.\n\n10 Transfer to company or trust by individual who becomes attributable stakeholder\n\n1.  This section applies if, in relation to a transfer of property to a company or a trust:\n\n1.  the transfer is made by an individual who is not an attributable stakeholder of the company or trust; and\n2.  as a result of the transfer, the individual is an attributable stakeholder.\n\n1.  The Commission must take into account the asset attribution percentage of each attributable stakeholder of the company or trust, before and after the transfer of the property.","sortOrder":1},{"sectionNumber":"Part 3","sectionType":"part","heading":"Disposal of asset (on or after 1 January 2002) by company or trust","content":"## Part 3 Disposal of asset (on or after 1 January 2002) by company or trust\n\n11 Purpose of Part 3\n\nThis Part sets out decision-making principles with which the Commission must comply in making a determination for subsection 52ZZX(3) of the Act.\n\n12 Disposal to individual by company or trust\n\n1.  This section applies if:\n\n1.  a company pays a dividend to an individual who is an attributable stakeholder of the company; and\n2.  the asset disposal provisions apply, and are taken to have applied, as if the individual had disposed of an asset of the individual.\n\n1.  This section also applies if:\n\n1.  a trust makes a distribution to an individual who is an attributable stakeholder of the trust; and\n2.  the asset disposal provisions apply, and are taken to have applied, as if the individual had disposed of an asset of the individual.\n\n1.  The Commission must consider whether the amount of the dividend or the value of the distribution is reasonable, having regard to the individual’s asset attribution percentage, in relation to the company or trust, before and after the disposal of the asset.\n\n13 Disposal by way of dividend or distribution to genuine investor\n\n1.  This section applies if:\n\n1.  during a derivation period of a company, the company pays a dividend to an individual who is not an attributable stakeholder of the company; and\n2.  the individual has, before or during the derivation period, made a genuine transfer of capital to the company.\n\n1.  This section also applies if:\n\n1.  during a derivation period of a trust, the trust makes a distribution to an individual who is not an attributable stakeholder of the trust; and\n2.  the individual has, before or during the derivation period, made a genuine transfer of capital to the trust.\n\n1.  For subsections (1) and (2), a transfer of capital is a genuine transfer of capital if:\n\n1.  the individual 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\n2.  the individual has a legal or equitable right to a share of the capital on the winding-up of the company or trust; and\n3.  the individual has a legal or equitable right to receive dividends or distributions in accordance with the constituent documents of the company or under the terms of the trust; and\n4.  the individual is over 18 years.\n\n1.  The Commission must consider whether the amount of the dividend or the value of the distribution is reasonable, having regard to the proportion of the value of the capital transferred by the individual to the total value of the assets owned by the company or trust at the time of the transfer.","sortOrder":2},{"sectionNumber":"Part 4","sectionType":"part","heading":"Disposal of asset (before 1 January 2002) by attributable stakeholder","content":"## Part 4 Disposal of asset (before 1 January 2002) by attributable stakeholder\n\n14 Purpose of Part 4\n\nThis Part sets out decision-making principles with which the Commission must comply in making a determination for subsection 52ZZZ(1) of the Act.\n\n15 Definitions\n\nIn this Part:\n\n> individual means an individual who transfers property to a company or trust in accordance with subsection 52ZZZ(1) of the Act.\n\n16 Application of asset disposal provisions where value of asset same or greater\n\n1.  This section applies if:\n\n1.  an asset is disposed by an individual to a company or trust; and\n2.  on 1 January 2002, the asset is owned by the company or trust; and\n3.  on 1 January 2002, the value of the asset is the same as, or greater than, it was at the time of its disposal.\n\n1.  The Commission must consider whether, in all the circumstances, the application of the asset disposal provisions would be unfair or unreasonable in relation to the individual.\n\n17 Application of asset disposal provisions where value of asset decreased after disposal\n\n1.  This section applies if:\n\n1.  an asset is disposed of by an individual to a company or trust; and\n2.  on 1 January 2002, the asset is owned by the company or trust; and\n3.  on 1 January 2002, the value of the asset is less than it was at the time of its disposal; and\n4.  the decrease in the value of the asset is not attributable to any conduct that the Commission reasonably believes was intended to avoid the operation, or minimise the effect, of Division 11A of Part IIIB of the Act.