On 1 July the income and assets thresholds for Age Pensions will change.
This is a timely reminder for people who have previously been ineligible that it’s worth taking another look. We’ll let you know as soon as Centrelink announces the new amounts. And you can use our free Age Pension Eligibility Calculator at any time to work through your entitlements.
You may feel that reworking the sums or reapplying for an Age Pension is a lot of work for not much.
You would be wrong on both accounts.
Using the above mentioned calculator is quick and free. It does all the complicated calculations on income, assets and deeming rates.
And thinking a small Age Pension is only worth a few dollars a fortnight is also an error. Recipients of any Age Pension, be it part or full, receive valuable supplements. These are currently worth up to $78.40 per fortnight or $2038.40 per year in pension supplements and up to $14.10 per fortnight or $366.60 per year in energy supplements
Additionally, if you qualify, you will automatically be sent a Pension Concession Card. It is impossible to share a specific value for this card as it depends a lot on your need for pharmaceutical and medical services, your transport needs, rates and utilities, as well as your state or territory of residence. Conservatively, however, we would expect such a card to deliver between $3000 to $4000 of discounted services per year.
Last week our team assisted Marian who was recently widowed. She is now a single homeowner with total assessable assets of $670,000. She wants to retire, but her assets exceed the current maximum threshold of $634,750. This means that she is ineligible to receive the Age Pension.
Included in her assessable assets is a valuation of $50,000 for the contents of her home. We suggested that this could be valued at ‘garage sale’ returns, so she has adjusted this to $10,000. This will now make her eligible to receive a very small part-Age Pension of $14 per fortnight or $364 a year. Her daughter suggested that it wasn’t worth the time and trouble to reapply, for just under $400 per annum.
But we politely begged to differ.
By qualifying for an Age Pension of $364 per annum, Marian will also benefit by an extra $2405 per year in supplements. She will also be eligible the extra $3000-$4000 worth of benefits from holding a Pension Concession Card. She will also probably be a recipient of the extra $350-$500 state or territory-based energy payments when they come through later in the year. All-in-all, quite a lucrative return for bothering to reassess the assets included in Marian’s Centrelink application.
| Marian’s part-Age Pension entitlements | Fortnightly | Per Year |
| Income payment | $14 | $364 |
| Supplement | $78.40 | $2038.40 |
| Energy supplement | $14.10 | $366.60 |
| Pension Concession Card ($3000-$4000, say $3500) | $3500 | |
| TOTAL BENEFIT | $6269 |
As mentioned above, Marian is also expecting to gain from a one-off energy rebate announced in the May Federal Budget. It’s worth remembering that there were many similar special payments made to those holding concession cards during the Covid-19 pandemic. It’s clear that eligibility for an Age Pension, regardless of how small an amount, can certainly help toward many household bills.
What about you?
Are you ‘almost’ eligible, and so keenly awaiting the new 1 July thresholds?
Or are you already benefitting from the above Age Pension associated payments?
Has your experience been a good one? Or do you need to check if you are eligible?
Firstly thank you to the retirement essentials team for your informative weekly newsletters. The knowledge gained from these regular publications, keeping our minds at ease keeping up to date with retirement entitlements and tax regulations, is comforting as we traverse through life after retirement.
My wife and I are 65 and 63 respectively, both now self funded retirees. We recently sold our home of 15 years and have purchased land in a gated eco estate. We are now in the process of designing a single level house that we hope will be a low maintenance, aging body friendly sanctuary in our senior years. By the time the house is completed my wife will be close to pension age, and I will be two years off pension age. Given our assets and deemed income, following completion of the house, our primary residence, the retirement essentials pension calculator estimated we should both qualify for full pension upon reaching pension age.
We recently received our first notice of common property valuation from the body corporate, which brought up a concept we had not previously considered. Is our share of body corporate assets taken into consideration by Centrelink as personal assets for age pension qualification? While the land we have purchased is freehold, being a gated estate there is common property that is controlled by a body corporate. The valuation of the common property was considerable at over $8 million. With around 200 lots in the estate each lot owner’s portion of that common property is around $40,000. To be fully clear this is not so called engineered housing, where owners lease the land, we own the freehold land we will build on.
