Part of YourLifeChoices’ mission is to keep you up to date with retirement income changes and updates. From changes to deeming rates and pension rules, to increases in the Age Pension, the new income and assets test limits and the lowdown on downsizing legislation – we’ve got you covered.
From 20 March 2018, 4.7 million pension and allowance recipients received increases to their payments to help them keep up with rises in living costs. The base rate Age Pension for singles rose $12.20 to $826.20 per fortnight, and by $13.20 to $907.60 per fortnight including the pension supplement ($67.30, a $1 increase) and the energy supplement (static at $14.10).
The base rate for each member of a couple rose by $9.20 to $622.80 per fortnight and by $9.90 to $684.10 per fortnight including the supplement (a 70 cent increase) and the energy supplement (static at $10.60).
Income test limits
The new income thresholds are:
- $1983.20 per fortnight for singles (up ($26.40)
- $3036 per couple per fortnight (up $39.60).
Assets test limits
The new thresholds are:
- single homeowner $556,500 (up $4500)
- single non-homeowner $759,500 (up $4500)
- homeowner couple $837,000 (up $7000)
- non-homeowner couple $1,040,000 (up $7000).
The income test cut-offs for the Newstart allowance for those aged 60 and over are:
- $1139.17 for singles (up $12.67)
- $963.50 each for couples (up $10.50).
Changes to Age Pension rules
From 1 July, to receive an Age Pension or Disability Support Pension, a person will need:
- 10 continuous years of Australian residence, including at least five years during their Australian working life, or
- 10 continuous years of Australian residence and proof they have not received activity-tested income support for cumulative periods of five years or more, or
- 15 years of continuous Australian residence.
- Residence during a person’s working life is the number of years he or she has lived permanently in Australia between the age of 16 and Age Pension age.
Existing exemptions to the residence requirements for Age Pension and DSP will stay the same.
From 1 July, people aged 65 and over will be able to make a non-concessional (post-tax) contribution into their superannuation of up to $300,000 from the proceeds of selling their home.
The existing voluntary contribution rules for people aged 65 and older (work test for 65 to 74-year-olds, no contributions for those aged 75 and over) and restrictions on non-concessional contributions for people with balances above $1.6 million will not apply to contributions made under this new special downsizing cap.
This measure will apply to a principal place of residence held for a minimum of 10 years. Both members of a couple will be able to take advantage of this measure for the same home.
If you own financial investments and receive the Age Pension, or hope to claim the Age Pension, be aware that deeming rates are set to change on 1 July. The income you earn from your investments is generally not what is counted for the Age Pension income test, rather Centrelink deems your financial investments to earn a certain rate of income on those assets.