Reproduced from Centrelink's "A Guide to Australian Government Payments 20 September - 31 December 2011"

Basic Conditions of Eligibility
Residential Requirements for Pensions
Basic Rates
Pension Reform Transition Arrangements
Rent Assistance
Assets Test for Pensions
Income Test for Pensions
Deeming - Financial Investments
Centrelink & DVA Means Testing of Income Streams

Basic Conditions of Eligibility

• Men born before 1 July 1952 are eligible at age 65.
  
  
• Women born before December 1945 have reached pension age. For women born between 1 January 1946 and July 1952, see table below.
  
  

  Women born	Eligible for Age Pension at age
  1 July 1947 and 31 December 1948	64½
  1 January 1949 and 30 June 1952	65

  
  
  
• For both men and women born on or after 1 July 1952, see table below.
  
  

  People born between	Eligible for Age Pension at age
  1 July 1952 and 31 December 1953	65½
  1 January 1954 and 30 June 1955	66
  1 July 1955 and 31 December 1956	66½
  1 January 1957 and later	67

Residence Requirements

• Must be an Australian resident and in Australia on the day the claim is lodged, unless claiming under an International Social Security Agreement.
  
  
• Must have been an Australian resident for a total of at least 10 years, at least five of these years in one continuous period, or
  
  
• Residence in certain countries with which Australia has an International Social Security Agreement may count towards Australian residence, or
  
  
• Have a qualifying residence exemption (arrived as a refugee or under special program), or
  
  
• A woman who is widowed in Australia, when both she and her late partner were Australian residents and who has 104 weeks residence immediately prior to claim, or
  
  
• Person was in receipt of Widow B Pension, Widow Allowance, Mature Age Allowance or Partner Allowance immediately before turning age pension age.
  
  
• Can generally be paid for the total period of absence from Australia (some exemptions may apply), however, after 26 weeks the rate may change.

Note: Special rules in the case of travel to New Zealand, or if covered by an International Social Security Agreement.

Basic Rates

Status	Pension Rate Per Fortnight
Single	$689.00*
Couple (each)	$519.40* each

* These amounts exclude the Pension Supplement which pensioners may receive as an additional payment to the base pension (see Concession Cards, Supplements and Allowances).

• Paid fortnightly to a bank, credit union or building society account.
  
  
• If a couple is separated by illness, they may each be able to be paid at the single pension rate. The combined income and assets of the couple are used to work out their rates.
  
  
• The single rate may be payable to one member of a couple if partner not receiving payment is imprisoned or in a psychiatric hospital.
  
  
• Partnered rate payable to one member of a couple if partner is not receiving a pension, benefit or allowance.
  
  
• Not eligible for Education Entry Payment, or Pension Education Supplement.
  
  
• An advance may be available in certain circumstances.

Pension Reform Transitional Arrangements

Pensioners receiving payments at 19 September 2009 will not receive payment reduction because of the changes made to the pension systemfrom 20 September 2009 (including changes to the income test taper rate, the Work Bonus and removal of higher income test free area for pensioners with dependent children). These pensioners will be assessed under both the old rules and the new rules. Some pensioners will be paid a transitional rate until the new rules provide an equal or better outcome for them. The transitional rate is based on the income test rules and payment rates (indexed to CPI) that applied before 20 September 2009. Contact Centrelink for more information.

Rent Assistance

Family Situation	Maximum payment per fortnight	No payment if your fortnightly rent is less than	Maximum payment if your fortnightly rent is more than
Single, no children	$119.40	$106.20	$265.40
Single, no children, sharer	$79.60	$106.20	$212.33
Couple, no children	$112.60	$172.80	$322.93
One of a couple who are separated due to illness, no children*	$119.40	$106.20	$265.40
One of a couple who are temporarily separated, no children	$112.60	$106.20	$256.33

* Includes respite care and partner in prison.

• Rent Assistance for families with children is usually paid with Family Tax Benefit. See Family Tax Benefit Part A for current rates.
  
  
• Rent Assistance is not paid:
  
  
  • to people paying rent to a government housing authority, although in some situations sub-tenants may qualify for Rent Assistance.
    
    
  • for residents of Australian Government funded nursing homes and hostels.
    
    
  • to single Disability Support Pensioners under 21, without dependants, living with parents.
    
    
  • to other single people aged under 25, living with parents.
  
  
• Special rules apply to single sharers, people who pay board and lodging or live in a retirement village.
  
  
• Rent Certificates are required to verify rent where the person does not have a formal tenancy agreement or is not named as a tenant on a formal tenancy agreement.
  
  
• Rent Assistance is paid as part of another payment. It may be reduced due to the income test rules applying to that primary payment.
  
  
• Rent Assistance is subject to portability provisions where relevant.

Income Test for Pensions

(a) Income Test for Pensions†

(b) Income Test for Disability Support Pension under 21, no children

(c) Income Test for Pensioners - Transitional Rules^

The notional maximum pension for transitional rate pensioners is $650.90 per fortnight for a single pensioner and $1,051.40 per fortnight for pensioner couples. This rate excludes rent assistance.

