A common question for those nearing, or in, retirement is ‘How much can a pensioner earn before it affects the pension?’. The answer is that it depends on how much income you earn and the total value of your assets, excluding the family home.
This article details the rules of the Age Pension income test, which is one half of the means test used by Centrelink to determine how much Age Pension you could be eligible for.
You must also pass the Age Pension assets test, have reached your eligibility age and satisfy Australian residency rules.
Statistics indicate that the Age Pension income test is passed by fewer Australians than the asset test. According to the Centre of Excellence in Population Ageing Research (CEPAR), approximately two thirds of Australians receiving part pensions have too much income to be eligible for the full pension. The other one third of part-pensioners have too much assessable wealth (assets).
How does the Age Pension income test work?
Centrelink assesses your gross income (that is, your before-tax income) from all sources to determine your eligibility for the Age Pension. These sources include income from overseas, not just Australia. If you have a partner, their income will also be included in your income test assessment.
The current income limits are itemised in the tables below.
