Taper Rates: Understanding the Age Pension sliding scale
This often misunderstood term applies to a sliding scale which sits between entitlement for a full Age Pension, a part Age Pension and no pension at all.
When applied to your assets, it means that the value of your assets above the limit for a full Age Pension will trigger a reduction in your fortnightly entitlement.
The current taper rate is a reduction of $3 per fortnight for every $1,000 over the full Age Pension threshold. These are currently:
- $270,500 for single homeowners and $405,000 for couple homeowners
- $487,000 for single renters and $621,500 for couple renters
This amount is applied until your entitlement reaches a cut-off point where you receive no pension. This threshold is currently
- $593,000 for single homeowners and $891,500 for couple homeowners
- $809,500 for single renters and $1,108,000 for couple renters.
Here’s a short case study to illustrate the taper rate in action.
Robert is a 68 year-old single homeowner.
He earns no wages or salary, and his income deemed on assets of $300,000 is far below the income threshold.
So his Age Pension entitlement is assessed on the basis of his assets.
The full Age Pension assets threshold is $270,500 for single homeowners.
Because Robert is $29,500 over the threshold, a taper rate of $3 per fortnight, per $1000 in excess of the threshold, means his pension will be reduced by $3 x 29.5, or $88.50 per fortnight ($2301 per annum).
You can check how your assets affect the amount of your entitlements on our free eligibility calculator.
I have just used your eligibility calculator, and it suggests I should be getting $913 a fortnight but Centrelink advise me I can only get $834 a fortnight why is there a discrepancy.
The same figures were used in both instances.
Hi Graham, it is hard to identify where the discrepancy lies given we can only see the figures entered into our calculator. From previous experience, if you definitely have the right balances for your accounts then Centrelink may have an older asset of yours (such as a now closed bank account) that they are still assessing you on. You can request a summary of the income and assets Centrelink have recorded on file for you which can help identify if there is anything that you need to get them to update.
hi we live on 150 acres which as a primary producer have had a loss every year,my hushand is too sick to work it and is heading to pension age,we have owned he property for over 20yrs but only lived in shed and built a house 18yrs ago where do i go for advice on this Thanks
Hi Joanne, if you or anyone else reading would like to talk about your situation in detail, we offer 30min consultations at a cost of $75. We can clarify how Centrelink will assess you specifically and help guide you on any related matters that might impact your Age Pension. If you wish to proceed please CLICK HERE to book the best suitable time available.
Hello we have both recently retired. I am 66 and my spouse 63. We plan on travelling both within Oz and overseas. I have approx $850k in super and my spouse $330k. Debt free homeowners. I enjoy volunteering 15 hr to 20hrs per week at several charitable groups.
We downsized our large family home 3yrs ago and hold approx $80k in savings
I recently contacted an FIS officer from centrelink about elligibility to get some jobseeker benefits and was surprised when I was informed I may benefit should we reduce our savings and transfer some into my spouses super as they are both excluded for assets assessment. This I find very odd as the website states super funds which are held by persons who have attained preservation age eg; 60yr are deemed. That means a small 18mth opportunity for me to receive jobseeker. I am on call at a small local retail store having worked 15days so far this calendar yr.
We realise we shall not receive any age pension benefits when we turn 67yr though think it was possibly incorrect advice given from FIS officer. Can you confirm my suspicions I am correct that no jobseeker benefit shall be received?
Hi Mick, thank you for your question! If your partner’s super is in pension phase then yes it counts as an asset and has deeming applied to calculate income generated however if it is still in accumulation phase then as you were advised, it is exempt from assessment until your partner turns Age Pension age (67). There are a couple of tips and tricks you may be able to take advantage of and based on the numbers you mentioned you could actually receive a partial Age Pension once you turn 67. You should consider booking a consultation so that we can discuss your situation in more detail and let you know your options. CLICK HERE to find out more and make a booking.
Hello Owned investment property for over 10 years and never lived in it.
1. If I move into this property and make it my PPR; then sell it, can I downsize into super?
2. How long would I have to live in it as my PPR before selling it to downsize?
3. Would downsizing help to reduce the CGT. (Not purchased prior to 20 September 1985.
Hi Glenis, thanks for asking some great questions! These are really important topics to understand the pros and cons of but we wouldn’t be able to give you a proper response via this medium as there are a few ins and outs to be discussed and considered. Book a consultation with one of our specialists HERE and we can definitely go through this with you in detail.