27th May 2015
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How will I be assessed?
How will I be assessed?

Richard will soon be returning from overseas but, as his wife isn’t yet of Age Pension age, he is seeking clarification on how his assets and income will be assessed.

Q. Richard

I am 64 and will remain overseas until next year. I have a few questions about claiming the Age Pension on my return.

1. To receive a part Age Pension, will my wife's half of the value of our jointly owned investment home count also as my asset? We also own our own home in Australia.

2. If the after expenses/taxes rental income from the investment home in number one above is $15,000 per year, will 100 per cent of that income count or only half of it ($7,500), as my wife (42 years old) owns half of the investment home?

3. If I buy an annuity with $300,000, will the sum invested ($300,000) count as an asset or only the annual income itself received from the annuity?

4. Will the worth of home assets count 100 per cent as an asset for the purpose of Centrelink's calculations, or as only half, given my wife owns the other half and she is more than 20 years away from being at pension age? 

A.

Richard, we can provide answers as guidance only. You should clarify your individual circumstances with Centrelink.

In answer to questions one, two and four, you will be assessed as part of a couple and therefore all income and assets earned and owned by you and your wife will be included. You will be subject to the limits defined for a couple. You can view the income and asset limits at:

Asset test tables

Income test limits

In answer to question three, how your annuity is assessed depends on whether it is a long-term income stream (greater than five years) or a short-term income stream (less than five years). Annuities are usually long-term, but you will need to take this into consideration when purchasing your annuity. You can find out more about how each is assessed and deemed by visiting Humanservices.gov.au.





    COMMENTS

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    Peterrj
    1st Jun 2015
    10:29am
    Gee Debbie, thanks for the comprehensive answer to the questions asked ie. Here look up the tables yourself. We all read with interest the questions posed and, effectively, your responce is to all of us. So what did I learn???? Nothing. It's one thing to be referred to the tables but it's another to try and properly interpret them. Can I suggest that you re do your answer and give a detailed response so that we can compare your interpretation to the tables and give the rider 'guidance only''. That way we can all learn from the experience. As for your good suggestion 'clarify your situation with CenteLink' ... Sorry, they only give very limited advice which is like 'yes or no' of you can claim ... that's if they know the answer themselves. Anyone else disappointed with Debbie's good advice? Anyone else disappointed with responses they get from Centrelink??? Come on Debbie, please help us all out on these issues other than giving us the tables to look up for ourselves.
    maelcolium
    1st Jun 2015
    11:56am
    That's a bit tough Peter. You can hardly expect specific advice. The basic information is on the web site. We probably all get frustrated with Centrelink, but Debbie can't legally provide specific advice on this site because it contravenes the financial planning laws.
    fatman
    1st Jun 2015
    12:52pm
    i sort of agree with you Peterrj, i have been trying to follow Centrelink tables but still don`t understand them. If Debbie had to explain them here you would no doubt need a week to read them. As i said to Renny, go to one of their seminars. They are usually advertised in local papers when & where they are on, or you can find out when they are on on the Centrelink website. Meet the finance people there (they are not advisors or planners, i forget what they call them) make an appointment to see one of them at your local Centrelink office. You tell them what assets you have, house, land, investments, money etc. etc. & THEY WILL TELL YOU WHAT CENTRELINK CAN GIVE YOU
    Adrianus
    1st Jun 2015
    3:50pm
    maelcolium, I find it strange that people who have nothing at all to do with financial planning can legaly give as much advice as they like. You are quite correct though, if Debbie is a licenced advisor she would need to follow a formal procedure.
    MICK
    1st Jun 2015
    6:05pm
    A bit strange from Debbie who is normally right on the money.
    I would not think that an answer to a question requiring clarification would be considered "advice" as Peter is not asking what he should do but rather how certain things might be viewed by the powers that be.
    I wouldn't mind understanding this is well.
    Retired Knowall
    27th Jul 2016
    5:09pm
    Debbie's answer is the best that anyone can expect in a forum like this.
    For specific advice, Centrelink has a Financial Information Service which I found to be very professional.
    Renny
    1st Jun 2015
    10:32am
    Anyone tried the Centrelink workshops? Are they worth attending. My spouse is pension age and I retire in August with five years until I'm 66.
    maelcolium
    1st Jun 2015
    11:50am
    They provide general advise so are a good start. After then work from the Centrelink web site and make an appointment for personal advice. Their financial planning staff are very helpful and give a copy of their advice, but book well in advance.
    fatman
    1st Jun 2015
    12:22pm
    Renny, centrelink workshops are very helpful, but you need to follow up with an appointent with one of their financial advice people who will be at the seminar. do not see people on the counter at centrelink, some of them dont even know they have financial people working there. Financial people do not give advice about what to do with the money or assets you have, THEY GIVE ADVICE ABOUT WHAT CENTRELINK CAN GIVE YOU.
    DebbieP
    1st Jun 2015
    1:24pm
    Richard, one thing you didn't mention is whether your wife will be working or not upon your return to Australia. If she is and earns a reasonable salary, then chances are you won't qualify for a pension until she gives up work. (My husband and I are in this situation; he's 67 but because I'm still working, he doesn't get anything from the govt by way of pension.) One more thing you might want to keep in mind is if she has superannuation in her name, then this won't be assessed as part of your assets until she is of pension age.
    Peterrj
    1st Jun 2015
    5:47pm
    OK, I tried this afternoon to obtain some fairly basic advice from Centrelink over the telephone. I rang and was put on hold for over an hour only to be to be eventually told that I had that I had the wrong section and my phone call was diverted to another section within Centrelink. Alas my phone went dead (flat battery) before the next section took my call. Conclusion : Have faith, Centrelink will give you good advice ... If only you can find someone to give such advice. And I appologise to Debbie, your advice was good. And good luck to those who follow it!
    fatman
    1st Jun 2015
    7:27pm
    yeh Peterrj & others, not a good idea to phone centrelink. It takes forever to get through & then you get on the merry go round of people who dont know or give you different answers. Local centrelink offices have been stripped of staff also, so you are in for a long wait if you go there for general enquiries. I found at the start they gave me half the paperwork i needed, or the wrong paperwork. Wore out a pair of shoes coming & going.!!!
    Peterrj
    1st Jun 2015
    11:32pm
    OK , I have played the game and here is Debbie's advice from just one of her her hyper links:

