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4.2.3 Pensions & Benefits Assets Tests & Limits


This section contains one topic that describes the assets test as it applies to pensions AND to benefits. This section covers the following matters:

  • the pensions assets test,
  • how assets reduce pension payments,
  • the benefits assets test,
  • payments affected by the benefits assets test,
  • assets value limits, and
  • asset disposal by a care receiver.


Pensions assets test

The pensions assets test applies to all pensions. The assets test is only applied where a person's assets exceed the allowable limits for full pension. If assets exceed the allowable limits pension entitlement is assessed by:

  • calculating the rate payable under the assets test, and
  • comparing that with the rate payable under the income test.


The assets test only applies if it produces a lower rate of payment than the income test. The following table shows the 4 steps involved in applying the assets test for pensions.




Determine the value of the person's assets (1.1.A.290).


Determine the person's assets value limit.


Does the value of the person's assets exceed their assets value limit?

- If NO, the person's assets excess is NIL.

- If YES, the difference is the ASSETS EXCESS.


Determine the reduction for assets

- Divide the assets excess by 250.

- Round the result DOWN to a whole number.

- Multiply the whole number by 9.75.



Act reference: SSAct section 1064-G1 Effect of assets on maximum payment rate, section 1064-G3 Assets value limit, section 1064-G4 Pension reduction for assets in excess of assets value limit


How assets reduce payments

From 20 September 2007, every $1,000 in assets over the asset value limits reduces a pensioner's pension rate by $1.50 per fortnight (single or couple combined).

Note: Prior to 20 September 2007, every $1,000 in assets over the asset value limits reduced a person's pension rate by $3.00 per fortnight (single or couple combined).


Special arrangements have been introduced to assist people making a pension claim in the 3 months following the introduction of the change. These arrangements are outlined in


Benefits assets test

The allowance assets test is not the same as the pension assets test. Payments affected by the allowance assets test are NOT payable if a person's assets exceed those limits.


Payments affected by the benefits assets test

The following payments are affected by the benefits assets test:

  • newstart allowance,
  • youth allowance,
  • partner allowance,
  • MAA (granted after 1 July 1996),
  • austudy payment,
  • widow allowance,
  • sickness allowance,
  • special benefit, and
  • parenting payment (single).


PPP is not affected by the benefits assets test. It has its own assets test as set out in SSAct section 500Q.


Act reference: SSAct section 500Q Assets test-payment not payable if assets value limit exceeded


Assets value limits

Information on current assets free areas and assets value limits can be obtained from the payment rates page on the Centrelink Internet site.


These limits are indexed from 1 July each year.


Legislation covering the operation of the assets test and the assets value limits is contained in the relevant qualifications and payability, or rate calculator sections of the SSAct.


Carer payment - disposal of assets by care receiver

If a care receiver disposes of assets, the value of the disposed assets can be maintained as an asset if the care receiver:

  • does not receive adequate payment for the assets, or
  • disposed of the assets for the primary purpose of enabling a carer to qualify for CP.


These situations are NOT likely to occur in most care receiver cases. These provisions DO NOT apply to any disposition before 9 May 1995, the date the change to CP eligibility on this basis was announced.


Act reference: SSAct section 198F Disposal of assets - care receiver assets test, see 198F to 198M

Policy reference: SS Guide 4.1 Deprivation of Income & Assets, 4.2.5 CP Income & Assets Tests


Last reviewed: 12 August 2013


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Last Edited: 13/09/2013 8:29:56 AM

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