Will I get a pension overseas?

Debbie McTaggart explains whether you are entitled to a pension when travelling or living overseas.

Q. John

I am struggling to make ends meet on the pension. I don’t own my own home and am thinking of moving overseas, either to Thailand or the Philippines. But how will such a move affect my Centrelink entitlements?

A. John, many older Australians burdened with the increasing cost of living in Australia and the struggle to make ends meet on the Age Pension or their savings, are looking to relocate overseas where money tends to go a little further. Of course, if you rely on a pension from the Department of Human Services, then you may have to be careful about where you go and how long you spend there. It is worth noting that the rules on pension payments while you are outside of Australia are due to change on 1 January 2013. As you do not mention which pension payment you receive, below is some guidance on how your payment may be affected based on these changes, however, you should contact Centrelink before making any decisions.

Age Pension
It is possible to get the Age Pension for the whole time you’re overseas, whether you have left Australia on a temporary or permanent basis. If you remain outside Australia for longer than 26 weeks, your pension will be reduced to a proportional rate based on your ‘Australian working life residence’. This is the number of years you have resided in Australia since age 16 to Age Pension age. If you have lived in Australia for 25 years (300 months), then you are paid the full rate of Age Pension to which you are entitled. If, for example, you have only resided in Australia for 20 years, then you will be paid 241/300 of the Age Pension (20×12 plus an extra month). If you leave Australia permanently, the rate of Pension Supplement you receive will reduce, or if leaving on a temporary basis, it will be reduced after six weeks of departure.

For those, however, who have been transferred to or granted an Age Pension less than two years ago, your pension will be stopped when you go overseas. There are plans to increase the amount of years from 25 to 35 under the ‘Australian working life residence’ from 1 January 2014. Those already living overseas on 1 January 2014 will maintain the 25 years as a base calculation, but should they return to Australia for more than six months and subsequently leave, they will be subject to the new regulations.

Disability Support Pension (DSP)
If you have been granted a DSP or transferred to the DSP less than two years ago, then your pension will be stopped. You can be paid the Disability Support Pension (DSP) for six weeks while outside Australia. You may able to receive the DSP for longer if you:

• are terminally ill and are leaving to be with family
• have been assessed in Australia as having no future work capacity, however, the rate you are paid may be reduced.

You may also continue to be paid a DSP for longer than six weeks if:
• you are studying outside Australia as part of a full time Australian course, or
• you are severely disabled and dependent on and living with a person who has been temporarily transferred overseas by their Australian employer.

There are different rules which apply to other payments and these can be found on the website of the Department of Human Services. If the country to which you are moving has an International Social Security Agreement with Australia, then you may be able to receive your payments for longer and at a different rate.

International Social Security Agreements
Payments outside Australia
Changes due on 1 January 2013

Written by Debbie McTaggart