Starting July 1, 2024, there have been some important updates to the Centrelink Age Pension in Australia. These changes could impact many seniors who depend on this financial support.
This article will explain the new rules and what they mean for pensioners, including adjustments to income and asset thresholds,
which may lead to higher payments for some. If you receive an Age Pension, it’s crucial to understand these updates to ensure you’re receiving the support you’re entitled to.
What’s New in the Centrelink Age Pension?
With the beginning of Australia’s new fiscal year, there are significant changes to the Centrelink Age Pension.
While the base pension rates remain unchanged, the income and asset limits have been increased. This could mean that some people might now receive more money or qualify for the pension if they previously did not.
Who Will Benefit?
Even though more Australians are joining superannuation plans, the Age Pension remains an essential income source for many seniors. According to Rice Warner,
about 39% of Australians rely on the Age Pension, with 24% receiving a partial pension. The recent changes could positively impact these individuals.
Eligibility Criteria for the Age Pension
To qualify for the Age Pension, you need to be at least 67 years old and meet the income and asset tests. Starting from July 1, 2024, the thresholds for these tests will increase with inflation.
This means you can now have higher income and more assets without affecting your pension.
Some people who were previously ineligible might now qualify for the pension, and those receiving a partial pension might be eligible for the full amount.
Changes to Superannuation Contributions
Alongside the Age Pension updates, there are changes to superannuation contributions. Employer contributions have increased from 11% to 11.5% to help boost retirement funds.
The contribution limits have also been raised: before-tax contributions are now capped at $30,000, and after-tax contributions are set at $120,000.
New Asset Limits for Age Pension Eligibility
Here’s a summary of the updated asset limits for full Age Pension eligibility:
For Full Pension Eligibility:
- Single Homeowner: $314,000 (up from $301,750)
- Single Non-homeowner: $566,000 (up from $543,750)
- Couple (combined) Homeowner: $470,000 (up from $451,500)
- Couple (combined) Non-homeowner: $722,000 (up from $693,500)
For Partial Pension Eligibility:
- Single Homeowner: $686,250 (up from $674,000)
- Single Non-homeowner: $938,250 (up from $916,000)
- Couple (combined) Homeowner: $1,031,000 (up from $1,015,000)
- Couple (combined) Non-homeowner: $1,283,000 (up from $1,290,000)
Income Threshold Updates
For single pensioners, the income threshold has risen to $212 per fortnight, up from $202. For couples, the new threshold is $372 per fortnight, compared to the old $360. This means you can earn more without reducing your pension.
Maximum Income Limits Before Pension Reduction:
- Singles: Up to $2,444.60 per fortnight (increased from $2,422.60)
- Couples: Up to $3,737.60 per fortnight (increased from $3,662.40)
The updates to the Centrelink Age Pension starting July 1, 2024, bring significant changes that could benefit many seniors. With increased income and asset thresholds, more people may now qualify for higher payments or even the full pension.
Additionally, superannuation contributions have been adjusted to support better retirement savings. It’s essential for seniors to review these changes and understand how they might impact their financial situation.
1. What is the Age Pension?
The Age Pension is a government payment to help seniors with their living costs. It is given to people over a certain age who meet specific income and asset tests.
2. What are the new asset limits for the Age Pension?
As of July 1, 2024, the new asset limits for full pension eligibility are $314,000 for single homeowners and $566,000 for single non-homeowners. For couples, it’s $470,000 for homeowners and $722,000 for non-homeowners.
3. How have income thresholds changed?
Income thresholds have increased to $212 per fortnight for singles and $372 per fortnight for couples. This means you can earn more without affecting your pension.
4.Will I receive more pension with these changes?
Possibly. The increased asset and income limits may mean that you qualify for a higher payment or even qualify if you didn’t before.
5.What other changes are there besides the Age Pension updates?
Superannuation contributions have increased from 11% to 11.5%, and the contribution limits have also been raised to help boost retirement savings.
