How the Age Pension is affected when you go travelling

A lot of people look forward to retirement as a time to do all the travel they could never do while they were working. Whether in Australia or overseas, many of us can again get away and enjoy what the world has to offer.

If you own your home and you’re getting a payment from Services Australia, long-term travel can affect your rate of payment.

As a general rule, the family home is an exempt asset for Services Australia. This means the value of your home does not count under the assets test for your payment and you will be assessed under the lower home-owner assets test thresholds.

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When you temporarily vacate your principal home, it continues to be considered your principal home for the first 12 months that you’re away, which means it stays an exempt asset. If you’re away from home for more than 12 months, maybe to caravan around Australia, your family home won’t be exempt any more and will count under the assets test. You will be assessed as a non-homeowner with the higher assets limits.

If you decide to rent out your property while you’re travelling, the rules are different. Under the income test, the net rent you receive from renting out your home becomes assessable straight away. You need to tell Services Australia that you’ve started to receive rental income within 14 days.

Read: Does living in a granny flat, caravan or boat affect your pension?

This is important to consider, as even though we aren’t assessing the asset value of your home for the first 12 months you’re away, the assessable net rent could reduce your pension eligibility immediately.

If you temporarily leave the principal home because you are either giving or receiving care at someone else’s place, then your home is an exempt asset for two years. That means if you have to leave home to care for mum or dad, Services Australia will not count the value of your principal home as an assessable asset for two years from the date you leave. Just as before though, if you rent out your property, the net rent will be assessable immediately and could affect your pension rate.

With big choices like renting out the family home, it’s important to get all the information you need to make the best decisions. I suggest that if you’re ever thinking about getting rental income from your home, call Services Australia on 132 300 first and ask to speak to a Financial Information Service (FIS) Officer. Just say ‘Financial Information Service’ when asked for the reason for your call.

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A FIS Officer can give you free, independent and confidential information, tools and resources to help you make informed decisions about your current and future financial needs. He/she can also discuss the implications of different choices on your eligibility for payments, so give make that call.

Were you aware of the implication of taking more than a year to go travelling? And of renting out the family home? Why not share your experience in the comments section below?

Hank Jongen is general manager, Services Australia.

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  1. Ok thank you for the info but how about you write what you say you will write about “”How the Age Pension is affected when you go travelling”” as you indicating because this info is incomplete ……… How about if you do not have any properties in Australia ????? Ok for those that thinking to go overseas for a long time and have no properties in AU ,,,,, here is the info :

    1 – Your payments can continue while you’re outside Australia and you intend to be away for: less than 12 months, we’ll continue to pay you every 2 weeks into your Australian bank account. more than 12 months, we’ll pay you every 4 weeks into your Australian or overseas bank account.

    2 – Age Pension Portability
    The full amount of age pension that a person is eligible for is payable while overseas for 26 weeks. However, once overseas for longer than 26 weeks, the amount of age pension payable to a person is dependent upon the person’s length of residency in Australia.

    Note: The reality is that after 6 weeks overseas the pension is reduce to the minimum see my note below

    3 – For all other overseas information I suggest go here to read the rules

    4 – Just a note:
    If you are overseas for over 6 weeks your pension is reduced to the minimum wich is currently as follows (As per 20 Mar 2022):

    Pension payment = Max basic rate 900.80
    Supplement 25.20
    Energy 0.00
    Rental 0.00
    Total 926.00 every 2 weeks

    but all depens how long you live in Australia continuosly and will be calculated acordingly Check the web about Pension payments portability here ….

    And no medicare unless there is an reciprocal agreement with Australia
    And that is it …. you losse all other benefits

    Some exeptions are for disability so I suggest you have a look in the i ternet

    Our pension system is super complicated and in some areas hard to understand ….. I strongly suggest to read all available info on the internet and if anything not clear call Centrelink or visit them and ask for explanation I did that and now I am familiar with all aspects of my pension and follow the rules correctly and get No surprises reciving my pension correctley every 2 weeks and live in peace

    Hope this extra info help some of you

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