The Centrelink means test consists of the Income Test and the Assets Test. The test which results in the lowest entitlement is the one which applies. Each test has cut-off limits and different limits apply to different types of benefits. In this Fact Sheet, we focus on JobSeeker Payment and the Age Pension. All figures are current as at 1 July 2020.
You may get JobSeeker Payment if you are aged 22 or over and under Age Pension age, are unemployed, and satisfy the Activity Test as well as the Income and Assets Tests.
* Fortnightly income between $106 and $256 reduces fortnightly allowance by 50 cents in the dollar. For income above $256 per fortnight, fortnightly allowance reduces by 60 cents in the dollar. Partner income which exceeds cut-out point reduces fortnightly allowance by 60 cents in the dollar.
** These figures may be higher if you are eligible for Pharmaceutical Allowance or Rent Assistance. Child maintenance is not included as income for the personal income test.
^ This figure includes Pharmaceutical Allowance
To qualify for JobSeeker Payment you must prove to Centrelink you are actively seeking paid work, or retraining yourself or doing acceptable voluntary work.
You may get Age Pension if you are aged 65.5 years and over, and your income and assets are below a certain amount. Age pension age will increase to age 67 by July 2023. (see table over page).
* Income over these amounts reduces the rate of pension payable by 50 cents in the dollar (single) or 25 cents in the dollar each (for couples).
# These figures may be higher if you also get Rent Assistance with your payment
# Limits will increase if Rent Assistance is paid with your pension.
* Assets over these amounts reduce pension by $3.00 per fortnight for every $1,000 above the limit (single and couple combined)
Centrelink assesses your income from financial assets (e.g. bank accounts and shares etc) not by the actual income you receive but by deeming. Centrelink deems you to earn 0.25% p.a. on the first $53,000 (single) or $88,000 (couple) of financial assets and 2.25% p.a. on all financial assets above that level. NOTE: Account based pensions (ABP) that commenced on or after 1 January 2015 are subject to deeming.
ABPs commenced prior to 1 January 2015, where a person was not receiving an income support payment from Centrelink/DVA before 1 January 2015, will be deemed. For ABPs commenced prior to 1 January 2015, provided that the ABP recipient was receiving an income support payment from Centrelink/DVA immediately before this date and they continue to receive an income support payment, the ABP will continue to be assessed under the old rules (i.e. not deemed).
You might currently exceed the assets cut-off limits, however it’s possible you could arrange your finances to pass the assets test. That’s because there are a number of key assets which are not assessed.
Increase to Age Pension Age
This information has been produced by Australian Unity Personal Financial Services Ltd (‘AUPFS’) ABN 26 098 725 145, of 271 Spring Street, Melbourne, VIC 3000, AFSL 234459. Any advice in this document is general advice only and does not take into account the objectives, financial situation or needs of any particular person. It does not represent legal, tax, or personal advice and should not be relied on as such. You should obtain financial advice relevant to your circumstances before making investment decisions. AUPFS is a registered tax (financial) adviser and any reference to tax advice contained in this document is incidental to the general financial advice it may contain. You should seek specialist advice from a tax professional to confirm the impact of this advice on your overall tax position. Nothing in this document represents an offer or solicitation in relation to securities or investments in any jurisdiction. Where a particular financial product is mentioned, you should consider the Product Disclosure Statement before making any decisions in relation to the product and we make no guarantees regarding future performance or in relation to any particular outcome. Whilst every care has been taken in the preparation of this information, it may not remain current after the date of publication and AUPFS and its related bodies corporate make no representation as to its accuracy or completeness. Published: July 2020 © Copyright 2020