Reason for two-year residence rule

John is living in Vietnam and wants to know why he needs to move back to Australia to claim the Age Pension.


Q. John
I have been working out of Australia for the past 22 years. I am 76. Before I permanently left Australia in 1997, I had worked the required 35 years. I am now ready to request an Australian Age Pension. Can you explain why I have to spend two years qualifying time in Australia before I can have the pension paid in Vietnam? 

A. The Australian income support system differs from those of most other developed countries, in that it is funded from general revenue, rather than from direct contributions by individuals and employers. Instead of reflecting the level and duration of contributions into a social insurance fund, Australian income support is based on residence and need.

In general, a person must be an ‘Australian resident’, as defined in the Social Security Act 1991, in order to qualify for Australian social security payments. An Australian resident is a person who resides in Australia and has permission to remain permanently.

In deciding whether a person is residing in Australia, factors such as the person’s domestic, financial and family ties to Australia are taken into account, as well as the frequency and duration of any absences from Australia and the reasons for such absences.

If you are residing in a country that has a social security agreement with Australia, then you can apply for the Age Pension in that country, but at the moment there is no such agreement with Vietnam.

Written by Ben


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