Age Pension Guides — Rates, Eligibility and Income & Assets Tests

The Age Pension is Australia’s primary retirement income support payment. It is administered by Services Australia under the Social Security Act 1991 and provides a regular fortnightly payment to eligible Australians who have reached Age Pension age and meet the income and assets tests.

For many Australians, the Age Pension forms part — often a significant part — of their retirement income. Even those with substantial superannuation balances may receive a partial pension under the income and assets tests. Understanding how the Age Pension works is essential for retirement planning.

Age Pension Eligibility Age

The Age Pension age is currently 67 for all Australians, regardless of gender, born on or after 1 January 1957.

You must also have been an Australian resident for at least 10 years in total, with at least 5 of those years being continuous.

Age Pension Rates (FY2025–26)

Age Pension rates are indexed twice yearly — in March and September — to the higher of movements in the Consumer Price Index (CPI) and Male Total Average Weekly Earnings (MTAWE). This ensures the pension at minimum keeps pace with inflation and broadly tracks wage growth.

Fortnightly rates (as at March 2026):

Rates are current as at March 2026 indexation. Check Services Australia for the latest figures after the next indexation.

The annual equivalent of the full single Age Pension (including supplements) is approximately $32,240. For a couple, it is approximately $48,600 combined.

The Age Pension Income Test

The income test reduces the Age Pension by 50 cents for every dollar of income above the income-free area.

Income-free areas (fortnightly)

What counts as “income” for the test

“Income” for Age Pension purposes is broader than just wages. It includes:

• Employment income (wages, self-employment income)
• Investment income (interest, dividends, rent)
• Business income
• Income from trusts
• Deemed income from financial assets (see below)
• Overseas pensions
• Defined benefit pensions from employer super funds

Income from an account-based pension (the most common super drawdown product) is subject to deeming — the actual drawdown amount does not count; instead, a deemed rate of return is applied to the balance.

Deeming rates

Deeming assumes your financial assets earn a set rate of return, regardless of their actual return. This prevents people from holding assets in zero-interest products to minimise assessed income.

Deeming rates (2025–26):

When the full Age Pension cuts out (income test)

As income rises, the pension reduces by 50 cents per dollar above the free area. The pension cuts out entirely at an upper income threshold. For a single person receiving the full pension, the income cut-out point is approximately $56,800 per year.

The Age Pension Assets Test

The assets test reduces the pension by $3 per fortnight for every $1,000 of assessable assets above the threshold.

Assets test thresholds (2025–26)

Pension cut-out thresholds (assets above this = zero pension):

Thresholds are indexed periodically and will change.

Which assets are assessed

Assessed assets include:

• Bank accounts, term deposits and savings
• Shares, ETFs and managed funds
• Account-based pensions and super balances (for both partners at Age Pension age)
• Investment property (at current market value)
• Vehicles (other than one car)
• Caravans, boats and other recreational assets
• Business assets

Exempt assets include:

• The principal home — the home you live in is fully exempt, regardless of its value. This is the most significant exemption in the Australian retirement income system.
• Superannuation of a partner who has not yet reached Age Pension age (exempt until they reach pension age)
• Certain compensation payments
• Some funeral bonds and pre-paid funeral plans (up to a limit)
• The value of certain granny flat arrangements

How Income and Assets Tests Interact

Both tests apply simultaneously, and your pension is reduced by whichever test produces the lower payment. Most pensioners are affected by only one test or the other, but some are affected by both — in which case the lower payment amount applies.

Superannuation and the Age Pension

Superannuation interacts with the Age Pension in two ways:

Accumulation phase (before reaching preservation age): Super is exempt from the Age Pension assets test while you remain in the accumulation phase and have not reached Age Pension age.

Drawdown phase (pension in payment): When super is converted to an account-based pension, the balance is assessed under the assets test, and deemed income is counted under the income test.

This creates an important planning consideration: many Australians are eligible for a partial Age Pension even with significant super balances, because the combined income and assets tests have thresholds that allow partial pension receipt up to the cut-out level. A financial planner can model the optimal drawdown strategy.

Pension Supplement and Energy Supplement

All Age Pension recipients also receive:

Pension Supplement — a consolidated supplement that replaced several previous supplements. Paid fortnightly as part of the pension. Currently approximately $81.60/fortnight (single) and $61.50/fortnight each (couple).

Energy Supplement — a small fixed supplement to assist with energy costs. Currently $14.10/fortnight (single) and $10.60/fortnight each (couple).

Pharmaceutical Allowance and Rent Assistance

Age Pension recipients who are renting privately may receive Rent Assistance — an additional payment based on the amount of rent paid. The maximum rate (single, paying at least the threshold rent) is approximately $211 per fortnight.

A Pensioner Concession Card is automatically issued to full-rate pensioners, providing access to reduced costs for a range of services including prescription medicines under the PBS, state and territory concessions on utilities and transport, and municipal rates reductions.

Commonwealth Seniors Health Card

The Commonwealth Seniors Health Card (CSHC) is available to Australians who have reached Age Pension age but do not qualify for the Age Pension due to income (note: the assets test does not apply to the CSHC). It provides:

• Concessional prescription medicines under the PBS
• Bulk billing incentive for GPs (at GP’s discretion)
• Access to a range of state and territory concessions

CSHC income threshold (2025–26):

The CSHC income test uses adjusted taxable income plus deemed income from account-based pensions. Higher-income self-funded retirees who miss the Age Pension threshold may still qualify for the CSHC.

Planning Around the Age Pension

The Age Pension is not simply a fallback for those with no savings — it is a means-tested entitlement that interacts with superannuation, investments and other assets in complex ways. Key planning considerations include:

• Principal home exemption: The home is fully exempt from the assets test regardless of value. This strongly advantages homeowners in the pension system.
• Account-based pension deeming: Actual drawdown amounts from super are irrelevant — deeming rates apply to the balance. Drawing down super reduces the assessed asset, potentially increasing pension entitlement.
• Gifting rules: Giving away assets to reduce assessable assets is subject to “gifting rules.” You can gift up to $10,000 per financial year (and $30,000 over 5 years); amounts above this continue to be counted as an asset for 5 years.
• Timing of super access: The interaction between your super balance, pension eligibility and CSHC eligibility makes timing of retirement and super access an important planning consideration.

Frequently Asked Questions

Can I work and still receive the Age Pension? Yes. The income test applies, so employment income will reduce the pension. But many pensioners work part-time and receive a partial pension — the combined income can be higher than either alone up to the cut-out threshold.

Does my partner’s super count in the assets test? If your partner is below Age Pension age, their super is exempt from the assets test. Once they reach Age Pension age, both partners’ super balances are assessed.

When should I apply for the Age Pension? Apply up to 13 weeks before you reach Age Pension age — Services Australia can begin processing your application and aims to have your payment start on your eligible date without a gap.

Can I receive the Age Pension if I live overseas? You may receive a portable Age Pension overseas (indefinitely in some countries, or for up to 26 weeks in others) depending on whether Australia has a social security agreement with the country you’re moving to, and how long you’ve lived in Australia.

Guides in This Section

• Age Pension Australia — Complete Guide
• Age Pension Eligibility Age
• Age Pension Rates (Current Fortnightly Amounts)
• Age Pension Income Test
• Age Pension Assets Test
• Commonwealth Seniors Health Card

Rates and thresholds change regularly. Always verify current information at Services Australia. For retirement income advice tailored to your situation, speak with a licensed financial adviser.

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