When assessing eligibility for the aged pension applicants are given an income test and an assets test – the test that produces the least amount of pension is the one used.
Some assets are exempt – these include the family home, assets in superannuation under pension age, funeral bonds up to $12,250 for a single bond, an accommodation bond paid to an aged care facility, and gifts within the allowable limits.
Home contents, cars and boats are valued at market value – not replacement value.
The assets test has different thresholds for homeowners and non-homeowners.
Income Test
At 1 July 2017 a single pensioner could earn $168 a fortnight and still be eligible for the full single pension of $888.30 a fortnight, including all supplements. They can also earn $125 a week from personal exertion – this is not included in the income test. Once income exceeds $168 a fortnight the pension reduces by $0.50 for every additional dollar earned.
At 1 July 2017 a pensioner couple could earn $300 a fortnight (combined) and still be eligible for the full pension of $1339.20 a fortnight, including all supplements. They can also earn $125 a week each from personal exertion – this is not included in the income test. Once income exceeds $300 a fortnight the pension reduces by $0.50 for every additional dollar earned.
Asset Test
From 1 July 2017 the full pension is available, under the assets test, for home owner singles whose assessable assets are under $253,750 – for home owner couples the number is $380,500. The numbers for non-homeowners are $456,750 and $583,500 respectively.
Once assessable assets exceed the lower threshold the pension reduces by $3 fortnight for each $1000 by which assessable assets exceed the lower threshold.
A single homeowner can have up to $550,000 of assessable assets and receive a part pension – for a single non-homeowner the lower threshold is $753,000. For a couple the higher threshold to $827,000 for a homeowner and $1,030,000 for a non-homeowner.
Please note: Calculated answers include all supplements and if calculated for a couple is the joint pension. It is also assumed that both parties are of pensionable age.