The Centrelink Age Pension updates, which were implemented on July 1, 2024, are now fully active, offering significant improvements for many older Australians. While the base pension rates remain unchanged, the increase in income and asset test thresholds has resulted in higher payments for numerous pensioners. This adjustment has expanded eligibility, allowing more individuals to qualify for the pension and enabling some recipients to transition from partial to full pension payments.
Key Changes and Updates
Updated Qualification Criteria for Age Pension
To be eligible for the age pension, individuals must be at least 67 years old and pass both the income and asset tests. As of July 1, 2024, these thresholds were raised in line with inflation, allowing individuals to retain more income and assets before their pension payments are impacted.
Adjustments to the Income Test
The income test thresholds have been increased, meaning pensioners can now earn more without affecting their payments:
- Single Pensioners: The income-free area has been raised from $204 to $212 per fortnight. Beyond this amount, the pension reduces by 50 cents for every dollar earned above the limit.
- Couple Pensioners: The combined income-free area has increased from $360 to $372 per fortnight. Any income over this threshold will lead to a 50-cent reduction for each additional dollar earned.
The upper income limits, beyond which pension payments cease, have also been adjusted:
- Single Pensioners: The new limit is $2,444.60 per fortnight (previously $2,436.60).
- Couple Pensioners: The new limit is $3,737.60 per fortnight (previously $3,725.60).
Changes to the Asset Test
The asset test thresholds have also been revised, allowing pensioners to keep more assets without affecting their pension:
- Homeowners:
- Single Pensioners: The asset limit for full pension eligibility has increased to $314,000 (up from $301,750).
- Couple Pensioners: The combined asset limit for full pension eligibility has risen to $470,000 (up from $451,500).
- Non-Homeowners:
- Single Pensioners: The asset limit for full pension eligibility is now $566,000 (up from $543,750).
- Couple Pensioners: The combined asset limit for full pension eligibility has increased to $722,000 (up from $693,500).
For those receiving part pensions, the new asset limits 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).
Deeming Rates and Thresholds
Deeming rates, which estimate income from financial assets, remain unchanged until June 30, 2025. However, the thresholds have been indexed, allowing higher asset amounts to be deemed at a lower rate:
- Single Pensioners: The first $62,600 in financial assets is deemed to earn 0.25% (up from $60,400).
- Couple Pensioners: The first $103,800 in combined financial assets is deemed to earn 0.25% (up from $100,200). Amounts exceeding these thresholds continue to be deemed at 2.25%.
Other Notable Adjustments
Several additional changes have been implemented for pension recipients:
- Retirement Village and Granny Flat Residents: The allowable asset amount for non-homeowners in retirement villages or granny flats has increased to $252,000 (up from $242,000).
- Special Disability Trusts: The asset limit for concessional trusts has risen to $813,250 (up from $781,250).
- Exempt Funeral Investments: The threshold for exempt funeral investments has been raised to $15,500 (up from $15,000).
Reviewing Your Pension Eligibility
With these new thresholds in place, pensioners are encouraged to review their financial situation to see how these changes may affect their payments. For personalized guidance, it is recommended to contact Centrelink directly or consult with a financial advisor.
These updates to the Centrelink Age Pension are designed to improve financial stability for older Australians, offering the potential for higher payments and enabling more individuals to qualify or increase their pension benefits.