When are investments valued for deeming rates?

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Harry is confused about the dates deeming rates are applied in the income assessment and wants some clarification on the rules.

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Q. Harry
I am an age pensioner and a little confused on how to work out the deeming amount on an investment that may change during a financial year. For example, an investment may be valued at $100,000 on 1 July but after drawdown may only be valued at, say, $80,000 on 1 January. Is the start date for deeming calculations the first day of the financial year, or for investment balances on the last day of the financial year? If it commences on the first day of the financial year, is it calculated daily or fortnightly? When official deeming rates alter within the financial year, does the new rate apply for the whole of the financial year or only from the date that it changed?

A. Normally investments are valued on 20 March and 20 September each year.

However, due to the unusual circumstances caused by the COVID-19 pandemic, investments were also valued on 1 June this year to account for the downturn in financial markets.

Services Australia will get the new values from the latest unit prices they have or will ask you for the latest values, if required.

When deeming rates alter throughout the year, the government will announce when the new rates apply from. The last change to deeming rates took effect on 1 May this year.

Are your investments worth less due to the COVID-19 pandemic? Have you started receiving higher pension payments as a result?

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Written by Ben

4 Comments

Total Comments: 4
  1. 0
    0

    I understood that if the value of your assets changed by $1000 or more you had to advise Services Australia within 14 days.
    Has this changed?
    Migrant

    • 0
      0

      There’s never been an amount quoted, maybe someone told you that but that’s ONLY an opinion not fact.

      Straight from the website:

      “You must tell us if any of the following happens:
      your address changes
      your income or assets change
      your partner’s income or assets change
      you stop living with your partner
      your partner dies
      you marry or start living with your partner
      you’re leaving the country temporarily or to live somewhere else.
      You have 14 days to tell us about the changes. If you don’t do this, we may pay you too much and you’ll probably have to pay the money back.”

      This article is saying your investments are deemed twice a year on those dates, that doesn’t stop you from updating Centrelink about changed value as you draw down on your investments.

  2. 0
    0

    Sorry Greg, but I have a letter of 12 Aug 2019 from Centrelink, which says on the reverse:
    You must tell us within 14 days…..
    “ ASSETS: If the value of your …assessable assets change by $1,000 or more….

    Earlier the same letter states
    FINANCIAL INVESTMENTS…..a change of $2,000 or more ….

    As you would appreciate, this was an impossible condition for anyone receiving a monthly pension exceeding $2,000 into their Bank A/c.
    Migrant

    • 0
      0

      Like you said that’s dated 12 Aug 19, maybe it has changed. The website makes no mention of dollar amounts. Best to call them to get the facts not opinions from people on here who have no idea apparently.

      “this was an impossible condition for anyone receiving a monthly pension exceeding $2,000 into their Bank A/c.”

      No not impossible at all, you can phone, call in or go online as often as you like to adjust your assets on hand.


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