How Centrelink assesses your super

If you are applying for or receiving Centrelink payments, your superannuation balance will not be taken into consideration if you haven’t reached Age Pension age.

When you do reach Age Pension age, your superannuation is counted in the assets and income test.

What you do with your superannuation is up to you, but the way you employ the funds will be taken into consideration when Centrelink assesses your financial situation to decide if you are eligible for a payment.

When you retire, you can ask your super fund to pay the money into your account as a lump sum or as pension. You may also decide not to draw on your balance.

Your super balance is assessed under the asset and income test. If you are part of a couple and your partner is under Age Pension age and their fund is not paying them a pension, then their super balance is not counted in the income and assets test.

If you are drawing an income stream from your super, how Centrelink assesses it will depend on whether the funds are exempt or partly exempt from the assets test, asset-tested long term or asset-tested short term.

Under the assets test, the balance on the latest statement from your superannuation fund is the amount that is assessed.

Under the income test, Centrelink uses the gross payment you get, minus your capital returns, if the income stream is:

  • non-account based
  • account based, if it started before 1 January 2015 and you got a pension or allowance without a break since 31 December 2014. 

Otheriwse, Centrelink will apply deeming rules to your superannuation under the income test. These are an assumed estimate of what your financial assets are earning in interest. Find out more about deeming and the current rates.

Exemptions to the deeming rules can be obtained if your super is fully preserved or inaccessible.

This information is general only, because the factors taken into consideration when Centrelink assesses your super can vary from one individual or one type of super balance to another.

To receive advice tailored to your particular situation you should visit a Centrelink service centre or call the Financial Information Service.

All content on the YourLifeChoices’ website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care, but no guarantees are provided for ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness with regard to your circumstances. You should seek professional advice from a financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances. Financial comments provided by readers cannot be relied on as professional advice, but as general comments only.

Related articles:

Superannuation and split ups
Age Pension complexities
How does your super rate?

Written by YourLifeChoices Writers

YourLifeChoices' team of writers specialise in content that helps Australian over-50s make better decisions about wealth, health, travel and life. It's all in the name. For 22 years, we've been helping older Australians live their best lives.

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