\n\n1.  The Commission must consider whether, in all the circumstances, the application of the asset disposal provisions would be unfair or unreasonable in relation to the individual.\n\n18 Application of asset disposal provisions where company or trust retains value of transferred asset\n\n1.  This section applies if:\n\n1.  an asset is disposed of by an individual to a company or trust; and\n2.  before 1 January 2002, the company or trust transferred the asset to another individual or other entity in consideration of an arm’s length amount; and\n3.  the company or trust retained the amount or value of the consideration.\n\n1.  The Commission must consider whether, in all the circumstances, the application of the asset disposal provisions would be unfair or unreasonable in relation to the individual.\n\n19 Transfer by member of couple\n\n1.  This section applies if:\n\n1.  an individual, who is a member of a couple, disposes of an asset to a company or trust before 1 January 2002; and\n2.  as a result of the transfer:\n\n1.  the individual is the only attributable stakeholder, on 1 January 2002, of the company or trust; or\n2.  both members of the couple are the only attributable stakeholders, on 1 January 2002, of the company or trust.\n\n1.  The Commission must consider whether, in all the circumstances, the application of the asset disposal provisions would be unfair or unreasonable in relation to the individual.","sortOrder":3},{"sectionNumber":"Part 5","sectionType":"part","heading":"Disposal of asset (before 1 January 2002) by individual whose spouse is attributable stakeholder","content":"## Part 5 Disposal of asset (before 1 January 2002) by individual whose spouse is attributable stakeholder\n\n20 Purpose of Part 5\n\nThis Part sets out decision-making principles with which the Commission must comply in making a determination for subsection 52ZZZA(1) of the Act.\n\n21 Definitions\n\nIn this Part:\n\nindividual means an individual who transfers property to a company or trust in accordance with subsection 52ZZZA(1) of the Act.\n\n22 Application of asset disposal provisions where value of asset same or greater\n\n1.  This section applies if:\n\n1.  an asset is disposed of by an individual to a company or trust; and\n2.  on 1 January 2002, the asset is owned by the company or trust; and\n3.  on 1 January 2002, the value of the asset is the same as, or greater than, it was at the time of its disposal.\n\n1.  The Commission must consider whether, in all the circumstances, the application of the asset disposal provisions would be unfair or unreasonable in relation to the individual.\n\n23 Application of asset disposal provisions where value of asset decreased after disposal\n\n1.  This section applies if:\n\n1.  an asset is disposed of by an individual to a company or trust; and\n2.  on 1 January 2002, the asset is owned by the company or trust; and\n3.  on 1 January 2002, the value of the asset is less than it was at the time of its disposal; and\n4.  the decrease in the value of the asset is not attributable to any conduct that the Commission reasonably believes was intended to avoid the operation, or minimise the effect, of Division 11A of Part IIIB of the Act.\n\n1.  The Commission must consider whether, in all the circumstances, the application of the asset disposal provisions would be unfair or unreasonable in relation to the individual.\n\n24 Application of asset disposal provisions where company or trust retains value of transferred asset\n\n1.  This section applies if:\n\n1.  an asset is disposed of by an individual to a company or trust; and\n2.  before 1 January 2002, the company or trust transferred the asset to another individual or other entity in consideration of an arm’s length amount; and\n3.  the company or trust retained the amount or value of the consideration.\n\n1.  The Commission must consider whether, in all the circumstances, the application of the asset disposal provisions would be unfair or unreasonable in relation to the individual.","sortOrder":4}],"analysis":{"flash_summary_failed":{"failed":true,"reason":"A positive credit balance is required for all requests, including BYOK, so fallback providers remain available. Add credits at https://vercel.com/d?to=%2F%5Bteam%5D%2F%7E%2Fai%3Fmodal%3Dtop-up to continue.","source":"analysis-cron"},"kimi_summary":{"content_quality":"ok","complexity_score":6,"scope_assessment":{"changed":false,"description":"This is a legislative instrument remaking exercise that repeals and replaces Schedule 5 to the 2014 instrument. It appears to maintain the same scope as its predecessor, continuing the framework for modifying asset deprivation rules for veterans' entitlements. The structure and content suggest it is a consolidation or re-enactment of existing principles rather than an expansion into new policy areas."