Changes to Centrelink Age Pension Set to Take Effect from 1 July

Upcoming Changes to Age Pension in Australia

As of July 1, significant adjustments to the age pension income and asset thresholds are set to take effect, impacting millions of Australians. While the actual payment rates remain unchanged, the raised thresholds will allow many more individuals to qualify for benefits and potentially increase payments for some existing recipients.

Key Changes

To qualify for the age pension from Centrelink, applicants must be 67 years or older and meet specific income and asset tests. The thresholds for these tests will see a 2.4% increase to help align with the current cost of living. This means that individuals can have a higher income and more assets before their pension payments are affected, potentially allowing new groups of people to qualify for the pension.

• Current Payment Rates:
  • Singles receive $1,149 per fortnight, including supplements.
  • Couples receive a combined total of $1,732.20 per fortnight.
  • Payments are reviewed and adjusted bi-annually in March and September.

Approximately 2.6 million Australians are currently accessing the age pension, which also provides recipients with a Pensioner Concession Card. This card offers additional benefits, such as reduced medication costs, bulk-billed doctor visits, and various government advantages at state and local levels.

Revised Income Thresholds

Effective July 1, the following income thresholds will apply:

• For Singles:

  • The amount you can earn to receive the full pension rises from $212 to $218 per fortnight, with the cut-off limit now at $2,516.
• For Couples:
  • The threshold increases from $372 to $380 per fortnight for full pension eligibility, with a new cut-off limit of $3,844.40.

Employment income, among other sources such as financial assets, will count towards the income test. Through the Work Bonus, pensioners can earn up to $300 in employment income every fortnight without impacting their pension.

Revised Asset Thresholds

The asset thresholds are also getting a boost:

• Single Homeowners:

  • The allowable assets increase from $314,000 to $321,500 for full pension eligibility.
• Couples:
  • The threshold rises from $470,000 to $481,500.

For those receiving a part pension, the thresholds will be adjusted to $704,500 from $697,000 for singles, and $1,059,000 from $1,047,500 for couples.

Non-homeowners will see their assets thresholds rise as follows:

• Single Non-Homeowners:

  • Allowable assets increase from $566,000 to $579,500.
• Couples:
  • Their threshold now increases from $722,000 to $739,500.

The cut-off for part pensions will be $962,500 for singles and $1,317,000 for couples.

Deeming Thresholds Increase

Starting July 1, deeming thresholds will also be updated:

• Singles: The lower deeming threshold will rise to $64,200 from $62,600.
• Couples: The lower threshold increases to $106,200 from $103,800.

For amounts up to the lower threshold, a deemed interest rate of 0.25% will apply, while amounts exceeding it will have a rate of 2.25%. This change may lead to a larger portion of an individual’s income being assessed at the lower rate, which could result in slightly higher payments for some.

Conclusion

The adjustments coming into effect on July 1, combined with the increase in income and asset thresholds, represent a positive shift for many Australians eligible for the age pension. This will enable more individuals to receive financial support and potentially enhance the benefits for those already receiving payments. As these changes roll out, it’s advisable for current and future pensioners to review their eligibility and assess how these modifications may affect their financial situation.

For further details, visit the official Centrelink website or contact your local Centrelink office.