The Federal Government announced changes to the upper and lower thresholds of the age pension assets and income tests today.
The changes mean that from 1 July, Australians will be able to own and earn more while still qualifying for government support.
Let's go over the changes.
Changes to assets and income test thresholds from 1 July
To be eligible for the pension, you're not allowed to own or earn too much in retirement. This is why the asset test and income test exist.
The tests help determine whether you qualify for a full or part payment or no payment at all.
To keep up with inflation, the pension amount paid and the assets and income test thresholds are indexed.
The Department of Social Services announced the next round of indexation changes to the assets and income tests today.
The pension amount itself is not changing. Indexation changes to the payment itself occur twice per year on 20 March and 20 September.
Let's start with the asset test changes.
How much can you own in retirement and still get the pension?
The assets test incorporates ASX shares, international shares, bonds, investment properties, superannuation, and cash at the bank.
The value of your home is not included in the assets test.
If you do not own your home, you are allowed to own a higher value of assets.
Under the changes, single homeowners will be able to own $321,500 in assets, up from $314,000, and still qualify for the full pension.
If you own assets worth more than $321,500, you will qualify for a part payment if your assets do not exceed $704,500, up from $697,000.
Single non-homeowners will be able to own $579,500 in assets, up from $566,000, and still get the full payment.
If you own assets worth more than $579,500, you will qualify for a part payment if your assets do not exceed $962,500, up from $949,000.
Couple homeowners will be able to own $481,500 in assets, up from $470,000, and still qualify for the full pension.
If you own assets worth more than $481,500, you will qualify for a part payment if your assets do not exceed $1,059,000, up from $1,047,500.
Couple non-homeowners will be able to own $739,500 in assets, up from $722,000, and still get the full payment.
If you own assets worth more than $739,500, you will qualify for a part payment if your assets do not exceed $1,317,000, up from $1,299,500.
How much can you earn?
Under the changes, single pensioners will be allowed to earn $218 per fortnight, up from $212, and still qualify for the full age pension.
If you earn more than $218 per fortnight, you will qualify for a part payment if your income does not exceed $2,516, up from $2,510.
Couple pensioners will be able to earn $380 per fortnight, up from $372, and still qualify for the full payment.
If you earn more than $380 per fortnight, you will qualify for a part payment if your income does not exceed $3,844.40, up from $3,836.40.
How much is the pension?
The single pension, including the supplement payment and the energy supplement, is $1,149 per fortnight.
The couples' pension, including supplement payments, is $866.10 per partner per fortnight.
Australians become eligible for the pension when they reach 'retirement age'.
That's 67 years for people born on or after 1 January 1957.
