Age Pension in Australia: Eligibility, Assets Test, Income Test, and How Much You Can Receive (2026)

To receive the Age Pension, you must satisfy several eligibility criteria:

• Age: The qualifying age for the Age Pension is currently 67 for both men and women. This applies to anyone born on or after 1 January 1957. Check your qualifying age on the Services Australia website if you were born before this date.
• Residency: You must be an Australian resident and physically in Australia when you claim. You must also have been an Australian resident for at least 10 years in total, with at least 5 of those years being continuous residency. Some international social security agreements affect these requirements.
• Means tests: You must satisfy both the assets test and the income test. Both tests are applied, and the one that results in the lower pension payment determines your rate.
• How to apply: Apply through Centrelink via myGov. You can submit a claim up to 13 weeks before reaching pension age. Processing can take several weeks - apply early. Gather financial records, asset valuations, and superannuation statements before applying.

Payment rates are indexed and updated in March and September each year:

• Single: Maximum Age Pension rate of approximately $1,144.40 per fortnight ($29,754 per year) including Pension Supplement and Energy Supplement.
• Couple (combined): Maximum of approximately $1,725.20 per fortnight ($44,855 per year) combined, or approximately $862.60 each.
• Indexation: Rates are indexed to the higher of CPI, Male Total Average Weekly Earnings (MTAWE), or the Pensioner and Beneficiary Living Cost Index - providing some real-terms protection against inflation.
• Pension Supplement: Included in the above rates - covers phone, internet, and pharmaceutical costs. A minimum Pension Supplement is paid even if you are below the standard threshold.
• Rent Assistance: Available on top of the base pension for eligible renters. Check the current rates on the Services Australia website as this is updated regularly.

The assets test measures your financial and non-financial assets and reduces your pension entitlement accordingly:

• Full pension thresholds (assets below this receive maximum pension): For a single homeowner approximately $314,000; single non-homeowner approximately $566,000; couple homeowner approximately $470,000; couple non-homeowner approximately $722,000 (2025-26 approximate figures - check Services Australia for current rates).
• Pension cutout thresholds (assets above this receive no pension): For a single homeowner approximately $695,500; single non-homeowner approximately $947,500; couple homeowner approximately $1,045,500; couple non-homeowner approximately $1,297,500.
• Taper rate: Between the lower and upper thresholds, the pension reduces by $3 per fortnight for every $1,000 of assets above the lower threshold.
• What is counted: Financial assets (bank accounts, shares, super balances for those over pension age, investment properties), personal assets (car, caravan, boats - at market value), and business assets. The family home you live in is exempt regardless of value.
• What is not counted: Your principal place of residence (the family home), some pre-paid funeral expenses, and certain lifestyle assets below thresholds. Gifted assets may still be counted under the deprivation rules for 5 years.
• Superannuation: For people under Age Pension age, their super balance is generally not counted in the assets test. Once you reach pension age, your super balance is assessed.

The income test assesses your regular income from all sources and reduces the pension by 50 cents for every dollar above the free threshold:

• Free area (income below this receives maximum pension): Approximately $212 per fortnight for singles; $372 per fortnight combined for couples (2025-26 approximate).
• Pension cutout income: Approximately $2,444.60 per fortnight for singles; $3,737.60 combined for couples.
• What is assessed: Employment income (with a work bonus for pensioners who work - first $300 per fortnight exempt), rental income, interest and dividends, business income, and deemed income from financial assets.
• Deeming: Rather than assessing actual returns on financial investments, Centrelink applies a deemed rate of return - currently 0.25% on the first $62,600 (single) or $103,800 (couple) of financial assets, and 2.25% on the remainder (2025-26 rates - check Services Australia). This applies to bank accounts, shares, managed funds, and account-based super pensions.
• Work Bonus: Pensioners who work can earn up to $300 per fortnight (plus an annual credit of $11,800 that can accumulate) without it affecting their pension income test. This incentivises part-time work in retirement.

There are legal strategies to maximise Age Pension entitlement that are within the rules of the system. Spending on exempt assets (renovating the family home, prepaying funeral costs, purchasing a new car) reduces assessable assets. Gifting is limited - you can give away up to $10,000 per financial year (up to $30,000 over 5 years) without it being counted as a deprived asset; amounts above this are assessed for 5 years. Salary sacrifice or spouse contributions to a younger partner's super (below pension age) can reduce the older partner's assessable assets while the funds remain outside the means test.

However, these strategies must be balanced against your actual retirement needs. Optimising for maximum Age Pension at the expense of having the assets you need to live comfortably is counterproductive. The pension is a supplement to your own retirement savings - not the goal itself. A financial adviser with retirement and Age Pension expertise can model the optimal drawdown and asset strategy for your specific situation.

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