Three changes worth knowing
1. Income support bonus
The income support bonus helps people on certain income support payments.
From 20 March 2013, this will be paid in twice yearly instalments of $107.80 for a single person and $89.90 for each eligible member of a couple. This payment is tax-free and is not means-tested. Qualification for the payment is based on whether you receive any of the Government income support payments listed below on 20 March (for the March payment) or 20 September (for the September payment).
- Newstart allowance
- Youth allowance
- Parenting payment
- Sickness allowance
- Austudy payment
- Special benefit
2. Centrelink income assessment
New deeming rates apply from 1 July 2014 that may affect the way your income is assessed.
Centrelink/Department of Veterans’ Affairs use the term deeming to assess how much income you earn from your total ‘financial assets’ and, therefore, the benefits you may be entitled to receive.
Financial assets include:
- money in bank, building society and credit union accounts, term deposits, bonds, debentures, bullion
- money you have loaned someone or that is owed to you, money on hand, assets you gifted that were over the gifting limit (for 5 years)
- managed investments, shares and other listed securities
- money in the accumulation phase of super if you are at least age pension age.
For deeming purposes, the threshold that is applied to your total financial assets depends on your status ie pensioner couple, non-pension couple or single. The portion of your assets under these thresholds is deemed to earn 3.5 per cent and the remainder is deemed to earn 2 per cent.
|Pensioner couple (all financial assets are considered joint)||$79,600|
|Non-pensioner couple (each individual is assessed separately)||$39,800|
Example: If a pensioner couple's financial assets are worth $177,400, then their deemed income is calculated as:
|$79,600 x 2||= $1,596|
|$97,800 x 3.5%||= $3,423|
|Deemed income||= $5,015 pa|
|Important! The assessment is different to how income is assessed for taxation purposes. For example, it disregards any actual interest you may receive and, if you sell shares that you own and put the proceeds into your bank account, there should be no change to your assessed income by Centrelink, regardless of whether capital gains tax is applied to the sale.|
3. Minimum pension payment amount
Each year, there is a minimum amount you must draw down from your account-based pension or term allocated pension.
The minimum amount you must draw down each year is a percentage of your account balance at the start of each financial year (ie 1 July) that is based on your age. For example, if you are under age 65, then the minimum amount you must draw down from your account-based pension is 4 per cent.
|95 or older||14%|
From 1 July 2013, term allocated pension will also revert to normal payment levels, but the factor is based on the remaining term rather than your age.
|Important! If your Centrelink entitlements are paid under the income test, rather than the assets test, then your entitlements might be affected by the higher level of income payments you will now receive.|