If you receive or are about to receive an Australian Government pension, there are new asset test levels and taper rates from the start of next year 2017 you need to know about, which could reduce the pension received, as explained at the Humans Services website.
From the first of January 2017, the assets test free area will increase, which means you can own more assets before your pension is affected.
The new asset test free area will increase to:
- $250,000 for a single homeowner
- $375,000 for a homeowner couple
- $450,000 for a single non-homeowner, and
- $575,000 for a non-homeowner couple
This means some may get more in your pension.
At the same time, on the other hand, the taper rate for pensioners will also increase. This will see a reduction in payments for some, while others may have their pensions cancelled.
The family home is still exempt from the assets test.
Asset limits for allowances will also increase. There will be no reduction or cancellation of allowances as a result of this change.
Read more about the asset test limits.
How the change will work
At present, for every $1000 of assets you own above the assets test free area, your pension is reduced by $1.50 per fortnight.
From the first of January 2017, this doubles, to $3.00 per fortnight per $1000.
If your payment is cancelled on the 1st January 2017 as a result of this change, you’ll automatically get a Low Income Health Care Card. If you’re over age pension age, you’ll also get a Commonwealth Seniors Health Card. In this instance, you’ll not have to meet the usual income test requirements for these cards.
Pension Bonus Scheme
If you’re registered for the Pension Bonus Scheme, your bonus depends on the rate of Age Pension you’ll receive when you claim it. This rate may be different before and after 1 January 2017. You may wish to consider this if you have flexibility as to when to claim.
Read more about the Pension Bonus Scheme.
Aged Care Fees
This change may affect your government subsidised aged care fees. This is because your income, including your pension, affects your fees. If your pension is reduced or cancelled, we’ll send you a letter. You’ll receive a separate letter if your aged care fees change.
Read more about aged care means test assessments.
To read more and see a video or transcript explaining the changes, go to this Humans Services website page.
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