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 $13,500 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
From 1 July 2021 a single pensioner could earn $180 a fortnight and still be eligible for the full single pension of $952.70 a fortnight, including all supplements. They can also earn $150 a week from personal exertion – this is not included in the income test. Once income exceeds $180 a fortnight, the pension reduces by $0.50 for every additional dollar earned.
From 1 July 2021 a pensioner couple could earn $320 a fortnight combined and still be eligible for the full pension of $1436.20 a fortnight, including all supplements. They can also earn $300 a fortnight each from personal exertion – this is not included in the income test. Once income exceeds $320 a fortnight, the pension reduces by $0.50 for every additional dollar earned.
Assets Test
From 1 July 2021 the full pension is available, under the assets test, for homeowner singles whose assessable assets are under $270,500 – for homeowner couples the number is $405,000. The numbers for non-homeowners are $487,000 and $621,500 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 $588,250 of assessable assets and receive a part pension – for a single non-homeowner the lower threshold is $804,750. For a couple, the higher threshold to $884,000 for a homeowner and $1,100,500 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.