Exit entitlements
An exit entitlement is the amount paid back to the resident on exit. For non-owner residents, it starts with the repayable entry payment. For owner residents, it starts with the sale price of the unit. Any fees, outstanding charges and other deductible amounts are subtracted to give the final figure.
When a resident leaves a retirement village, their exit entitlement must be paid by whichever is earlier:
- the date set in the contract
- the date otherwise agreed between the resident and the village operator or proprietor, or
- 12 months after the resident delivers up vacant possession.
For more information about how exit entitlements are calculated, go to Fees and Charges: Leaving a Retirement Village.
Why advance payments may be needed
If a resident’s unit has not been resold or released, the operator may not yet have paid the exit entitlement. This can create a gap if a resident needs to pay for aged care or new accommodation.
The advance payment scheme closes this gap. The operator makes payments on a resident’s behalf directly to their new aged care or accommodation provider, drawn from the unpaid exit entitlement.
Once a resident has made a valid request and all of the conditions set out in the Retirement Villages Act 1986 are met, the operator is legally required to make the payments.
Aged care payments
If a non-owner resident is moving into a residential care facility and has been accepted by that facility, they can request the operator to make aged care payments directly to the facility, drawn from their exit entitlement.
The operator must make these payments on a resident’s behalf if:
- they have submitted a valid request to the operator using the approved form
- they have been accepted by the residential care facility
- the amounts requested are specified in the request form
- the exit entitlement has not already been paid.
How to make a request
Residents must use the approved form to make a request. It must include:
- the name of the residential care facility
- the date they have entered or propose to enter the facility
- the amount of the aged care payment they are requesting.
When the first payment must be made
If a resident has not yet entered the facility: the operator must make the first payment at least 28 days before the proposed entry date, or as soon as practicable if the request was made less than 28 days before entry.
If a resident has already entered the facility: the operator must make the first payment within 28 days of receiving the request, or on the date specified in the request.
Alternative accommodation payments
If a resident has vacated their village premises and moved into a rental property or other accommodation arrangement (that is not a residential care facility), the resident can request the operator make alternative accommodation payments directly to the accommodation provider, drawn from the resident’s exit entitlement.
The operator must make these payments on the resident’s behalf if:
- the resident has submitted a valid request to the operator using the approved form
- the resident has delivered up vacant possession of your village premises and has entered into alternative accommodation that is not a residential care facility
- for owner residents, their premises in the village has not yet been sold
- the amounts and payment dates are specified in the request form
- the exit entitlement has not already been paid.
How to make a request
Residents must use the approved form to make their request. It must include:
- the nature of the accommodation arrangement, for example whether it is an arrangement under the Residential Tenancies Act 1997 or another type of arrangement
- the date that the resident has entered or proposes to enter the arrangement
- the amount of each alternative accommodation payment and the date the first is due
- documents substantiating the arrangement, such as a copy of the rental agreement or an invoice
- banking details for payment
- the name, phone number and email address of the person to receive payment.
For non-owner residents, the operator must provide a written estimate of the unpaid exit entitlement within 14 days of receiving a request.
Download the Request for aged care payments form (Word, 72KB).
When the first payment must be made
If a resident has not yet commenced the accommodation arrangement: the operator must make the first payment at least 28 days before it is proposed to start, or as soon as practicable if the request was made less than 28 days before commencement.
If a resident has already commenced the arrangement: the operator must make the first payment within 28 days of receiving a request, or on the date specified.
How much can be paid
The total advance payments under both schemes are capped at 85% of the operator's reasonable estimate of a resident’s unpaid exit entitlement at the time payments begin. When the exit entitlement is eventually paid, all advance payments already made will be deducted.
When payments stop
The operator's obligation to keep making payments ends when the first of the following occurs:
- for owner residents, the premises in the village is sold
- the resident asks the operator in writing to stop making payments
- the resident dies
- 85% of the estimated unpaid exit entitlement has been paid
- the resident does not take up the aged care place or accommodation arrangement.
When payments stop, the operator must notify the resident and the relevant provider.
Payment statements
Within 7 days of making each payment, the operator must provide a statement setting out:
- the date and time of the resident’s original payment request
- the amount and purpose of the payment
- the date and time it was made
- full details of the recipient, including their name, phone number, email address and role as accommodation or service provider
- details of the account to which it was paid
- an updated estimate of the resident’s remaining unpaid exit entitlement after the payment.
Aged care costs
Aged care accommodation costs are regulated by the Australian Government. For information about what aged care facilities can charge and how accommodation payments work, visit the My Aged Care website.