Will my partners income have an effect on my part pension ?
I am receiving a small part pension . My partner is under pension age and about to start casual work , a few hours each week , earning up to $120pw . Will this have an effect on my part pension of $90 pf ?
Thanks , I am asset tested .
That's not really correct or complete. Centrelink will apply both the income and assets test, and offer you the smallest of the two pensions so calculated. For the calculations below, I am assuming you are being assessed as a MEMBER OF A COUPLE. Since you receive $90 pfn, your total assessable assets must be $803,500, $409,000 in excess of the maximum amount, $394,500, that you are CURRENTLY allowed in total assessable assets before losing $1.50 pfn for each $1,000 of excess assets. $409,000 is 409 lots of $1,000 which, when multiplied by $1.50 yields $613.50 which, when substracted from the maximum member-of-a-couples pension of $703.50 a fortnight, results in a $90 pfn pension.
I don't know what portion of your assessable assets are financial, so I cannot add your partner's anticipated fortnightly earnings to the income that would be assessed by Centrelink after they apply their deeming rates, in order to provide you with a full comparison of the assets test and income test as they appy to you. The maximum income, FROM ALL SOURCES, that you and your partner may earn before you lose any part of your pension, is $308 pfn. The loss thereafter is 50 cents pfn for every dollar in excess of $308.
I assume that there are no other sources of income - other than deemed earnings from financial assets and your partner's anticipated fortnightly earnings from work.
It's clear however, that currently the assets test gives the lower pension. So that's the one being paid.
Radish. That a terrific and comprehensive reply. Good to see someoene who know what they are talking about ;-)
Radish, that was an impressive reply to JohnP's query, do you take on similar enquiries privately? If you do, just sign me up...that's the first time I have heard an explanation of how the system works so coherently..and it makes me and I am sure others, question whether they are really up to date with their pension entitlements from Centrelink.....
Really good explanation Radish,lot of figures in there that not many of us would know about.But a $90pf part pension,don't sound to GENIROUS to me,as some of our out of total touch with reality beyond their own narrow mined beliefs Ministers have labled the aged pension as.
Really good explanation Radish,lot of figures in there that not many of us would know about.But a $90pf part pension,don't sound to GENIROUS to me,as some of our out of total touch with reality beyond their own narrow mined beliefs Ministers have labled the aged pension as.
Hi Radish,
I think you now lose $3 per fortnight for assets over the threshold. It was $1.50 until january, 2017 I think.
Hi Radish,
I think you now lose $3 per fortnight for assets over the threshold. It was $1.50 until january, 2017 I think.
Well spotted Bren. Maybe Radish would be prepared to redo the figures ??
thank you Radish. Spot on with Total accessible assets. Does that mean that personal and car assets that we have $68,000 are not part of financial assets . And no, there is no other source of income .
Radish it is a mute point how much in finacial assets they have as to only get $90/ftn under the income test it would be in the order of app $2.7 million, which is well over the assets test for a pension. So it was pretty obvious that he was getting $90/ftn part pension and she was just going to start earning $120/week, they were already asset tested by a long way.
In response to the above.
Under the assets test each member of a couple loses $1.50 per fortnight per $1,000 of assets in excess of the $394,500 threshold, if they are being assessed under the assets test. So if only one member of a couple receives the pension, then that member loses $1,50 pfn per $1,000 of excess assets. When their partner qualifies for the pension then the partner will also lose $1.50 pfn for the exact same exess assets. Check with Cenrelink if you don't believe me.
For financial assets at current deeming rates, for a couple, the following applies.
1: First $86,200 is deemed at 1%, or $862 per annum. This works out to be $33.15 pfn.
2: Over $86,200 the deeming rate is 3%. So the limit of fortnightly earnings left over becomes ($308-$33.15)=$274.85 (rounded) pfn. At 3% this works out to be a capital sum of: (($274.85/.03)x26)=$238,200 (rounded to nearest $10). Add back the $86,200 to that and the answer is $324,400 in total financial assets before any pension loss occurs.
The above is based on financial assets being the only source of assessable income, with the current limit of $308 pfn in allowable earnings from all sources, and based on current deeming rates. I also asume that the questioner is a homeowner. Clearly $324,400 is well below the assets threshold of $394,500. It would depend on the value of non-financial assets to be added to the financials, to determine whether the pension applicant would be subject to the assets or income test when Centrelink reviews their application.
The comment from McDaddy is unbelievably silly as assets of $2.7million would not yield a pension of any sort. The current limit for a part pension is total assessable assets of $863,500 for a couple.
And it is not "mute" point, it is "moot" point, but even that is wrong as there is no argument about the set limits; they are fixed by Centrelink/Government.
In response to the above.
Under the assets test each member of a couple loses $1.50 per fortnight per $1,000 of assets in excess of the $394,500 threshold, if they are being assessed under the assets test. So if only one member of a couple receives the pension, then that member loses $1,50 pfn per $1,000 of excess assets. When their partner qualifies for the pension then the partner will also lose $1.50 pfn for the exact same exess assets. Check with Cenrelink if you don't believe me.
