Centrelink assessment of super

YOURLifeChoices subscriber, Kathleen, would like to use some of her super to make much needed improvements to her home but wants to know if this will affect her Disability Support Pension.

Q. Kathleen
We are selling our house and buying another one. I am on the Disability Support Pension (DSP) and have access to my super. How does Centrelink stand on using super to make improvements on your house?

A. Provided by Centrelink
The answer is really dependent on whether or not you are over age pension age.

Under Age Pension age
If you are under the Age Pension age, all amounts in superannuation are exempt from the assets test. This also includes any withdrawals from superannuation where the person has access to their funds but is still under the Age Pension age.

However, the amount you withdraw from superannuation may be assessable depending on what you do with the proceeds. For example, if the funds are put into a bank account, then the amount is a financial asset and deemed income will be assessable on the balance. As you’ve indicated that you wish to use the money to make improvements to your home, there would be no effect on your pension as the principal home is exempt from the assets test.

Over Age Pension age
Once you have reached the Age Pension age then any amount invested in superannuation is counted along with other financial assets and deemed income is assessed. You can find more information on deeming here.

When an Age Pension aged customer makes a withdrawal from superannuation it has the same effect as them withdrawing money from a bank account – your assets and income are reassessed and your payment is adjusted accordingly (there is no profit assessed on withdrawal).

If you would like further information, you can contact a Centrelink Financial Information Services officer by calling 13 2300.

Leave a Reply

GIPHY App Key not set. Please check settings

Hearing funnies

Work cover after retirement age