},"complexity_factors":["Heavy reliance on defined terms from the parent Act (Veterans' Entitlements Act 1986) including 'attributable stakeholder', 'asset attribution percentage', 'income attribution percentage', and 'asset disposal provisions'","Complex temporal division between pre-1 January 2002 and post-1 January 2002 transfers requiring different analytical frameworks","Nested conditional logic with multiple prerequisites for each section (e.g., sections 9, 10, 12, 13 have 2-4 cumulative conditions)","Cross-references to specific subsections of the Act (52ZZW, 52ZZWB, 52ZZX, 52ZZZ, 52ZZZA) without reproducing their content","Technical concepts requiring financial/legal literacy: 'arm's length amount', 'derivation period', 'constituent documents', 'genuine transfer of capital'","Parallel structure between Parts 4 and 5 with nearly identical sections (16/22, 17/23, 18/24) creating redundancy but requiring careful distinction of scope","Subjective discretionary standards ('unfair or unreasonable', 'reasonable') requiring case-by-case assessment rather than bright-line rules"],"plain_english_summary":"This instrument gives the Department of Veterans’ Affairs rules for when to treat transfers to companies or trusts as “asset deprivation” when deciding pension and benefit eligibility. It guides when transferred assets or payments should still count for assessing entitlement, balancing prevention of artificial means-testing with flexibility for genuine business or family arrangements. It affects veterans and their partners who have placed assets into private companies or trusts and seek income support."},"flash_summary":{"complexity_score":7,"scope_assessment":{"changed":true,"description":"The instrument explicitly repeals Schedule 5 of the 2014 re-making instrument (s3A) and replaces that prior guidance with new decision-making principles. It therefore changes administrative scope by prescribing how the Commission must assess disposals under multiple subsections of the Act (Parts 2–5) — specifying factors to consider (attribution percentages, genuine capital tests, whether application would be ‘unfair or unreasonable’) and clarifying treatment across pre- and post‑2002 disposals, couples, and company/trust transactions."},"complexity_factors":["Multiple cross-references to the Veterans’ Entitlements Act (notably subsections 52ZZW(1), 52ZZX(3), 52ZZZ(1), 52ZZZA(1)) increasing interpretive dependence on the Act (see s3 and Parts 2–5).","Temporal distinctions (disposals on or after 1 January 2002 versus before 1 January 2002) create parallel rule sets and different evidentiary inquiries (Parts 2–5).","Different legal actors and statuses—individuals, members of a couple, companies, trusts, attributable stakeholders and genuine investors—require distinct factual inquiries (see ss7–13, 16–19, 22–24).","Use of percentage-based concepts (asset attribution percentage, income attribution percentage) introduces quantitative assessment without prescribing formulas (ss9–10, 12–13).","A multi-part ‘genuine transfer of capital’ test with four substantive criteria (s13(3)) adds layered factual and documentary proof requirements for investors.","Repeated open-ended standards obliging the Commission to ‘take into account’ or ‘consider whether … unfair or unreasonable’ leave substantial administrative discretion and case-by-case judgment (e.g. ss6, 11, 16–19, 22–24).","Repeal of previous instrument Schedule 5 (s3A) changes prior administrative guidance and requires practitioners to map old to new principles.","Interplay with the asset disposal provisions (Subdivision B of Division 11 of Part IIIB and s45UT) means outcomes depend on applying both the Act and these principles, increasing combined statutory complexity (definition of 'asset disposal provisions')."],"plain_english_summary":"This instrument repeals the prior Schedule 5 and sets new decision-making principles the Repatriation Commission must use under the Veterans’ Entitlements Act to decide when transfers, dividends or distributions involving companies or trusts count as asset disposals (covering events before and after 1 January 2002). It affects veterans and their partners, companies, trusts and third‑party investors because it prescribes which attribution percentages, evidence of genuine capital, and fairness/reasonableness factors the Commission must consider when applying asset‑deprivation rules."}},"importantCases":[],"_links":{"self":"/api/acts/veterans-entitlements-modification-of-asset-deprivation-rules-principles-2025","history":"/api/acts/veterans-entitlements-modification-of-asset-deprivation-rules-principles-2025/history","analysis":"/api/acts/veterans-entitlements-modification-of-asset-deprivation-rules-principles-2025/analysis","conflicts":"/api/acts/veterans-entitlements-modification-of-asset-deprivation-rules-principles-2025/conflicts","importantCases":"/api/acts/veterans-entitlements-modification-of-asset-deprivation-rules-principles-2025/important-cases","documents":"/api/acts/veterans-entitlements-modification-of-asset-deprivation-rules-principles-2025/documents"}}