A new Centrelink rule, which came into effect on 1 January, makes it easier for older Australians to work.
Under the new rule, if you receive employment income, Services Australia can now temporarily suspend your Age Pension payment rather than cutting it off completely and forcing people to reapply.
“We can do this if your employment income goes over the cut-off point for more than six fortnights in a row,” Services Australia says.
“We can do this for up to two years. This means that you don’t have to reclaim if you start earning less, or stop working.”
Read: Can I live in a de facto relationship and still get a full Age Pension?
The new rule is actually less onerous than the previous one, which required you to resubmit your Age Pension claim after your payments had stopped. Under the old rule, payments were cut off completely if you exceeded income limits for six consecutive fortnights. You would then have to resubmit an application for the Age Pension.
Currently, singles receiving the Age Pension can earn up to $190 per fortnight, and couples up to $336. If you earn less than that, the difference can be banked in what’s known as the Work Bonus income bank, which can be used to reduce reportable income at a later date.
The Work Bonus can be built up to a maximum of $11,800 this calendar year, which means you can potentially earn more than $450 extra per fortnight, up to the maximum amount, before your Age Pension payments are affected.
On 1 December 2022, the maximum Work Bonus balance increased by $4000, taking the total possible balance from $7800 to $11,800. The top-up will stay until 31 December 2023.
Read: Work Bonus increase extended until end of 2023
But if you exceed those amounts, that is where the new suspension rules will kick in and you could lose your pension – at least temporarily.
“You don’t need to ask us to suspend your payment, we’ll do this automatically,” says Services Australia. “When this happens, we’ll write to you to let you know. We’ll tell you the dates of the period we can suspend your payment for.
“You won’t need to report your employment income while your payment is suspended.”
Read: Will Australia be forced to raise the retirement age?
The rates of many government support payments also went up on 1 January – but unfortunately the Age Pension wasn’t one of them.
But those who receive the Disability Support Pension or the Carer Payment, the payment will rise by $38.90 a fortnight for singles and $58.80 for couples.
The Age Pension is not set to be reviewed until it receives the first of its biannual indexation adjustments in March.
Will these new rules affect you? Would you like to see Age Pension payments reviewed more regularly than twice a year? Let us know what you think in the comments section below.
Hi Brad – Can I query one item in your article? My wife and I are both 69 but my wife is on Disability Support pension while I am on Age pension. We both have identical small part British pensions and so we receive identical part pensions of currently $703.25 per fortnight. My wife’s DSP did not increase on the last payment on 4 January as you suggest. Is that right?
You should contact Centrelink, not solicit personal advice here from someone who is a digital content writer, albeit one with experience in writing about aged pensions. That unfortunately does not make him an expert who can give you advice on your personal circumstances.
This g all previous Federal Governments – have become “BIG BROTHER!!”
I know that NONE of these idiots who make the rules, will EVER be on the Pension, but at least they could relax the Pension Income rule – to allow “those of us – WHO CAN – and WHO WANT TO, can go out and earn some extra money for things like I need now, a new car transmission, some new tyres and a “new hip!!”
BUPA want $490 a month for 12 months before I can even apply to have a new hip so that I can work!!
Would love to see these parliamentarians have to go through that!!
The income and assets means test needs to be totally abolished for all pension payments permitting pensioners to work without restriction. If the politicians of this country can work and still receive their full pension, then so should those of us who put them in power.
Our country will become a much better place to live if our politicians would only stop being so openly and blatantly greedy.
Absolutely agree David! I find it incredible that one has to declare assets – essential appliances etc- As if we are all going to go out and sell things that we rely on for everyday life ! They are not assets; they are essentials. Even a car to some is an essential – if you live in the country and there is no other transport e.g. you are not going to sell your car and profit by the sale ! The amount of time Centrelink spends on assessing age pension claims – up to 9 months – during which time the person who has applied is put through the most appalling frustration and worry with constant requests for further information etc is the most soul destroying process I have ever been through. It is a national disgrace. Their level of communication and transparency is abysmal.
Don’t know about the $11,800 max. I did my reporting just now and my balance is $12,100
I think the bi-annual review of the pension is all that is needed. I am managing to live comfortably at present. While I expect to be paid an adequate pension , I do not believe that “the world owes me a living”.
I’m 65 and work part time. My wife is 72 and receives a part aged pension due to my income. They want me to work full time next year. Do the suspension rules apply to me working full time?
Thank you
Bruce