Centrelink Q&A: Deeming rate dilemma

Font Size:

Jack wants to know which of his investments may be exempt from deeming rates.


Q. Jack
Prior to 2015, if you are on a Centrelink payment (say disability support payment or Age Pension) are your investments not subject to deeming as they have been grandfathered? Is this correct?

A. The rule you are talking about applies to account-based pensions only. All your other investments will have deeming applied when the income test is being worked out.

The balance of an account-based pension is deemed under the income test for government income support payments (for example, the Age Pension or the Commonwealth Seniors Health Card).

If you have an account-based pension that was established before 1 January 2015 and you received and continued to receive your Centrelink payment from before that date, then the income test rules that applied on 31 December 2014 continue to apply.

The same rule applies for those that qualified for a Commonwealth Seniors Health Card before that date.

A more generous income test treatment applies to these investments, because the account-based pensions are grandfathered.

For the Age Pension (or disability support payment), a non-assessable (deductible amount) offsets the account-based pension income, reducing the amount of income that is counted in the income test.

The provisions for the Commonwealth Seniors Health Card is even more generous, with no income whatsoever counting towards the income test.

To continue to be assessed under the more generous pre-2015 provisions, you must maintain the grandfathered account-based pension (although you can reduce the balance by withdrawing lump sums when required) and you must continue to receive your income support payment.

If your payment stops for any reason, the grandfathering provisions are lost and the next time you are eligible you will be subject to the same income test as those now applying for the pension.

If you enjoy our content, don’t keep it to yourself. Share our free eNews with your friends and encourage them to sign up.

Disclaimer: All content on 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 the ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own 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.

Join YourLifeChoices today
and get this free eBook!

By joining YourLifeChoices you consent that you have read and agree to our Terms & Conditions and Privacy Policy


How to know if you qualify for the carer’s allowance

Rosario is caring for a husband with dementia and wants to know if she can be compensated.

Winners and losers from Centrelink’s July changes

Centrelink is scrapping one payment, refusing to backdate another: are you affected?

Carer relationship determines size of payment

The type of relationship you have with your carer will decide what they are paid.

Written by Ben


Total Comments: 3
  1. 0

    So if I understood correctly.
    Once you receive an income based pension from your super, your super balance is deemed?



continue reading


Friday Funnies: The barista and the spoon

Enjoy these caffeinated jokes from Readers Digest while you sip your morning coffee. They may even improve the best part...


What chickens can tell us about living with COVID-19

Professor Amir Hadjinoormohammadi As the world grapples with rolling out various vaccines for the SARS-CoV-2 virus that causes COVID-19, there...


Vaccinations, transmission, contact tracing: COVID questions answered

What do we know about COVID-19? Given how new the disease is, how much has been learnt in the past...

Mental Health

What is agoraphobia and how is it treated?

Popping to the shops, picking up a coffee on the way to work, queuing up for entry to a gallery...


Benefits of kefir and what to look out for

Forget kale and nut butter: fermented foods are the one big health trend we'll all be spooning into our diet...

Age Pension

CPI figures point to an increase in the Age Pension in March

After pensioners were denied an Age Pension increase in September last year, due to a rare case of deflation in...


MND breakthrough offers hope damaged nerve cells can be repaired

There is hope of a breakthrough in treating motor neurone disease (MND) after Edinburgh researchers found a way to repair...


Avoid these common mistakes people make with bleach

Bleach is one of the most effective and least expensive disinfectants around, but it pays to remember it's not an...