Reporting income can be a minefield for those on an Age Pension or those who may be entitled to one in the near future. The difficulty for many is that it is less than clear which income is reportable to Centrelink – and how and when you need to do this. Additionally, uploading information online is not always as straightforward or intuitive as some organisations think. Today we share some recent Q&As on reporting income and how it works in the real world.
I’ve just received my superannuation statement. Does this need to be forwarded to Centrelink now or will they request it? I can’t see anywhere on the Centrelink website to upload it?
Our answer. Centrelink won’t request the document from you, so it is best to take the initiative and upload it yourself. When you log in to your online Centrelink account you will see an option in the top right hand corner that says ‘Documents and appointments’ which, if you click, you will then see the ‘Upload documents’ option.
I am very confused. I have recently received my half yearly ‘Income Payment’ from my Account Based Pension which is paid into my bank account. Do I have to report this to Centrelink as income?
Meanwhile, my Pension & Super values have dropped a lot since I started to receive the Age Pension in earlier this year. Do I need to resubmit my bank statement and the pension valuation to Centrelink?
Our answer. The good news about Account Based Pensions is that these income streams are treated as assets and assessed based on the total balance available in the account, not the amount you are paid from it. Therefore you do not need to declare the payment you received as it is not considered income. Regarding your super balances it is definitely a good idea to give Centrelink updated balances of these and all other assets such as bank accounts, cars etc. so that Centrelink can more accurately calculate how much Age Pension you are entitled to. If, in fact, your superannuation has decreased, you could be entitled to a higher Age Pension, so this is an incentive to keep your records up to date.
I have recently received a tax refund. Do I need to report this as income?
Our answer. Tax refunds are not considered income for the purposes of Age Pension testing, so it is not necessary for you to report this.
How often should I advise Centrelink of changes to assets, ie share holdings and bank accounts?
Our answer. The important thing to know about updating your assets with Centrelink is that they will only update/recalculate based upon changes you advise and nothing else. Ergo, if you update the balances of your bank accounts only, Centrelink will not check on the share prices nor will they presume a decrease in the value of your car or consider any other changes that could have occurred.
As we’ve discussed before, the difference between assets and income (and therefore what is reportable) can be very confusing. There are also penalties for misreporting or failing to report, so there is a lot at stake. If you would like support from our qualified financial advisers on your specific income or asset concerns, tailored one-on-one advice consultations can provide a timely solution. Also, don’t forget that if you are employed and on the Age Pension you need to report your employment income to Centrelink on a fortnightly basis.
This article is provided by Retirement Essentials Representative Number: 001260855. We are an authorised representative of SuperEd Pty Ltd ABN 88 118 480 907 AFSL #468859. This information is not intended as financial product advice, legal advice or taxation advice. It does not take into account your personal situation, goals or needs and you should assess your own financial situation, consider if the information is suitable for you and ensure you read the relevant Product Disclosure Statement (PDS) if you choose to make any changes to your financial situation. It is always advisable to consult a financial adviser before making financial decisions.