The Centrelink Age Pension provides income for eligible older Australians who meet the criteria.

Am I eligible for the Centrelink Age Pension?

There are four keys to determining if you are eligible for a full or partial payment from the Centrelink Age Pension:

Age

As at 1 July 2017, you must be aged 65 years and 6 months or more in order to qualify for the Centrelink Age Pension.

If your date of birth is..... Your qualifying age is......
 Before 1 July 1952  65 years
 1 July 1952 to 31 December 1953  65 years and 6 months
 1 January 1954 to 30 June 1955  66 years
 1 July 1955 to 31 December 1956  66 years and 6 months
 From 1 January 1957  67 years

Residence requirements

To be eligible for the pension, you must be an Australian resident and physically present in Australia on the day you submit your claim.

Generally, you need to have been a resident for 10 years in total – and have had a period of continuous residency of at least 5 years.  However, exemptions can apply if you:

  • are a refugee or a former refugee
  • were receiving Partner Allowance, Widow Allowance or Widow B Pension immediately before turning Age Pension age
  • are a woman whose partner died while you were both Australian residents and have been an Australian resident for 2 years immediately before claiming the Age Pension.
  • lived and worked in a country with which Australia has an international social security agreement.

Income test

The income test is one test used by Centrelink to assess your means. The income test reduces your Age Pension payments for every dollar of income received, or have deemed to have received, over a certain amount.

As at 1 October 2017, a couple living together would receive a full Age Pension if their fortnightly income from other sources was $300 or less. For each dollar of income over $300, their fortnightly Age Pension payment would be reduced by 50 cents in the dollar.

If this couple’s income was $2,996.80 or more each fortnight, their pension payment reduce to $0. The limit may change so verify the latest figures from Centrelink

SINGLE
 Fortnightly income up to $164 over $164
 Reduction in payment  none - full payment 50 cents for each dollar over $164
COUPLE COMBINED,COUPLE SEPERATED DUE TO ILL HEALTH
   
 Fortnightly income up to $292    over $292
 Reduction in payment none - full payment    50 cents for each dollar over $292 (combined)
TRANSITIONAL RATE PENSIONERS - SINGLE    
 Fortnightly income up to $164 over $164  
 Reduction in payment none - full payment 40 cents for each dollar over $164
TRANSITIONAL RATE PENSIONERS - COUPLE COMBINED,COUPLE SEPARATED DIE TO ILL HEALTH
 Fortnightly income up to $292 over $292
 Reduction in payment none - full payment 40 cents for each dollar over $292

 

 

For Centrelink, your income includes both actual payments received and any deemed income. Your deemed income is determined by reviewing existing investments and applying deeming rules, which assumes that certain financial assets provide a fixed rate of return.

There are exemptions to the income test, including:

  • A rent subsidy paid by the commonwealth, state or territory government
  • Most payments made by Centrelink
  • Compensation for loss or damage to a building, plant and personal effects
  • The value of any free board or lodging you receive
  • A periodic payment from an immediate relative like parent, sibling or child (if you are receiving a pension)
  • Emergency relief or similar
  • Reimbursement of expenses
  • Some lump-sums including one-time gifts or an inheritance.

The income test thresholds also differ depending on your circumstances.

Assets test

Like the income test, the Assets test can mean a reduction of your eligible Centrelink benefits due to the value of assets.

The assets test threshold, or disqualifying limit, is the maximum value of assets you can have before they affect your Age Pension payment. As at 1 October 2017, a couple can maintain assets (excluding their family home) of up to $380,500 before it will begin to impact their Age Pension payments. The limit may change so verify the latest figures from Centrelink.

Some common assets that Centrelink take into consideration when assessing your assets includes:

  • investment properties
  • financial investments such as shares
  • superannuation and income stream investments, including account based pensions
  • business assets held as a partner or sole trader
  • motor vehicles, boats and caravans
  • household items, hobby or investment collections.

For each $1,000 in assets valued over the threshold, your pension payments will be reduced by $3.

The assets test threshold, or disqualifying limit, is the maximum value of assets you can have before they affect your Age Pension payment. The assets test thresholds increased under the 1 January 2017 changes, potentially allowing more part pensioners to qualify for the full Age Pension payment.

The below table outlines the assets test thresholds, or disqualifying limits, for the full Age Pension payment:

2016 rules 2017 rules
 Single homeowners full pension assets must be less than $209,000 $250,000
Single non-homeowners full pension assets must be less than $360,500 $450,000
Couple homeowners full pension assets must be less than $296,500 $375,000
Couple non-homeowners full pension assets must be less than $448,000 $575,000

The table below outlines the assets test thresholds, or disqualifying limits, for the part Age Pension payment:

2016 rules 2017 rules
Single homeowners part pension assets must be less than $793,750 $542,500
Single non-homeowners part pension assets must be less than $945,250 $742,500
Couple homeowners part pension assets must be less than $1,178,500 $816,000
Couple non-homeowners part pension assets must be less than $1,330,000 $1,016,000

 

The asset test thresholds also differ depending on your circumstances.

The payment for singles and couples may differ.

Centrelink takes into account your relationship status when assessing your income and assets which, in turn, may influence your Centrelink Age Pension eligibility and payments.  

 SEE THE LATEST AGE PENSION RATES

Our financial advice team can help you review your assets and liabilities to maximise the amount of Centrelink Age Pension you are eligible for – as part of a larger financial goals review session.

 NEED HELP WITH CENTRELINK ELIGIBILITY?

See how much the Age Pension could contribute to your income in retirement.

There are many other ways that you can maximise your income in retirement. Learn more about using pensions and investments to grow your account.

 MORE WAYS TO FUND YOUR RETIREMENT