    Centrelink asset test limits for Allowances and full Age Pensions - effective from 1 July until 30 June 2015
    Situation
    Homeowners
    Non-homeowners
    Single
    $202,000
    $348,500
    Couple (combined)
    $286,500
    $433,000
    Illness separated (couple combined)
    $286,500
    $433,000
    Illness separated (couple combined)
    $286,500
    $433,000

    Centrelink asset test limits for part Age Pensions - effective from 20 September until 19 March 2015
    Situation
    Homeowners
    Non-homeowners
    Single
    $771,750
    $918,250
    Couple (combined)
    $1,145,500
    $1,292,000
    Illness separated (couple combined)
    $1,426,000
    $1,572,500
    One partner eligible (combined assets)
    $1,145,500
    $1,292,000

    Centrelink asset test limits for Transitional homeowner - Resident
    Situation
    Homeowners
    Non-homeowners
    Single
    $682,750
    $829,250
    Couple (combined)
    $1,062,000
    $1,208,500
    Illness separated (couple combined)
    $1,248,000
    $1,394,500
    One partner eligible (combined assets)
    $1,062,000
    $1,208,500

    Note: These tables are for guidance only and should be read in conjunction with Centrelink rules

    'Illness separated (couple combined)' ... What does that actually mean???

    'Illness separated (couple combined)' ... What does that actually mean???

    The Bank owns most of my house ... Am I a Home Owner???

    And 'Note: These tables are for guidance only and should be read in conjunction with Centrelink rules,'. Pray tell, What are those rules!??

    I conclude, Thanks for the advice ... Oops sorry, apparently you can't give advice can you???

    So the point of this article would be what exactly??? Work it out for yourself???
    Peterrj
    2nd Jun 2015
    10:52am
    To be added to my last comment:

    'One partner eligible (combined assets)' ... What does that actually mean?
    Momo
    23rd Sep 2015
    8:16pm
    I am a bit concerned about my situation and feel a bit cheated. I'm a 61 years single female and I no longer work sue to health. I have in Super 600k and I own my home. With the changes to the aged pension coming up, am I correct in assuming I will just miss out on the pension? I sacrificed myself all my life, long working hours and living a frugal life while everyone I know who has been on unemployment and pensions and enjoying life at the beach will be given (and I will be funding) freely the same amount, or close enough as I'm getting from my super? Is this correct or I'm not understanding what it's going on? Am I better off moving to a better house and start enjoying life and spend some money?
    Momo
    23rd Sep 2015
    8:18pm
    I meant: as I will be getting.
    retroy
    17th Mar 2016
    3:13pm
    Yes Momo

    You have every right to be disappointed with the system. People who have worked hard and been frugal just get a tax bill, while other spendthrifts get hand outs. This is said to be fair in Australia, while every one in the UK gets a pension providing they have had a normal working life.
    Of course the UK system is more fair because the earners and the savers had to pay more tax in their lifetime than the layabouts but they all get something back even those that paid little in tax.

    Australia just says "two to the valley"
    Lochie
    6th Aug 2016
    6:11pm
    Readers might be interested in reading my experiences during the last 2 weeks (in July,2016) with regard to Centrelink's Financial Information Officers: I met one of these friendly people at a retirement expo who gave me some brief information (which didn't seem to match with what I thought I already knew)and encouraged me to ring Centrelink to make an appointment with an officer at my local Centrelink. I bravely rang & simply put, got nowhere, so I confidently walked into the local building and asked if I could make an appointment. (I have done this in previous years). I was disappointed to be told I could only make an appointment by phoning...not by walking in...I give up. I asked my super fund & they didn't know. I'll simply be content by googling my questions and hoping for the best.


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