Some welcome news for aged care residents and their financial advisers. A legislative amendment has been passed through Parliament to restore flexibility around when a Refundable Accommodation Deposit (RAD) or Refundable Accommodation Contribution (RAC) can be paid from 1 November 2026.
Under the aged care rules introduced last year, residents were unable to pay a RAD/RAC until Services Australia had completed their means-test assessment or issued a means-not-disclosed determination.
This created an unnecessary financial burden for many residents, who were forced to pay the Daily Accommodation Payment (DAP) or Daily Accommodation Contribution (DAC) while waiting for their assessment to be finalised. In some cases, these delays stretched into months.
The good news is that this restriction has been removed from 1 November 2026. This change will apply to all residents, regardless of when they entered aged care.
Residents can once again choose whether to pay all or part of their RAD/RAC from the date they enter permanent residential care, without waiting for Services Australia to complete the MTA assessment.
This is a sensible and welcome change. It puts control back in the hands of residents and allows financial advisers to help clients implement an accommodation payment strategy that best suits their circumstances, rather than having their choices dictated by administrative delays.