People on the Age Pension will see the cut-off limits for the income and assets test lifted on September 20. (Source: AAP/Facebook – Cash is King)
Australians on the Age Pension are set to have a bit more breathing room under changes being actioned in a few weeks. Not only will their payments go up on September 20 to keep pace with inflation, but also the cut-off limits for the income and assets tests.
This will mean that the 2.6 million pensioners will be able to have slightly more money coming in or higher-value assets than before. Tanya Plibersek, Social Services Minister, said these adjustments ensure the welfare system remained “grounded in fairness”.
“We’ll continue to make sure the system is there to support those who need it most, ensuring that everyone can make ends meet and no one gets left behind,” she said.
At the moment, if you’re single and earning more than $2,516 per fortnight, you won’t be able to access the Age Pension at all.
From September 20, the limit for the part pension will increase by $59.40 to $2,575.40 per fortnight.
For couples, the combined fortnightly salary threshold will go up by $89.60 to $3,934.
The full pension rate will remain unchanged. Single people can earn up to $218 per fortnight, and couples can earn up to $380 combined.
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A single homeowner will also have a $10,000 boost to their assessable assets for the part pension.
Assets can be financial investments, superannuation, real estate, home contents, shares, gifts and others.
These people will be able to have up to $714,500 in assets, while non-homeowners will be able to have up to $972,500.
Couples will get a $15,000 boost to their assets for the part pension. Homeowners can have up to $1,059,000, while non-homeowners can have up to $1,332,000.
The full pension rates for the assets test will also remain unchanged.
Single homeowners can own up to $321,500 in assets, while single non-homeowners can own up $579,500 in assets.
Couples who own their homes can have $481,500 in assets, and non-homeowners can have up to $739,500 in assets.
The amount pensioners receive will also go up on September 20 by nearly $30 per fortnight.
When you include the supplement and energy supplement, the payment for single people will go from $1,149 to $1,178.70.
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Couples will get a $22.40 lift in their payments, with the fortnightly amount going from $866.10 to $888.50.
However, September 20 will also see deeming rates lifted for the first time in years.
Deeming rates are the rates of return the government assumes people earn on financial assets, including shares, superannuation and bank accounts.
While the Age Pension payment will be going up on September 20, deeming rates could impact older Aussies. (Source: Getty) · Toa55 via Getty Images
They have been frozen at 0.25 per cent and 2.25 per cent, respectively, since 2020.
For singles, the first $64,200 of your financial assets has had a deemed rate of 0.25 per cent, while anything over that amount is deemed to earn 2.25 per cent.
For couples where at least one person gets a pension, the first $106,200 of your combined assets has had a deemed rate of 0.25 per cent. Anything over that is deemed to earn 2.25 per cent.
These rates will go up in a few weeks by 0.5 per cent, meaning the lower deeming rate will rise to 0.75 per cent, while the higher threshold will be 2.75 per cent.
“As Australians begin to feel the positive impacts of inflation easing, the government will now gradually return deeming rates to pre-pandemic settings,” Plibersek said.
“That is, to reflect rates of return that pensioners and other payment recipients can reasonably access on their investments.”
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