For financial assets at current deeming rates, for a couple, the following applies.
1: First $86,200 is deemed at 1%, or $862 per annum. This works out to be $33.15 pfn.
2: Over $86,200 the deeming rate is 3%. So the limit of fortnightly earnings left over becomes ($308-$33.15)=$274.85 (rounded) pfn. At 3% this works out to be a capital sum of: (($274.85/.03)x26)=$238,200 (rounded to nearest $10). Add back the $86,200 to that and the answer is $324,400 in total financial assets before any pension loss occurs.
The above is based on financial assets being the only source of assessable income, with the current limit of $308 pfn in allowable earnings from all sources, and based on current deeming rates. I also asume that the questioner is a homeowner. Clearly $324,400 is well below the assets threshold of $394,500. It would depend on the value of non-financial assets to be added to the financials, to determine whether the pension applicant would be subject to the assets or income test when Centrelink reviews their application.
The comment from McDaddy is unbelievably silly as assets of $2.7million would not yield a pension of any sort. The current limit for a part pension is total assessable assets of $863,500 for a couple.
And it is not "mute" point, it is "moot" point, but even that is wrong as there is no argument about the set limits; they are fixed by Centrelink/Government.
Thanks Radish, you were spot on with my/our total assets. $68,000 inluded in that total is personal assets/car. We earn no other income.
So, in that case, my wife earning up to $120 pf should not have any effect on my part pension ........
Sorry $120 pw
I stand by my comments. We already knew he was only getting $90ftn Pension and was determined by the asset test, didn't have to look at deeming of his financial assets, because as I pointed out he would have to have about $2.7million is financial assets being deemed to only get $90ftn under the Pension income test, and that wouldn't happen, because if he did, he wouldn't be getting any pension. It was very easy to see that a small amount of $120/week wasn't going to impact.
Hi. I will respond with full calculations tomorrow morning. I have visitors now and they ain't going anywhere for many hours tonight. But the short answer is your wife's earnings of $240 pfn (maximum, anticipated) will NOT affect your current pension. Also remember that you can earn more than the deeming rates on your financial assets without any adverse affect on your pension. The idea is that pensioners will seek out the maximum return available to them, subject to their risk appetite. Cheers.
To: BornTooLate.....
Under the Income Test applied by Centrelink the following relates to your pension application.
Total assets of $803,500 less $68,000 for car and personal effects leaves $735,500 as financial assets. The first $86,200 of your financial assets are deemed by Centrelink to earn 1% per annum, ie $862 per annum or $33.15 pfn. The balance of your financial assets, $649,300 ($735,500-$86,200) are deemed by Centrelink to earn 3% pa, ie $19,479 pa or $749.19 pfn. Total deemed earnings are therefore ($749.19+$33.15)=$782.34 pfn. To this we add your wife's anticipated earnings of $240 pfn (let's assume the maximum for the sake of this calculation) which gives you total income pfn from all sources of ($782.34+$240)=$1022.34 pfn. Deduct from this the permitted earnings of $308 pfn leaves you with $714.34 pfn of excess earnings, 50% of which, or $357.17, will be deducted from the maximum fortnightly pension, including supplements, payable to a member of a couple. The maximum pension for each member of a couple is $703.50 pfn.
Thus under the Income Test your pension would be ($703.50-$357.17)=$346.33 pfn. Centrelink does do this calculation automatically.
$346.33 pfn is substantially more than the $90 pfn you receive under the Assets Test ($803,500-$394,500 permitted assets, leaves $409,000 in excess assets, which results in a pension loss of 409 multiplied by $1.50 pfn or $613.50 pfn, giving you a pension of $703.50 pfn minus $613.50 pfn, ie, $90 pfn).
Centrelink always pays the lower pension which, in your case, is the $90 pfn assessed under the Assets Test.
For the above I am assuming, for the sake of simplicity, that your total assets, including financials, do not vary in accordance with the stock market (for example), and that you withdraw earnings from the financials for living expenses, and that you do not withdraw, or add, any capital.
One bright spot. The difference between the pension you would receive under the Income Test and that which you receive under the Assets Test is substantial: ($346.33-$90) which equals $256.33 pfn. So there is considerable scope for your wife and/or yourself to earn more money pfn through work without affecting your current pension. You could earn between you, in total, and in addition to the $240 your wife is anticipated to earn pfn, up to an additional $256.33 multiplied by two, ie up to $512.66 pfn more before the Income Test results in a lower pension than the Assets Test.
Thanks mate, that's great information and answers all my questions. I know we are talking about small amounts here, but happy to understand it now .
Great info from Radish. My only query is that I thought that it was $3.00 pfn for each $1,000 of excess assets, Not $1.50 pfn for each $1,000 of excess assets. But maybe I am confused here ??
Depends on whether you are asset or income-tested, if you are asset tested, then no, income tested then yes.