Age pension changes

Recent changes to the Age Pension may be welcome news to those who were previously ineligible and for those who are now eligible for increased payments.

On Wednesday 20 September 2023, the thresholds which determine how much pension is paid were increased. Based on Centrelink’s assets and income test, whichever test produces the lowest amount is used to determine your pension payment rate. An increase in the thresholds for the income and assets test mean some part-pensioners may now have moved to the full rate of pension. Likewise, some Australians who were previously ineligible due to having assets above the part-pension thresholds may be able to claim a part-pension and access the additional benefits that come with it.

How will the new rules affect me?

• Singles can earn $204 a fortnight and couples $360 a fortnight, before they lose their full pension and switch to a part pension.
• For single homeowners, they can also have about $301,750 worth of assets before their full pension starts to reduce with no pension paid once assets are greater than $667,500. While single non-homeowners can have $543,750 worth of assets before their full pension starts to reduce with no pension paid once assets are greater than $909,500.
• Homeowner couples on a full pension can have $451,500 worth of assets before they start receiving a part pension with no pension paid once assets are greater than $1,003,000. While a couple non-homeowner can have $693,500 with no pension paid once assets are greater than $1,245,000.
• If you previously were not eligible for a pension as you had too many assets or earnt too much income, these changes could see you gaining access to a part pension depending on your circumstances. Part of the changes also includes a slight change to the deeming threshold.

The Age Pension age also increased to 67 years from July 1. If you were born on or after 1 January 1957, you must be 67 years to be eligible for the Government Age Pension. If you want to start receiving the pension shortly after your birthday, you’re welcome to complete and submit your Age Pension application anytime in the 13 weeks prior to your birthday.

Contact/update Centrelink to assess your eligibility and ensure your pension rate is accurate

If you were previously ineligible for the Age Pension, now is a good time to contact Centrelink and put in an application.

If you were already eligible and your circumstances have changed, remember to update Centrelink within 14 days of any changes to ensure your fortnightly pension payment rate is accurate.

Updating Centrelink of any change in your circumstances can help ensure you don’t miss out on payments and or incurring a debt with Centrelink.

More information on the age pension can be found on the Services Australia website or you can feel free to contact our Financial Planning team for further advice.

This information has been produced by Jack McNamara, an Authorised Representative of Personal Financial Services Limited (ABN 26 098 725 145), of Level 10, 88 Philip Street Sydney NSW 2000, AFS Licence no. 234459. Any advice in this document is general advice only and does not take into account the objectives, financial situation or needs of any particular person. It does not represent legal, tax, or personal advice and should not be relied on as such. You should obtain financial advice relevant to your circumstances before making investment decisions. West Carr & Harvey Financial Planning is a registered tax (financial) adviser and any reference to tax advice contained in this document is incidental to the general financial advice it may contain. You should seek specialist advice from a tax professional to confirm the impact of this advice on your overall tax position. Whilst every care has been taken in the preparation of this information, it may not remain current after the date of publication and PFS and its related bodies make no representation as to its accuracy or completeness. Published: September 2023 © Copyright 2023