July 1. It’s one of my favourite times of year. We have passed the winter solstice and the days, albeit still dark and cold (at least down south), are slowly getting longer. And for the financial nerd part of me it is also the start of a new financial year. For some people that is more work and tax returns. But for those on, or nearly on, the Age Pension it often means more money in your pocket.
This year is no different. The new Age Pension thresholds have been announced which means some people will get a little more money while some that didn’t previously qualify might just scrape in. And just scraping in by a dollar can mean a lot as you can qualify for the pension and energy supplements as well as the Pension Concession card.
So what has changed?
Whilst the changes won’t go live until 1 July, the rates for each category of Age Pension entitlement have been released. This gives you time to consider what this means for you, depending upon the type of benefit you may receive, or hope to.
Below is a short summary of these changes, which we will follow up in fuller detail as the changes are activated on our Age Pension Entitlements Calculator.
And there’s another major change which will occur on 1 July. We previously reported that deeming rates are frozen until 1 July 2025. This remains true. But the deeming thresholds will be increased, benefitting all those whose assets are deemed to earn income by Centrelink. Watch your inbox for more on this next week.
Meanwhile, here’s what we can reveal regarding income and asset thresholds:
Full Age Pension income threshold increases by:
- The singles threshold increases from $204 to $212 per fortnight. An increase of $208 a year.
- The couples threshold increases from $360 to $372 per fortnight. An increase of $312 a year.
Upper (Disqualifying) income threshold increases by:
- Singles threshold moves to $2,444.60 from $2,436.60. An increase of $8 per fortnight or $208 per annum
- Couples combined threshold moves to $3,737.60 from $$3,725.60. An increase of $12 per fortnight or $312 per annum
Full Age Pension assets threshold increases by:
- Single homeowners threshold increases to $314,000. The increase is $12,250
- Single non-homeowners threshold increases to $566,000. The increase is $22,250
- Couple homeowners combined threshold increases to $470,000. The increase is $18,500
- Couple non-homeowners combined threshold increases to $722,000. The increase is $28,500
Upper (Disqualifying) asset threshold increases by:
- Single homeowners threshold increases to $686,250. The increase is $12,250
- Single non-homeowners threshold increases to $938,250. The increase is $22,250
- Couple homeowners combined threshold increases to $1,031,000. The increase is $18,500
- Couple non-homeowners combined threshold increases to $1,283,000. The increase is $28,500
The increase in the lower thresholds means more people will qualify for a full Age Pension than was previously the case and part pensioners could get slightly more as the taper rate kicks in later. The increase in the upper threshold means some people previously ineligible will now qualify.
Our eligibility calculator will be updated a couple of weeks in advance so stay tuned for our update next week.
In the meantime, if you have any pressing concerns about Age Pension eligibility or other Centrelink rules, you can book an entitlements consultation here.
Thank you,
very clear and precise expectations.
Hi
If a home is situated on, let’s say, 10 acres in regional Australia, and not used for any commercial purpose, could you tell me why 5 acres of that parcel is land is treated as an asset, whereas homes valued well in excess of what this home may be are not treated in the same way.
Thank you
I was wondering if the take into consideration the amount of your mortgage and deduct that from your super balance when looking at assets?
Hi Kerrie, Centrelink do not deduct the value of your liabilities off the value of your assets and assess the ‘net’ balance. Liabilities can only offset the asset they are secured against and as your home is exempt from assessment there is no asset for the mortgage to offset.
What if your home is on 100, 1000 or 10,000 acres? Would you be still wondering why only 5 acres with your home on it, is not treated as an asset? I was living in my house on 10 acres and had to sell it if I was to get any pension. These are the rules.
What is the base rate for couples on 5 acres
My wife and I are on a part pension due to the asset test. Is there a limit to how much income we can receive? My wife is thinking of working part time
Hi Bryan, the best way to figure our how much you and/or your wife can earn before it impacts you Age Pension is to use our free online calculator HERE.
My question is: Why can’t my husband who is 60 years old earn the equivalent of an aged pension without that lowering my full pension? We are struggling on one pension for the both of us at the moment. Please help.
THANKS .
Thats nowhere near catch up for increased costs since labor started eliminating the middle class by causing the biggedt cost of living increase in such a short time in my 80 years . So inept and driven by Marxist ideals.
It’s not a political page, go away.
Why is income based on gross earnings not net income this does not seem fair at all as it is not what we can pay our bills with
Wendy, that is an interesting question. I suggest it’s because people can manipulate their Tax deductions. An Example would be negative gearing which could make a person’s “income” become zero. As a part time worker and part pensioner, I use to wonder about this myself, but I can understand why.
Is there any consideration under review to remove the tax applicable to retirees receiving a commonwealth government pension ? Presently we receive a 50% discount on tax PA . However to my knowledge all other pensions a retirement recipients pay nil tax after 67 years of age .
Hi
If a home is situated on, let’s say, 10 acres in regional Australia, and not used for any commercial purpose, could you tell me why 5 acres of that parcel is land is treated as an asset, whereas homes valued well in excess of what this home may be are not treated in the same way.
Thank you
Hi Emily, although excess land may not be currently used for commercial purposes, there are still other ways it could generate a new income and/or asset for somebody. For example, Centrelink assess money sitting in a transactional account earning little to no interest the same way as they do money sitting in a term deposit. Just because it doesn’t currently do anything doesn’t mean it couldn’t.
Surely only when the excess land was actually used for commercial purposes the asset rule should apply.
But it should be noted that if the land is on a single title it becomes exempt after 20 year’s ownership.
I think it is time the Government looked at adopting the same pension system in place in Britain and New Zealand.You get your full pension entitlement and still receive an income. The extra cost would be offset by the tax paid on income plus no costs the cost of continually processing the “paperwork/data” involved in the fortnightly reporting requirements. There is constant talk of labour shortages and yet there are a number of pension age recipients who would like to work full or part-time but are deterred by being penalised by cuts to their pension payments and benefits
I agree with Diane Hills. The cost of entitlement checking by Centrelink is astronomical. They are chronically understaffed and pension applications are to at least 6 months. Just give everyone the pension and if they have additional income by investments, trusts or actual work then tax them accordingly.
We need this cohort of experienced and capable people in the workforce.
Thank you, very informative
Thank you Retirement Essentials, information is well presented and clear.
Hello
Just wondering if my wife and I will be considered “Couple non-homeowners” when we move from our current home, which we own, to a Retirement Village?
This will make a difference to our combined threshold entitlement.
The contract refers to us as “The Resident” with the property belonging to “The Owner”.
Thank you.
Mohan
Hi Mohan, generally speaking you will still be considered a homeowner when buying into a retirement village.
hi you said here over 5 acres ….But it should be noted that if the land is on a single title it becomes exempt after 20 year’s ownership.
I thought it had to be the house is your primary residence for 20 yrs, not the land ???Could you clarify this thanks
Hi Joanne, you are correct, the property needs to have been your primary residence, not just owned.
I’m 85 years old. I receive a full pension. I became a single pensioner recently when my husband passed away. I own my house. How much can I have in the Bank.?
If the family home is not included in the assets test then why is there such a difference between home owner and non home owner , at present the asset threshold is $470k and $722k it appears by not being a home owner you’re allowed an extra $252k in assets !!!
I agree everyone who has worked for more than 30 years as a citizen should get a pension