(d) Income Test for Disability Support Pension under 21 - no children - Saved Status

Note: The rate of payment is calculated under both the income and assets tests. The test that results in the lower rate (or nil rate) will apply.

Pensioners receiving payments at 19 September 2009 may be paid under 'transitional arrangements' or saved status.

Some assets are deemed to earn income, while there are special rules for other types of income. Contact Centrelink for more information.

Employment income is subject to a Work Bonus for eligible pensioners over pension age.

Work Bonus

Basic conditions of eligibility:

• The Work Bonus is a concession on the income test treatment of employment income for pensioners over age pension age, except Parenting Payment (Single).
  
  
• The Work Bonus is used to reduce assessable employment income in an instalment period. An instalment period is a period of a maximum of 14 days.
  
  
• Half of the first $500 of fortnightly employment income will be disregarded from the income test for pensioners over age pension age. This is in addition to the normal allowable income threshold.
  
  
• All pensioners over age pension age, other than recipients of Parenting Payment (Single), are eligible for the Work Bonus. If they are eligible for a transitional rate, Centrelink will compare the transitional rate (which has no Work Bonus) to the new rate (which does include the Work Bonus). The transitional rate is paid where it pays a higher rate.
  
  
• No registration process, however pensioners must keep Centrelink up to date with their employment income.

Compensation Payment

Compensation payments, such as weekly workers' compensation payments, are assessed differently. If the compensable injury occurred prior to receiving an income support payment each dollar of any regular compensation payment reduces the income support payment (pension or allowance) by a dollar. If the compensable injury occurred while receiving an income support payment any regular compensation payment is assessed under the normal income test. Compensation payments may include a component of taxable income and it is this component that is included as income for Family Tax Benefit purposes. Lump sum compensation payments may result in a non-payment period. Contact Centrelink for more information.

• No income test on basic rate for age pensioners who are permanently blind; however, these pensioners may be affected by the special arrangements for compensation payments (see above).

Assets Test for Pensions

Assets Test Limits for Allowances and Full Pensions

Some assets are deemed to earn income, while certain assets are not included in the assets test; see Deeming - Financial Investments or contact Centrelink for more information.

Allowances, Austudy and Parenting Payment are not payable if assets exceed these amounts.

For pensions, assets over these amounts reduce pension by $1.50 per fortnight for every $1,000 above the amount (single and couple combined).

Assets Test Limits for Part Pensions

Transitional

Assets Test for Disability Support Pension - Aged under 21 (no children)

Some assets are deemed to earn income, while certain assets are not included in the assets test; see Deeming - Financial Investments or contact Centrelink for more information.

Note: The rate of payment is calculated under both the income and assets tests. The test that results in the lower rate (or nil rate) will apply.

The asset limits above may only apply to people who are resident in Australia, or are temporarily absent for up to 13 weeks. Contact Centrelink for more information.

Extra Allowable amount for Retirement Village and Granny Flat Residents

If your Entry Contribution is equal to or less than the Extra Allowable Amount, you are assessed as a non-homeowner. Your Entry Contribution will count as an asset. You may qualify for Rent Assistance. The Extra Allowable Amount is the difference between the non-homeowner and homeowner test limits, currently $135,000.

Hardship Provisions

If you have assets but little or no income you are expected to rearrange your affairs to provide for yourself. In some cases that is not possible. If you are in "severe financial hardship" you may be able to get a social security payment. Different tests apply to such cases.

• Hardship provisions may apply.
  
  
• No assets test on basic rate for age pensioners who are permanently blind; however, these pensioners may be affected by the special arrangements for compensation payments (see above).

Deeming - Financial Investments

Deeming is a set of social security rules used to assess income from financial assets. Under these rules it is assumed that financial investments are earning a certain amount of income, regardless of the income they actually earn.

Financial investments are:

• 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.
• Approved deposit funds, deferred annuities and superannuation fund investments held by people over age pension age.
• Loans, including those to family trusts and companies.
• Gifts of money or other assets of more than $10,000 in a financial year, or more than $30,000 over five financial years.

Deeming rates are:

Centrelink & DVA Means Testing of Income Streams

Classification	Income Test	Deductible Amount	Assets Test
Complying eg. Life or Life expectancy/fixed term pensions or annuities.	Gross Income less Deductible amount	Purchase Price Relevant Number (term)	Exempt
Non-complying (>5 yrs) e.g. allocated pensions, allocated annuities or term certain annuities.	Gross Income less Deductible amount	Purchase Price Relevant Number (term)	Account balance or if none: PP less [(PP - RCV) / RN x term elapsed]
Non-complying (5 yrs or less) e.g. term certain annuities.	Deem Income	Not Applicable	Account balance or if none: PP less [(PP - RCV) / RN x term elapsed]

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