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Assets Test
Centrelink
Changes to the Assets Test for Centrelink Age Pensions from 1 January 2017
Glenn Fairbairn
Director/Private Client Adviser
8 Nov 2016
In last year’s Federal budget, the government announced changes to means testing for the age pension. These changes come into effect from 1 January 2017 and will result in changes to current entitlements for a number of Australians.
Who do these measures apply to?
If you are over 65, and receive a full or part age pension, then you need to be aware that for every $1,000 owned above the assets test-free amount, your pension will be reduced by $3, this was previously reduced by $1.50 for every $1,000.
The thresholds that apply are dependent on whether you are single or a couple, rent or own your own home, and are either in receipt of a full or part pension.
For those on full pensions and are single homeowners, the pension starts reducing when assets reach $250,000. For couples, it applies when assets reach $375,000. For non-homeowners, the threshold is $450,000 for a single person, and $575,000 for a couple.
For single homeowners receiving a part pension, the pension cuts out when assets exceed $542,500 and for a couple it stops when assets exceed $816,000.
For single non-homeowners – the pension ceases when assets exceed $742,500, and for couples – when assets exceed $1,016,000.
What assets are included in the threshold?
The market value of most of your assets are considered when calculating your age pension. This includes but is not limited to:
Property (excluding your home)
- Motor vehicles, boats and caravans
- Financial investments
- Superannuation if you’re over age pension age
- Business assets
- Household contents and personal effects
For some, there will be little or no effect at all, but for others, these changes may affect their total retirement income.
If you are concerned about whether the changes to the age pension will affect you, please contact your Hewison Private Wealth adviser to arrange a time to meet to discuss your requirements in further detail.
Hewison Private Wealth is a Melbourne based independent financial planning firm. Our financial advisers are highly qualified wealth managers and specialise in self managed super funds (SMSF), financial planning, retirement planning advice and investment portfolio management. If you would like to speak to a financial adviser on how you can secure your financial future please contact us 03 8548 4800, email info@hewison.com.au or visit www.hewison.com.auPlease note: The advice provided above is general information only and individuals should seek specialised advice from a qualified financial advisor. The views in this blog are those of the individual and may not represent the general opinion of the firm. Please contact Hewison Private Wealth for more information.