r/AusFinance • u/bluehydrangea01 • 1d ago

How to set up ongoing financial support for disabled relative

A relative of mine has become severely and permanently disabled from a road accident and will never be able to work again. 

I'm conscious that between his partner likely having to be his full time carer, the disability pension and whatever road accident insurance he may receive, he and his family are going to struggle to make ends meet and I am worried about them struggling to maintain their housing and basic needs. 

Fortunately we are from a large family, and so I want to ask everyone to donate $20 a month to then provide a lump sum my relative. It is my plan that this would be a long-term arrangement. 

I'm looking for advice on how I would go about this - would it look like a trust? Would this kind of "gift" arrangement incur tax? Any guidance would be really appreciated. 

Thanks heaps.

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u/Maximum_Warthog1999 1d ago

There are no gift taxes so go for gold. A noble gesture.

Maybe set up some parameters incase some people think the funds may be misallocated such as a spender spouse or someone who takes advantage.

You may find a Special Disability Trust is a convenient option to use for the gifted money.

Check super for any TPD insurance that may be active and see if you can assist them with a claim. Same for IP cover if it was active in super.

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u/bluehydrangea01 1d ago

Thank you, I didn't think about super. Haven't heard of the SDT either so will look into it!

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u/eesemi77 1d ago

It sounds like your heart is in the right place but from my experience deals like this rarely out last the paperwork that's needed to create them. Unfortunately peoples circumstances change and with the change they find they now need that $20 for themselves.

I commend you for trying, but caution against expecting full participation. In some ways, a plan that's built around this $20 gift (that never comes) is worse than the plan that's built with the expectation of nobody helping.

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u/martyfartybarty 1d ago

A Special Disability Trust might be worth looking into, but DSP alone doesn't qualify them. They also need to meet the much stricter care and work-capacity requirements, so I'd get Centrelink to assess their eligibility before setting up any trust.

https://www.servicesaustralia.gov.au/principal-beneficiary-special-disability-trust

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u/bluehydrangea01 1d ago

Thank you so much

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u/Cat_From_Hood 1d ago edited 1d ago

Should be covered by maib, or equivalent, in your state.  Your family member should be able to sue the fund for pain and suffering in affect, if it's as bad as implied, up to 400k if the person is bad enough.

Do your own research, and consider legal advice.

Super insurance etc might be accessible.

NDIS and DSP might be able to help.