Understanding the Age Pension income test

Super and investments 101 | Date Posted: 6 December 2023

When you retire, you may be eligible for government benefits, such as a (part) Age Pension. To qualify, you need to be a permanent Australian resident, be of pension age and pass an income and an assets test. Once both the income test and assets test are assessed, whichever awards you the lower rate will be used for your Age Pension payments. Should you not pass one of the tests, then you’re not eligible to receive the Age Pension. 

We previously unpacked what’s included in the assets test. In this article we shine a light on the income test. 


About the Age Pension income test

The income test helps the government work out if you’re eligible to receive an Age Pension, and if so, how much you’d get. It includes an amount you earn or receive, as well as profits and some regular payments you may get as a gift or allowance. It can either be money or in the form of goods or services. If your income is above a certain limit, you won’t be able to receive Age Pension payments.

Income limits

For an overview of the standard rules, which apply to most pensions go to the Services Australia website. Here, you’ll find the fortnightly income limits for a single or a couple to receive a full Age Pension. If you receive more than the fortnightly limits, you may still receive a part Age Pension, as long as your income does not exceed the income limits for a part Age Pension. The amount of Age Pension you’re eligible for reduces by 50c for every dollar earned over the income limit for the full Age Pension.

What’s included in the income test

Examples of items in the Age Pension income test include:

  • Investment income such as dividends
  • Rental income from investment properties
  • Income from superannuation pensions or annuities
  • Royalties and commissions
  • Payment for work you do
  • Deemed interest from bank accounts and super

The actual amount of income from some of these may be hard to assess. That’s why the government uses 'deeming rules' in some cases to come up with standard rates of income. For example, the income you receive from your account-based pension may not be what Centrelink use in their income calculation. For more information about the role of pensions and what you’ll need to tell Centrelink, head to the Services Australia website.


About deeming 

Deeming is a way for the government to make an estimate of what you're likely to earn from things such as investments. Deeming uses your estimated future income earnings, regardless of what you might actually earn from them. The Minister for Social Services sets the deeming rates, which reflect expert advice about what the markets are doing.
Did you know? If you’re an eligible pensioner, the Work Bonus may help you earn more income from working without reducing your pension.

What’s not included

Exempt income is not included in the income test. Exempt income can be:

  • Rent assistance from the government
  • Most payments from Services Australia - these may still count in the Family Tax Benefit income test
  • Compensation for loss or damage to things you own
  • Child support - this may still affect your Family Tax Benefit Part A
  • Any free board and lodging you get
  • Regular payments from a close relative
  • Emergency relief or similar assistance
  • Payments as a victim of National Socialist persecution
  • First Home Saver Account withdrawals or interest
  • Repayment for expenses
  • Some allowances if you spend the whole amount on what it’s meant for, for example, work travel
  • Payments through a National Disability Insurance Scheme (NDIS) package
  • Some lump sums

How much you can get

How much Age Pension you get depends on your income and assets tests, and whether you're single or a couple and own your own home or not. If you don’t qualify for a full Age Pension, you may still get a part Age Pension. For an overview of the current rates, visit the Services Australia websiteRemember, the income test is only one part of the Age Pension eligibility test, so make sure you also meet the assets test and other eligibility criteria. 

Did you know? If you get the Age Pension, there are other payments and support you may be eligible for. Find out more on the Services Australia website.

Turn to Mine

If you have any questions about the Age Pension or your Mine Super account, you can reach us on 13 64 63, Monday to Friday, 8am to 6pm, or email We can also put you in touch with Mine Super Financial Advice for additional support to help you decide what’s right for you. Mine Super members are entitled to a complimentary appointment. And did you know? Advice on how your account is invested is at no extra cost, but there are fees associated with providing personal financial advice. During your appointment your adviser will discuss the fees and how you’d like to proceed. 

Meet the team or request an appointment with Mine Super Financial Advice.