{"id":"F2025L00269","name":"Veterans' Entitlements (Modification of Income Deprivation Rules) Principles 2025","slug":"veterans-entitlements-modification-of-income-deprivation-rules-principles-2025","collection":"legislative_instrument","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":null,"makingDate":null,"administeringDepartment":null,"currentVersion":{"id":106090,"registerId":"commonwealth-F2025L00269-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 Income 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 paragraphs 52ZZZQ(h) and (i) of the Veterans’ Entitlements Act 1986.\n\n3A Repeal\n\nSchedule 6 to the Veterans’ Affairs (Legislative Instrument Re-making Exercise) Instrument 2014 is repealed.\n\n4 Definitions\n\n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.","sortOrder":0},{"sectionNumber":"Part 2","sectionType":"part","heading":"Disposal of ordinary income (on or after 1 January 2002) by individual","content":"## Part 2 Disposal of ordinary income (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 52ZZZB(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 52ZZZB(1) of the Act.\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 recipient company or recipient 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 income 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 ordinary income (on or after 1 January 2002) by company or trust","content":"## Part 3 Disposal of ordinary income (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 52ZZZC(3) of the Act.\n\n12 Disposal to attributable stakeholder\n\nThe Commission must take into account whether, in relation to a transfer of ordinary income of a company or trust in accordance with subsection 52ZZZC(1) of the Act, the transfer is to an individual who is an attributable stakeholder of the company or trust.","sortOrder":2},{"sectionNumber":"Part 4","sectionType":"part","heading":"Disposal of ordinary income (before 1 January 2002) by attributable stakeholder","content":"## Part 4 Disposal of ordinary income (before 1 January 2002) by attributable stakeholder\n\n13 Purpose of Part 4\n\nThis Part sets out decision-making principles with which the Commission must comply in making a determination for subsection 52ZZZD(1) of the Act.\n\n14 Definitions\n\nIn this Part:\n\n> individual means an individual who transfers property to a company or trust in accordance with subsection 52ZZZD(1) of the Act.\n\n15 Application of Division 7 of Part IIIB of Act where value of property same or greater\n\n1.  This section applies if:\n\n1.  property is transferred by an individual to a company or trust; and\n2.  on 1 January 2002, the property is owned or controlled by the company or trust; and\n3.  on 1 January 2002, the value of the property is the same as, or greater than, it was at the time of its transfer.\n\n1.  The Commission must consider whether, in all the circumstances, the application of Division 7 of Part IIIB of the Act would be unfair or unreasonable in relation to the individual.\n\n16 Application of Division 7 of Part IIIB of Act where value of property decreased after transfer\n\n1.  This section applies if:\n\n1.  property is transferred by an individual to a company or trust; and\n2.  on 1 January 2002, the property is owned or controlled by the company or trust; and\n3.  on 1 January 2002, the value of the property is less than it was at the time of its transfer; and\n4.  the decrease in the value of the property 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 Division 7 of Part IIIB of the Act would be unfair or unreasonable in relation to the individual.\n\n17 Application of Division 7 of Part IIIB of Act where company or trust retains value of transferred property\n\n1.  This section applies if:\n\n1.  property is transferred by an individual to a company or trust; and\n2.  before 1 January 2002, the company or trust transferred the property 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 Division 7 of Part IIIB of the Act would be unfair or unreasonable in relation to the individual.\n\n18 Transfer by member of couple\n\n1.  This section applies if:\n\n1.  an individual, who is a member of a couple, transfers property 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 Division 7 of Part IIIB of the Act would be unfair or unreasonable in relation to the individual.","sortOrder":3},{"sectionNumber":"Part 5","sectionType":"part","heading":"Disposal of ordinary income (before 1 January 2002) by individual whose spouse is attributable stakeholder","content":"## Part 5 Disposal of ordinary income (before 1 January 2002) by individual whose spouse is attributable stakeholder\n\n19 Purpose of Part 5\n\nThis Part sets out decision-making principles with which the Commission must comply in making a determination for subsection 52ZZZE(1) of the Act.\n\n20 Definitions\n\nIn this Part:\n\nindividual means an individual who transfers property to a company or trust in accordance with subsection 52ZZZE(1) of the Act.\n\n21 Application of Division 7 of Part IIIB of Act where value of property same or greater\n\n1.  This section applies if:\n\n1.  property is transferred by an individual to a company or trust; and\n2.  on 1 January 2002, the property is owned or controlled by the company or trust; and\n3.  on 1 January 2002, the value of the property is the same as, or greater than, it was at the time of its transfer.\n\n1.  The Commission must consider whether, in all the circumstances, the application of Division 7 of Part IIIB of the Act would be unfair or unreasonable in relation to the individual.\n\n22 Application of Division 7 of Part IIIB of Act where value of property decreased after disposal\n\n1.  This section applies if:\n\n1.  property is transferred by an individual to a company or trust; and\n2.  on 1 January 2002, the property is owned or controlled by the company or trust; and\n3.  on 1 January 2002, the value of the property is less than it was at the time of its transfer; and\n4.  the decrease in the value of the property 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 Division 7 of Part IIIB of the Act would be unfair or unreasonable in relation to the individual.\n\n23 Application of Division 7 of Part IIIB of Act where company or trust retains value of transferred property\n\n1.  