Aged Care Contract Review
Moving into a retirement village, residential aged care facility or accepting a home care package is one of the most significant — and most expensive — decisions a family will ever make. Our Bondi-based solicitors provide independent, fixed-fee review of aged care and retirement village contracts so you understand the costs, the obligations, and the exit terms before you sign.
Why independent legal advice matters
Aged care and retirement village contracts are among the most legally complex consumer agreements in Australia. They commonly involve:
- Entry payments of $300,000 to over $2 million
- Ongoing daily, monthly and means-tested fees
- Deferred management fees (DMFs) — sometimes 30–40% of your ingoing contribution
- Reinstatement and refurbishment obligations on exit
- Restrictions on resale, capital gain or capital loss sharing
- Different rules depending on whether the facility is a retirement village, residential aged care home or a home care provider
The financial impact of misunderstanding a single clause can be six figures. Getting independent advice before you sign — not after — is essential.
The three regimes — and why it matters which one applies
"Aged care" in Australia is not one body of law. Three distinct legal frameworks apply depending on the type of facility or service:
1. Retirement villages
Independent living units, serviced apartments and lifestyle communities are governed by the Retirement Villages Act 1999 (NSW) and the Retirement Villages Regulation 2017. Key features:
- Mandatory General Inquiry Document and Disclosure Statement before signing
- Statutory 14-day cooling-off period after signing the contract
- Strict rules on departure fees (DMF) and recurrent charges after a resident leaves
- The Asset Management Plan and capital maintenance obligations
- NSW Civil and Administrative Tribunal (NCAT) jurisdiction for disputes
2. Residential aged care
Federally funded residential aged care homes are governed by the Aged Care Act 2024 (Cth) (which commenced 1 July 2025, replacing the Aged Care Act 1997). Costs are structured around:
- Refundable Accommodation Deposit (RAD) — lump-sum accommodation payment, refundable on exit
- Daily Accommodation Payment (DAP) — daily equivalent of the RAD (or a combination of both)
- Basic daily fee — set at 85% of the single age pension
- Means-tested care fee — income- and asset-tested contribution
- Additional services fees — for premium amenities
3. Home care and the new Support at Home program
Home care packages and the new Support at Home program (which commenced 1 July 2025 under the Aged Care Act 2024) are also governed federally. Home care agreements set out service fees, daily fees, exit amounts and unspent contributions — all of which need careful review.
What we review in your contract
Every aged care and retirement village contract is different, but our review typically covers:
- Ingoing contribution and how it is calculated
- Departure fee / deferred management fee structure
- Capital gain and capital loss sharing arrangements
- Recurrent charges after the resident leaves
- Reinstatement and refurbishment obligations on exit
- Resale procedure and any restrictions or marketing fees
- Refund timing — when you actually get your money back
- Service and amenities — what is included vs. extra
- Termination and dispute resolution mechanisms
- Interaction with your Will and estate plan
How we work — fixed fee, plain language
We offer fixed-fee reviews wherever possible, so you know exactly what you'll pay before we begin. Our process is straightforward:
- Send us the contract — including all schedules, disclosure statements and any side correspondence
- Free 30-minute consultation — we discuss your situation and confirm a fixed fee for the review
- Written advice within 3–5 business days — explaining the key terms, costs, risks and any clauses we recommend negotiating
- Negotiation and liaison — where appropriate, we liaise directly with the facility's solicitor to seek amendments
Estate planning considerations
Entering aged care or a retirement village often triggers a need to update your broader estate plan. We can advise on how the contract interacts with:
- Your Will — including whether the refundable amount forms part of your estate
- Enduring Powers of Attorney and Enduring Guardianship — particularly important if cognitive decline is a possibility
- Family probate and estate administration planning
- Pension and means-tested care fee planning (in conjunction with your financial adviser)
Frequently asked questions
What's the difference between a retirement village and aged care?
Retirement villages offer independent living in a community setting (units, serviced apartments) and are governed by the Retirement Villages Act 1999 (NSW). Residential aged care provides personal and clinical care in a regulated facility under the Aged Care Act 2024 (Cth). Many people move from a retirement village into residential aged care later in life, and the contracts and refunds operate very differently.
What is a Refundable Accommodation Deposit (RAD)?
The RAD is a lump-sum payment for accommodation in a residential aged care home. It is refundable to you or your estate when you leave (or pass away), less any agreed deductions, and is government-guaranteed under the Aged Care Act 2024 (Cth). You can choose to pay a daily equivalent (Daily Accommodation Payment or DAP) instead, or a combination of RAD and DAP.
What is a departure fee or deferred management fee (DMF)?
In a retirement village, the DMF is the amount the operator deducts from your ingoing contribution when you leave. It typically accrues over time (commonly 3–4% per year, capped at 30–40%). Understanding how the DMF is calculated, when it stops accruing and how it interacts with capital gain/loss sharing is critical before signing.
Is there a cooling-off period?
Yes — under the Retirement Villages Act 1999 (NSW), you have 14 days from signing the contract to rescind without penalty (excluding any actual costs incurred by the operator). For residential aged care, no statutory cooling-off applies, so getting advice before signing is essential.
How long does it take to get my deposit back when I leave?
For residential aged care, the RAD must generally be refunded within 14 days if the resident leaves (or within 14 days of probate being granted if the resident has passed away), with interest accruing under the legislation. For retirement villages, refund timing depends on the contract and is often linked to resale of the unit — this can take months or even years. We carefully review refund timing clauses before you sign.
Will my Will be affected by entering aged care?
Yes — both directly and indirectly. The RAD or ingoing contribution may form part of your estate, the home you sold may have been a major asset specifically gifted in your Will, and you may need to update your Enduring Power of Attorney to allow someone to manage your aged care arrangements if you lose capacity. We strongly recommend reviewing your Will and powers of attorney at the same time as entering aged care.
How much does a contract review cost?
Most retirement village and aged care contract reviews are completed on a fixed fee, depending on the complexity and length of the contract. The fee is confirmed in writing before we start. The first 30-minute consultation is complimentary for new clients.
For broader contract advice see our Contract Law page, and for related estate planning see Wills & Estates.
Get independent advice before you sign
The cost of getting it wrong is six figures. The cost of getting independent legal advice is a small, fixed fee. Send us your contract today.
First 30 minutes free for new clients.
Call 1300 344 960