We feel an explanation of how body corporate assets and or engineered housing can effect age pension entitlements, would be an interesting subject to cover in future weekly newsletters.
Hi Marcus, thanks for the feedback, and for kicking off the comments! Centrelink only assess that which you have ownership/control over and could sell for/transform into cash if you so wished. I presume you would not have any authority to sell any of the body corporate’s assets nor receive a payment if they were to be sold.
When my sister moved from Disability Pension to Aged pension at age 66, she says she appears to have lost her concessions on electricity, gas etc. Does she have to advise anyone of the change? Her CRN remains the same doesn’t it?
I ask on her behalf as she doesn’t use computers or smart phones.
Hi Dinah, always good to hear from people helping their family or friends out! Your sister’s CRN does remain the same regardless of what benefit is received but she may need to contact her providers to let them know which benefit she is now receiving. Disability and Age Pensions generally offer the same concessions but there may be differences as we don’t specialise in Disability so cannot be certain.
Peter, I receive a CommSec Pension after completing twenty years in the Navy, approximately $27,000. How is this assessed by Centrelink for the Age pension? I will be 65 in December and my wife will be 66 in October . I intend to fully retire in November 2024.
Hi Peter, thanks for reaching out. Defined benefit pensions generally contribute to assessable income under the income test, but possibly with up to 10% offset depending on the taxable/tax-free portions. This varies from pension to pension. So, in summary, it’s a little complicated! I would love to help you understand the implications in more detail. I would recommend a consultation with myself or one of our other financial advisers, that way we can have a look at the impact of the pension itself, as well as your position regarding any other assets or income and how these may be impacting you. You can CLICK HERE to book a consultation, we offer three different options depending on your needs. I would probably recommend a Strategy Consultation in these circumstances, particularly if you want to understand your longer term position through retirement, but there are details on each option in the link provided.
I am nearing 67, I have been on jobseeker since 2020 , do I have to apply for the age pension again,at Centrelink, even though I have a CRN or will it automatically change over
Hi Sharon, thanks for reaching out! Unfortunately you will not just roll over on to the Age Pension and will need to apply. Centrelink will proactively send you a copy of the necessary forms to be filled when the time comes if you are happy to apply through them. We would be happy to help you prepare and lodge your claim also if you’d like someone to help guide and support you through the process.
Hi I submitted my claim for the pension in Feb 2023 and I have still not received any correspondence from centre link other than it’s being processed and we cannot give you a time frame when you will receive it. It’s now been almost 4 months and still nothing ??
Hi Diane, thank you for sharing your experience and I am sorry to hear how drawn out your claim has been. There are a number of factors that can cause a claim to genuinely take Centrelink months to approve such as private trusts/companies, SMSFs, Complex relationship status, residency status and many more. If you believe yours is a simple situation and you have provided all necessary documentation you can call Centrelink’s complaints line on 1800 132 468 to try and have it expedited due to the delay however there are criteria that needs to be met so expedition is not guaranteed.
If it is any reassurance to Diane re: length of wait for Centrelink response, I am in that “same boat.” I applied September 2022. For several months I received an encouraging message from Centrelink stating all of my documents were in order. For the past 3 months, I have heard nothing. Now, eight months out, I have visited Centrelink in person 4 times and no one has been able to help. I did happen upon another elderly person who confirmed a nine month timeframe is not uncommon. Calling and complaining (unless one is in dire financial straits) is not worth the wait for the call to be answered! Thank you for taking the time to read and possibly respond.
My husband submitted a claim in March with an advised decision time of the beginning of May, needless to say, we still have not had a decision. I finally rang last week to be told that they were waiting for documents which we had uploaded with the original application and again when it was requested. When the operator (after a 78 minute wait on the phone) checked, she could see we had in fact uploaded the documents they were supposedly waiting on. We have very simple affairs so the odd text messages saying more complex applications take more time are absolute bunkum. The time delays are ridiculous. Thankfully the pension would not be our main income or we would be in dire straits..