The Centrelink Age Pension changes, which took effect on July 1, 2024, are now fully implemented, benefiting thousands of older Australians. These adjustments are designed to enhance financial flexibility and improve quality of life for pensioners across the country.
While the base pension rates remain unchanged, the updated income and asset test thresholds mean that many pensioners are now eligible for higher payments. In addition, these changes have expanded eligibility, allowing more people to qualify for the Age Pension and providing a smoother transition for some from part pensions to full pensions.
Table of Contents
- Updated Qualification for the Age Pension
- Income Test Adjustments
- Asset Test Changes
- Deeming Rates and Thresholds
- Additional Adjustments
- Reviewing Your Pension Eligibility
1. Updated Qualification for the Age Pension
To qualify for the Age Pension, individuals must be at least 67 years old and pass both income and asset tests. As of July 1, 2024, the thresholds for these tests were adjusted to reflect inflation, allowing pensioners to retain more income and assets before their pension payments are affected. This change will result in increased payments for many Australians.
2. Income Test Adjustments
The income test thresholds have been updated to allow pensioners to earn more without impacting their payments:
- Single Pensioners: The income-free area has increased from $204 to $212 per fortnight. Pension payments will reduce by 50 cents for every dollar earned beyond this threshold.
- Couple Pensioners: The combined income-free area has risen from $360 to $372 per fortnight, with the same reduction applied for any income above this amount.
Additionally, the maximum income limits before pension payments cease have been updated:
- Single Pensioners: The income limit has increased from $2,436.60 to $2,444.60 per fortnight.
- Couple Pensioners: The combined income limit has risen from $3,725.60 to $3,737.60 per fortnight.
3. Asset Test Changes
Changes to the asset test thresholds have allowed pensioners to retain higher asset values without affecting their pension payments. These changes are particularly beneficial for homeowners:
- Single Pensioners (Homeowners): The asset limit for the full pension is now $314,000 (up from $301,750).
- Couple Pensioners (Homeowners): The combined asset limit for the full pension is now $470,000 (up from $451,500).
For non-homeowners, the changes are as follows:
- Single Pensioners (Non-Homeowners): The asset limit for the full pension is now $566,000 (up from $543,750).
- Couple Pensioners (Non-Homeowners): The combined asset limit for the full pension is now $722,000 (up from $693,500).
For part pension recipients, the new asset test thresholds are as follows:
- Single Homeowners: The asset limit for part pensions is now $686,250 (up from $674,000).
- Single Non-Homeowners: The asset limit for part pensions is now $938,250 (up from $916,000).
- Couple Homeowners: The combined asset limit for part pensions is now $1,031,000 (up from $1,012,500).
- Couple Non-Homeowners: The combined asset limit for part pensions is now $1,283,000 (up from $1,254,500).
4. Deeming Rates and Thresholds
Deeming rates, which are used to estimate income from financial assets, have remained frozen until June 30, 2025. However, the thresholds for deeming have been indexed to reflect higher asset values, allowing for more favorable rates:
- Single Pensioners: The first $62,600 of financial assets is deemed to earn 0.25% (up from $60,400).
- Couple Pensioners: The first $103,800 of combined financial assets is deemed to earn 0.25% (up from $100,200).
Any amounts above these thresholds continue to be deemed to earn 2.25%.
5. Additional Adjustments
Several other pension-related adjustments were made to provide greater financial support for certain groups, including:
- Retirement Village and Granny Flat Residents: The additional allowable amount for non-homeowners in retirement villages or granny flats has increased to $252,000 (up from $242,000).
- Special Disability Trusts: The concessional asset value limit has increased to $813,250 (up from $781,250).
- Exempt Funeral Investments: The threshold for exempt funeral investments has increased to $15,500 (up from $15,000).
6. Reviewing Your Pension Eligibility
Pensioners are encouraged to review their financial situations to understand how these updated thresholds may affect their payments. For detailed guidance or specific advice, it’s recommended to contact Centrelink directly or consult with a financial advisor.
