Age Pension

Age Pension for men and women aged 65 or over.

Centrelink applies an Asset Test and an Income Test to determine the amount of benefit you may be eligible to receive. Both tests are applied and the lower entitlement calculated determines the actual benefit you receive. If the lower calculated benefit is nil, no benefit it payable.

What is the Assets Test?

Different assets may be treated in different ways by Centrelink. Some assets may be fully or partially exempt. An example of an asset fully exempt under the Assets Test is your income. In some cases, assets you no longer have could even be counted if they were sold or given away for less than their market value.

The level of assets that you can own before your entitlements start to reduce will differ depending on whether you own your home or not.

What is the Income Test?

Income may be treated in different ways by Centrelink, depending on its source (e.g rental property). Financial assets are ‘deemed’ by Centrelink to earn a specified rate or income, regardless of the amount actually received.

Financial Assets

Financial assets include:

• bank, building society and credit union accounts

• term deposits and debentures

• friendly society bonds

• managed investments

• listed shares and securities

• shares in unlisted public companies

• gold and other bullion

• certain income streams (e.g short term assets tested income streams and certain account based pensions)

• approved deposit funds, deferred annuities and superannuation fund investments held by people over Age Pension age

• loans, including those to family trusts and companies, and

• gifts you have given of money or other assets of more than $10,000 in a financial year, or more than $30,000 over five financial years (referred to as deprived assets)

Deeming of Financial Assets

Deeming is a simple set of social security rules used to assess income from ‘financial assets’ regardless of what income you actually receive. Deeming is used to calculate income for pension, benefit and allowance payments.

Deeming rates are continually monitored to ensure that they are appropriate and may change depending on a number of factors. The deemed income is added to any income you have from other sources such as income from employment. Your total income is then used to work out how much pension, benefit or allowance can be paid to you.


Below are common questions often asked regarding Age Pension.

Am I eligible for the age pension?

The Aged Pension was put in place to support older Australians who are in need of income support and other concessions during their retirement years. Benefits are offered to Australian residents who are age 65 or over and meet the income and asset test requirements. The aged pension system provides a wide range of support for older residents during retirement.

Your eligibility to the age pension depends on when you were born.

Date of Birth Qualifying Age (Male) Qualifying Age (Female)

1/1/1949 to 30/6/1952



1/7/1952 to 31/12/1953



1/1/1954 to 30/6/1955



1/7/1955 to 31/12/1956



1/1/1957 onwards



Note that women who were born prior to 31 December 1948 have already reached their qualifying age.
The Aged Pension offers several other elements. This can include:

  • work bonuses
  • health cards
  • Concession cards
  • other supplemental payments.

These programs are set into place to assist seniors with the aging process. It provides funds for seniors who are in need of financial assistance as they reach retirement. There are specific rules and qualifications for each program and they may change frequently. It is recommended that you seek professional advice to ensure that you receive the Age pension benefits that you qualify for.

What are the payment rates?

Your age pension entitlement is based on the assets and income tests. The test that results in the lower entitlement determines your pension entitlements. The threshold for each test is adjusted for single and for couples.

Payments are determined by a few factors. This includes whether you are single or a couple. It also accounts for couples that must live separately due to health reasons.

Other payments are also available and will have separate requirements as far as income and asset tests. These include Widow B Pensions, Bereavement allowances, carer payments, and disability support pension payments.

What are the income and asset tests?

In order to qualify for The Age Pension you must meet income and asset tests.

The asset and income tests apply each year in March and September to determine if there are any changes in the recipient’s financial situation. A change in financial situation may result in the pension entitlement being adjusted.

If the pensioner exceeds the assets and/or income limits the pension can be reduced in staggered amounts based on the amount the individual or couple are over the established limits. There are also strict rules about disposing of assets, in order to qualify for the Aged Pension.

What are the residency requirements?

Essentially being a long time resident of Australia will qualify you for the aged pension. When you lodge a claim you must be a resident and currently living in Australia.

You also need to have been an Australian resident for a continuous period of at least 10 years, or for a number of periods that total more than 10 years, with one of the periods being at least 5 years. Unless you:

• Are a refugee or former refugee

• Were getting Partner Allowance, Widow Allowance or Widow B Pension immediately before turning Age Pension age, or

• Are a woman whose partner died while you were both Australian residents, and you have been an Australian resident for  two years immediately before claiming Age pension.

Are you ready to secure your financial future?

Your initial, no-obligation consultation with a Knowledge IQ Financial Planner is complimentary. Make an appointment for a time that suits you.