How does Centrelink assess the UK Pension?

Mike receives a UK age pension and wonders how this payment is treated by Centrelink.

How does Centrelink assess the UK Pension?

Mike receives a UK age pension and wonders how this payment is treated by Centrelink.

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Q. Mike
I receive a UK age pension. Does Centrelink treat this as an asset or as income?

A. Centrelink will assess your UK pension as income and if this takes you over the income limit, your pension will be reduced by 50 cents for every dollar you exceed the limit. For example, the current limit for couples combined is $304 per fortnight. 

If your income, including your UK pension, is $2000 per fortnight, the first $304 will not be assessed. 

The remaining $1696 will reduce your pension by $848 per fortnight. Therefore, based on a couples combined full Age Pension of $1381.40, you would receive $533.40 per fortnight. These figures are for guidance only, and are based on the current limits, which you can view here.

When you advise Centrelink of your income and assets from overseas, it will convert the value into Australian dollars. 

Once you have been granted a UK pension, the amount will stay the same – it is not indexed. This means that the only fluctuation in the value of your payment will be due to the exchange rate. 

Centrelink currently uses the Commonwealth Bank buy rates that apply on the fifth business day before the first of each month.

Centrelink will update your income details on the first of each month and apply this rate of income to your Age Pension payment.

This is only a guide to what you may be entitled to. You can make an appointment to speak to a Centrelink Financial Information Services Officer on 132300. This is a free service, which you can access at any time, whether a customer of Centrelink or not, and will help you to better understand your entitlements based on your individual financial position.

Are you eligible for an Age Pension? Do you know your rights? The PensionChecker™ tool has all the information you need.

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    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 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 Centrelink Financial Information Services officer, financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.





    COMMENTS

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    Cowboy Jim
    22nd Mar 2019
    11:55am
    I am getting a small pension and you are right: it has remained at $US80 per month for 6 years. Every year I receive a statement from C/Link as to the monthly exchange rate. Hardly worth bothering every year to submit a statement to the former country that I am still alive. But it was a condition by C/Link when I put in a claim for an Aussie pension. Lived here since 1970.
    Spondonian
    22nd Mar 2019
    2:04pm
    That is why UK will not increase any pensions in Australia because they wont subsidise the Australian pension .
    Yer man
    22nd Mar 2019
    3:02pm
    I receive a British pension. Whenever I hit 65 Centrelink informed me that I may be entitled to a British pension .I already knew this but thought that Centrelink was on the ball..Tut,tut. The pension was counted as an asset and so reduced my Australian pension. Australia is one of the few countries that the British pension is not indexed. Bloody Colonials. We'll show them !!!~!
    Cowboy Jim
    22nd Mar 2019
    4:12pm
    All countries outside the EU are in the pot where the pension is not indexed. Maybe that will change with Brexit. Have friends in NZ and South Africa in the same boat. Indexation would not help me anyway as whatever they give me is taken into consideration here. Do not really care who gives me the pension as long as I get some.
    MICK
    23rd Mar 2019
    9:57am
    Be happy you get a pension.

    We've worked a lifetime in Oz but get nix because the current morally destitute government decided it would shake out retirees by forcing them to liquidate all their assets and live off the capital rather than the returns on capital, something it would never do to business.

    Whilst I have no problems with paying my own way I do have a problem with politicians engaged in class warfare who look after their own interest, pay off their donors and penalise those who do the hard yards for decades to stump up a few income earning assets.......which then save the government of the day paying out a full pension.

    Some of you are fortunate so be happy you are earning more than many self funded retirees with no worries about investments or the like. Sounds like the life of Riley to me and we may well live it up and join you.
    johnp
    23rd Mar 2019
    6:29pm
    Agree with Mick, Self Funded Retirees are discriminated against. Income received from an average super principal value which is excluded by the asset test for an old aged pension does not match the old aged pension.
    casey
    27th May 2019
    11:04am
    Agree with Mick and johnp. SFR also miss out on discounts for power, gas rego, rates etc. Would be better off to spend up big and claim the age pension.
    Mondo
    31st May 2019
    11:21am
    Mick is spot on, if you work hard and pay your taxes you support others on welfare and pensions but get nothing yourself when you retire. Any country that penalises success and rewards failure will eventually fail through lack of enterprise. You only need to look at the number of real jobs that have disappeared under this government, we make virtually nothing anymore and now we are even importing wheat.


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