For a general explanation of how accommodation costs are determined, available payment options and changes effective from 1 November 2025, refer to accommodation costs for residential aged care.
About accommodation bonds and charges
Accommodation bonds and charges are ways residents can pay for their room in an aged care home.
These options apply only to residents who entered care before 1 July 2014 and still are on the pre-1 July 2014 accommodation arrangements.
Residents who entered care on or after 1 July 2014 are on different accommodation arrangements and may pay an accommodation payment or contribution.
When a resident first entered care, their accommodation costs were determined based on an assessment of their assets. They may have been:
- eligible for government support
- required to contribute to their accommodation costs
- a combination of both.
If a resident was not eligible for government support for all of their accommodation costs, they would have paid and may still be paying:
- an accommodation bond – a lump sum payment for low-care residents and residents in extra service places
- a daily accommodation charge – a rental style payment for high-care residents.
Residents transferring to a new aged care home
If a resident is on pre-1 July 2014 accommodation arrangements and transfers to a different aged care home, they can:
- remain on pre-1 July 2014 fee and accommodation arrangements
- choose to opt in to the 1 July 2014 fee and accommodation arrangements, if the transfer occurs before 1 November 2025
- choose to opt in to the 1 November 2025 fee and accommodation arrangements, if the transfer occurs on or after 1 November 2025.
Learn about fee and accommodation arrangements.
If a resident doesn’t opt in to 1 July 2014 or later fee and accommodation arrangements, the new provider must continue using the same type of accommodation payment (bond or charge) they were paying in their previous aged care home.
This means:
- the new provider must collect the same type of payment (bond or charge) as the previous provider
- the resident cannot switch between a bond and a charge
- the bond amount must not exceed the amount refunded from the previous provider
- the 5-year retention period for bonds does not reset
- the charge amount must not exceed what was charged by the previous provider.
Accommodation bonds
Accommodation bonds are lump sum payments made by residents who entered aged care before 1 July 2014, typically in low-care or extra service places.
Bond amount
A resident’s bond amount was agreed when they first entered care. It must not exceed the resident’s total assets, minus the minimum asset amount that applied when the bond was agreed.
Accommodation bond agreement
An accommodation bond agreement outlines how the bond will be managed. This agreement may be included in the resident agreement.
A provider must enter into the agreement before or within 21 days of a resident moving into care.
The agreement must include:
- the resident’s date of entry to the aged care home
- the bond amount agreed between the provider and the resident
- payment arrangements, including whether the bond will be paid in full or in part through periodic payments
- how periodic payments will be calculated
- any retention amounts to be deducted from the bond balance
- whether paying the bond entitles the resident to specific accommodation or additional services
- the interest rate the resident must pay if they don’t pay the bond upfront
- any financial hardship provisions that apply.
Bond payment options
A resident can pay a bond:
- as a lump sum
- through periodic payments for some or all of the bond.
If a resident pays by periodic payments, interest must be included in each payment. The interest rate must be equal to or less than the maximum permissible interest rate (MPIR) that applies on the day the resident enters the aged care home.
Maximum monthly bond retention amounts
The government sets the maximum monthly accommodation bond retention amount, which is capped based on the size of the bond. This cap is updated each year in line with the Consumer Price Index (CPI).
Once set, a resident’s retention amount does not change while they remain in an aged care home.
Maximum monthly bond retention amounts are listed in the Schedule of fees and charges for pre-1 July 2014 residential and home care recipients.
Bond retention deductions
Retention amounts may be:
- deducted from the bond balance, or
- included in periodic payments.
Retention amounts can be deducted for a maximum of 5 years from the date the resident first became a permanent resident, unless:
- the aged care home was not certified on that day – the 5-year period starts from the date of certification
- a financial hardship determination was in place – the 5-year period starts the day after the determination ends
- the resident transferred from respite care – the 5-year period starts from the date of transfer.
Retention amounts must be agreed between the provider and the resident, and must not exceed the maximum monthly retention amount.
If a resident chooses to pay some of the bond as a lump sum, the maximum monthly retention amount applies to the total bond.
Bond refunds
The provider must refund the accommodation bond balance when the resident permanently leaves the aged care home.
Deducting fees from bonds
Before refunding a resident’s bond balance, the provider may deduct:
- amounts owed under the resident’s accommodation bond agreement, resident agreement or extra services agreement
- interest on those amounts
- retention amounts.
Interest on amounts owed is calculated from one month and one day after the fee was due.
Example – If an amount was payable on 1 July 2024, interest begins accruing from 2 August 2024. It continues until the amount is paid or the resident leaves the aged care home, whichever occurs first.
Interest equivalent on unpaid bonds
If a resident agreed to pay an accommodation bond but left an aged care home without paying it, the provider can charge interest equivalent – the amount that could have been earned if the bond had been paid as a lump sum.
Details on how to calculate the interest equivalent are set in:
- Aged Care (Transitional Provisions) Principles 2014
- Aged Care Rules under the Aged Care Act 2024.
Accommodation charges
Accommodation charges are daily payments made by residents who entered aged care before 1 July 2014, typically in high-care settings.
Charge amount
A resident’s accommodation charge was determined based on the value of their assets when they first entered care.
A resident who entered care before 2004 may pay an accommodation charge for up to 5 years. This 5-year limit does not apply to residents who entered care between 1 July 2004 and 1 July 2014.
A provider can ask a resident to pay an accommodation charge no more than one month in advance.
Accommodation charge agreement
An accommodation charge agreement outlines how the charge will be managed. This agreement may be included in the resident agreement.
A resident must agree on accommodation charge details within 21 days of entering an aged care home.
An accommodation charge agreement must include:
- the resident’s date of entry to the aged care home
- the bond amount agreed between the provider and the resident
- when charges are payable
- the interest charged on late payments
- whether the accommodation charge entitles the resident to specific accommodation or additional services.
If a resident has a financial hardship determination, they may pay less than the agreed daily amount.
Bonds and charges for residents moving homes
These requirements apply to residents who entered care before 1 July 2014 and are transferring from another aged care home.
If a resident previously paid an accommodation charge
If a resident previously paid an accommodation charge, their new provider must not charge more than the rate payable at their previous aged care home.
The resident may pay less if they have a current asset assessment on the day they enter the new aged care home.
If a resident previously paid an accommodation bond
If a resident previously paid an accommodation bond, their new provider must not charge more than the bond amount refunded from their previous aged care home.
The resident may pay less if they have a current asset assessment on the day they enter the new aged care home.
If a resident has a break in care
If a resident has a break in care of more than 28 days, their fee and accommodation arrangements may change depending on when the break occurs:
- if the break starts on or after 1 November 2025, they will retain their pre-1 July 2014 fee and accommodation arrangements
- if the break occurs entirely before 1 November 2025, they will move on to the 1 July 2014 fee and accommodation arrangements
- if the break starts before 1 November 2025 and includes being out of care on 1 November 2025, they will move on to the 1 July 2014 fee and accommodation arrangements.
Other considerations
A provider may be eligible for an accommodation supplement, depending on the resident’s asset assessment on the day they enter the aged care home.
Residents can contact Services Australia for advice about updating their asset information.
The bond or charge amount is set on the day the resident enters care and generally does not change while they remain in the same aged care home.