Income test for pensions

How the income test works

Financial assets are deemed to earn income, while there are different assessment rules for other types of income.

Most pensions, allowances and concession cards have income and asset limits, or both. These determine if your income affects the amount of pension you receive.

This income test is effective from 1 July 2014 and applies to the following payments and family situations:

  • Age Pension
  • Wife Pension
  • Widow B Pension
  • Bereavement Allowance
  • Carer Payment
  • Disability Support Pension

You are exempt from this income test if you are permanently blind and you get Age Pension or Disability Support Pension and you do not receive Rent Assistance.

Single, couple combined, illness separated (couple combined) pensioners

Single

Fortnightly incomeup to $160over $160
Reduction in paymentnone – full payment50 cents for each dollar over $160

Couple combined, illness separated (couple combined)

Fortnightly incomeup to $284over $284
Reduction in paymentnone – full payment50 cents for each dollar over $284 (combined)

Transitional rate pensioners

The income test for transitional rate pensioners is effective from 19 September 2009.

Single

Fortnightly incomeup to $160over $160
Reduction in paymentnone – full payment40 cents for each dollar over $160

Couple combined, illness separated (couple combined)

Fortnightly incomeup to $284over $284
Reduction in paymentnone – full payment40 cents for each dollar over $284

Allowable income is increased by up to $24.60 per fortnight for each dependent child

Disability Support Pension

Single

  • Under 21, single, no children, 16-17 years (at home)
  • Under 21, single, no children, 18-20 years (at home)
  • Under 21, single, no children, 16-20 years (independent)
Fortnightly incomeup to $160over $160
Reduction in paymentnone – full payment50 cents for each dollar over $160

Couple combined

  • Under 21, member of a couple, no children, under 18 years
  • Under 21, member of a couple, no children, 18-20 years
Fortnightly incomeup to $160over $160
Reduction in paymentnone – full payment50 cents for each dollar over $160

Single, saved status

  • Under 21, single, no children, saved status, 16-17 years (at home)
  • Under 21, single, no children, saved status, 18-20 years (at home)
  • Under 21, single, no children, saved status, 16-20 years (independent)
Fortnightly incomeup to $160over $160
Reduction in paymentnone – full payment40 cents for each dollar over $160

Couple combined, saved status

Fortnightly incomeup to $284over $284
Reduction in paymentnone – full payment40 cents for each dollar over $284

The income test for saved status is effective from 19 September 2009.

Employment income is subject to a Work Bonus for eligible pensioners over age pension age.

Cut-off points

If you earn enough income your payment reduces to $0, this is called the cut-off point. This table outlines the cut-off point for each family situation.

The amount of income you can earn before your payment reduces to $0 may be higher if you are eligible for Rent Assistance.

Disability Support Pension

If you arepayment reduces to $0 once your fortnightly income reaches this amount
Single$1,845.60
Couple (combined)$2,825.20
Illness separated (couple combined)$3,655.20
Under 21, single, no children, 16-17 years (at home)$874.20
Under 21, single, no children, 18-20 years (at home)$967.60
Under 21, single, no children, 16-20 years (independent)$1,255.80
Under 21, member of a couple, no children, under 18 years$2,463.20
Under 21, member of a couple, no children, 18-20 years$2,463.20
Under 21, single, no children, saved status, 16-17 years (at home)$1,052.75
Under 21, single, no children, saved status, 18-20 years (at home)$1,169.50
Under 21, single, no children, saved status, 16-20 years (independent)$1,529.75
Couple (combined), saved status$3,008.00

Other pensions

  • Age Pension
  • Wife Pension
  • Widow B Pension
  • Bereavement Allowance
  • Carer Payment (caring for a person 16 years or over)
  • Carer Payment (caring for a child under 16 years)
If you arepayment reduces to $0 once your fortnightly income reaches this amount
Single$1,845.60
Couple (combined)$2,825.20
Illness separated (couple combined)$3,655.20
Transitional rate pensioners – Single$1,944.25
Transitional rate pensioners – Couple (combined)$3,162.00
Transitional rate pensioners – Illness separated (couple combined)$3,852.50