This section applies if:\n\n1.  property is transferred by an individual to a company or trust; and\n2.  before 1 January 2002, the company or trust transferred the property 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 Division 7 of Part IIIB of the Act would be unfair or unreasonable in relation to the individual.","sortOrder":4}],"analysis":{"kimi_summary":{"content_quality":"ok","complexity_score":6,"scope_assessment":{"changed":false,"description":"This instrument appears to be a straightforward re-making of existing principles (noting the repeal of Schedule 6 to the 2014 Legislative Instrument Re-making Exercise instrument). It maintains the same scope as its predecessors: providing decision-making principles for income deprivation rules affecting veterans' pensions. The temporal split (pre/post 2002) and focus on company/trust structures suggests it was always intended to address complex asset structuring arrangements, and this version does not appear to expand beyond that original purpose."},"complexity_factors":["Heavy reliance on defined terms from the parent Act (Veterans' Entitlements Act 1986) including 'attributable stakeholder', 'member of a couple', and 'Commission' without full definitions in this instrument","Temporal bifurcation: separate rule sets for transfers before and after 1 January 2002, creating parallel but slightly different assessment frameworks","Cross-referencing to multiple divisions and sections of the parent Act (Divisions 7 and 11A of Part IIIB, sections 52ZZZB, 52ZZZC, 52ZZZD, 52ZZZE)","Conditional logic requiring assessment of property values at specific historical dates (1 January 2002)","Subjective fairness tests: multiple sections require the Commission to determine whether application of rules would be 'unfair or unreasonable'—open-textured standards requiring discretionary judgment","Structural complexity: five distinct parts addressing subtly different scenarios (individual transfers, couple transfers, company/trust transfers, pre-2002 vs post-2002)","Cumulative conditions in sections 15-18 and 21-23 requiring multiple factual predicates to be satisfied before the fairness test applies"],"plain_english_summary":"These rules tell the Department of Veterans' Affairs how to decide when a veteran has given away income or assets (via companies or trusts) in a way that should still count against their pension eligibility. They apply to transfers before and after 1 January 2002, focus on who really controls or benefits from the assets, and affect veterans, their partners, and the Commission. The aim is to prevent gaming of the pension system and keep payments fair."},"flash_summary":{"complexity_score":6,"scope_assessment":{"changed":true,"description":"This instrument repeals Schedule 6 of the 2014 re‑making instrument (s3A) and replaces it with a set of decision-making principles that the Commission must follow when applying specified subsections of the Act (see ss5, 11, 13, 19). Who decides: the Commission applies these principles (see ss5,11,13,19). Who pays/experiences effects: individuals, couples, and entities that transferred property or receive company/trust income — the treatment of those transfers will affect how income is attributed for veterans’ means-testing (Parts 2–5). Incentives and behavioural effects implicit in the instrument: attribution percentages and stakeholder status are determinative (ss9–10, 12), and the Commission must examine valuation changes and arm’s‑length dealings (ss15–17, 21–23), which could influence how transfers are structured. Compliance burden: claimants or entities will need to provide valuation evidence, records of transfer timing and parties, and documentation of attribution percentages to satisfy the Commission’s enquiries (see ss9–10, 15–17, 21–23). Discretion and implementation risk: many provisions use the Commission’s evaluative judgment—‘take into account’ and ‘consider whether … unfair or unreasonable’—which vests significant interpretive discretion in the Commission and may increase case-by-case variability (ss7–10, 12, 15–18, 21–23)."},"complexity_factors":["Multiple cross-references to the Veterans’ Entitlements Act 1986 and specific subsections that create dependency on external law (see ss3, 5, 11, 13, 19).","Temporal distinctions centred on 1 January 2002 produce different tests for disposals before vs after that date (Parts 2–5 and ss15–17, 21–23).","Different factual branches depending on individual vs couple status (ss7–8, 18).","Treatment varies with number and income-attribution percentages of attributable stakeholders (ss9–10, 12).","Use of open-ended, subjective standards—‘must consider whether … would be unfair or unreasonable’—creates significant administrative discretion (ss15–17, 21–23, 18).","Reliance on valuation questions (same/greater, decreased value, arm’s length consideration) that require evidentiary proof and factual enquiries (ss15–17, 21–23).","Repeal of prior Schedule 6 (s3A) means practitioners must compare new principles against the previous instrument to spot substantive shifts.","Key definitions are located in the Act rather than the instrument, increasing interpretive complexity (s4)."],"plain_english_summary":"This instrument prescribes how the Repatriation Commission must decide whether transfers of property or company/trust income count as a veteran’s income for means-testing. It covers individuals, couples, companies and trusts and distinguishes transfers before and after 1 January 2002. It also repeals Schedule 6 of the 2014 re‑making instrument (s3A)."},"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"}},"importantCases":[],"_links":{"self":"/api/acts/veterans-entitlements-modification-of-income-deprivation-rules-principles-2025","history":"/api/acts/veterans-entitlements-modification-of-income-deprivation-rules-principles-2025/history","analysis":"/api/acts/veterans-entitlements-modification-of-income-deprivation-rules-principles-2025/analysis","conflicts":"/api/acts/veterans-entitlements-modification-of-income-deprivation-rules-principles-2025/conflicts","importantCases":"/api/acts/veterans-entitlements-modification-of-income-deprivation-rules-principles-2025/important-cases","documents":"/api/acts/veterans-entitlements-modification-of-income-deprivation-rules-principles-2025/documents"}}