Aged care pricing in Australia is layered, and the layers changed on 1 November 2025 when the new Aged Care Act commenced. This guide walks through every fee a resident can be asked to pay, with the current 2026 figures, so you can build a realistic budget before you talk to a home.
In this guide
01The four layers of residential fees
A person in permanent residential care can be asked to pay up to four things: a basic daily fee that everyone pays, means-tested contributions towards daily living and care, an accommodation payment for the room, and optional fees for extra services. Which layers apply, and how much, depends on an assessment of income and assets by Services Australia.
Government subsidies cover the rest. In 2024–25 the Australian Government spent $24.2 billion on residential care, which works out at roughly $480 of revenue per resident per day across the sector, most of it public money.
02The basic daily fee
The basic daily fee is set at 85% of the single basic age pension and is indexed on 20 March and 20 September each year. Every resident pays it regardless of means, and it covers day-to-day living costs such as meals, cleaning and laundry.
Because it tracks the pension, the fee rises twice a year. Budget for it going up, not staying flat.
03Means-tested contributions
For residents who entered care from 1 November 2025, the old means-tested care fee has been replaced by two contributions. The hotelling contribution covers accommodation running costs such as utilities and food preparation. The non-clinical care contribution covers personal care and lifestyle support. Clinical care is fully government funded and never charged to the resident.
Full pensioners with few assets typically pay neither. Part pensioners and self-funded retirees pay somewhere between zero and the maximum, based on the assessment. Residents who entered before 1 November 2025 stay on the previous rules, with a means-tested care fee capped at $370.39 a day, an annual cap of $35,910.43 and a lifetime cap of $86,185.23.
04Paying for the room: RAD, DAP or both
The accommodation price is the largest number and the one families find hardest. Each home publishes a price for each room type. You can pay it as a Refundable Accommodation Deposit, a lump sum returned when the resident leaves, less any agreed deductions, or as a Daily Accommodation Payment, which is interest on the unpaid lump sum, or as a combination.
At 8.43%, a $500,000 room costs about $115 a day if paid as a daily payment, or $42,150 a year. Under the new Act, providers may also retain 2% of a deposit each year for up to five years for residents who entered from 1 November 2025, so a $500,000 deposit could return $450,000 after five years. Residents with assets below the minimum permissible asset level, $64,500 from 1 July 2026, are classed as supported and pay a reduced or nil accommodation contribution instead.
Questions to ask
- What is the published price for the exact room I would get, not the display room?
- If I pay a daily payment, how often is it recalculated?
- What deductions come out of the deposit before it is refunded?
05Annual and lifetime caps
Caps stop means-tested contributions running indefinitely. For new residents the non-clinical care contribution has a lifetime cap of $137,917.01 and a four-year time limit. The cap is shared with Support at Home, so contributions made while receiving care at home count towards it. The basic daily fee, the hotelling contribution and accommodation payments are not capped.
Keep every fee statement. Services Australia tracks the running total, but it is worth checking their figure against your own.
06Extra and higher everyday living fees
Homes may offer a Higher Everyday Living Fee for services beyond the standard, such as premium menus, wine with dinner, hairdressing packages or pay television. It is optional, can only be agreed after entry, and has no set rate, so ask for the itemised list and the price. Some homes bundle these in a way that is hard to opt out of. You can decline them.
07Support at Home co-contributions
If care is still being delivered at home under the Support at Home program, the resident pays a share of each service's price depending on their means. Clinical care is free for everyone.
| Service type | Full pensioner | Part pensioner or CSHC holder | Self-funded |
|---|---|---|---|
| Clinical care | 0% | 0% | 0% |
| Independence | 5% | 5–50% | 50% |
| Everyday living | 17.5% | 17.5–80% | 80% |
People who held a Home Care Package before 12 September 2024 keep lower grandfathered rates. From 1 October 2026 personal care services move into the clinical category and become fully government funded, a $1 billion change in the 2026–27 Budget.
08Two worked examples
Full pensioner, modest assets, supported resident. Pays the basic daily fee of $66.80. No hotelling or non-clinical care contribution. Accommodation is government supported, so no deposit or daily payment. Annual cost about $24,400, entirely from the pension.
Self-funded retiree, family home sold, $500,000 room. Pays the basic daily fee of $66.80, the maximum hotelling contribution of $22.15 and a non-clinical care contribution up to $107.32, about $196 a day or $71,600 a year, until the lifetime cap is reached. Plus the room: either a $500,000 refundable deposit, or about $115 a day, $42,150 a year, as a daily payment. Any Higher Everyday Living Fee comes on top.
The gap between those two people is roughly $90,000 a year, which is why the means assessment matters more than the home's price list.
09Getting the means assessment done
Apply for the aged care means assessment through Services Australia before you start visiting homes. It tells you exactly which contributions apply and what the accommodation position is, and it is valid for 120 days. Homes will ask for the outcome letter.
For anything involving the family home, superannuation or gifting, an hour with a financial adviser who specialises in aged care will usually pay for itself many times over.
Sources: Department of Health, Disability and Ageing, Schedule of fees and charges for residential care, 1 July 2026; Base Interest Rate and Maximum Permissible Interest Rate; Support at Home participant contributions; Financial Report on the Australian Aged Care Sector 2024–25; IHACPA, Refundable accommodation deposits; Budget 2026–27. Figures are current at 14 September 2026 and change with indexation. This guide is general information and not financial advice. See our statistics page for the full data.