Guide
What are the deeming rates for the Age Pension?
Deeming assumes your financial assets earn 0.25% a year up to $62,600 for a single person ($103,800 for a couple) and 2.25% above that, as at 20 March 2025. That assumed income is counted in the income test whatever your investments actually earn.
Key facts at a glance
- Lower deeming rate: 0.25% a year, applied to the first $62,600 (single) or $103,800 (couple combined) of financial assets.
- Upper deeming rate: 2.25% a year on the balance above the threshold.
- Deeming applies to financial assets only, not to property, cars or contents.
- Account-based pensions started on or after 1 January 2015 are deemed on the account balance.
- Deemed income feeds the income test, where income above $212.00 a fortnight (single) reduces the pension by 50 cents per dollar.
- Deeming rates are set by the Minister for Social Services and can change outside the March and September indexation cycle — confirm the current rate with Services Australia before relying on it.
All figures correct as at 20 March 2025, sourced from Services Australia. Next indexation: 20 September 2026.
How does deeming work?
Instead of tracking the actual return on every account you hold, Services Australia applies a fixed assumed rate to the total value of your financial assets. The first slice up to the threshold is deemed at the lower rate; everything above it is deemed at the upper rate. The two amounts are added together and counted as income.
| Your situation | Lower rate 0.25% applies to | Upper rate 2.25% applies to |
|---|---|---|
| Single | First $62,600 | Anything above $62,600 |
| Couple, at least one receiving a pension (combined) | First $103,800 | Anything above $103,800 |
Which assets are deemed?
- Savings and transaction accounts, term deposits and cash
- Shares, managed funds, bonds and debentures
- Superannuation and account-based pensions once you reach Age Pension age
- Money lent to family, friends or a business
- Gifts above the allowable limits, for five years
Property, vehicles and household contents are not deemed. They still count in the assets test, which is why financial assets are effectively assessed twice: once as assets, once as deemed income.
Deeming Rate Calculator
Enter your financial assets to see the deemed income counted under the income test.
Deeming assumes your financial assets earn a set rate of return no matter what they actually earn. Lower rate 0.25%, upper rate 2.25%.
Estimated result
$81.43 per fortnight
$2,123.00 a year of deemed income counted under the Age Pension income test.
- Deeming threshold
- $62,600
- Deemed at 0.25%
- $62,600 → $156.50 a year
- Deemed at 2.25%
- $87,400 → $1,966.50 a year
This is an estimate based on the published rules and rates of Services Australia, correct as at 20 March 2025. Confirm your actual entitlement with Services Australia — your circumstances may include assessments this tool does not model.
Worked example: Margaret, single, with $200,000 in financial assets
The first $62,600 is deemed at 0.25% — $156.50 a year. The remaining $137,400 is deemed at 2.25% — $3,091.50 a year.
Result: total deemed income of $3,248.00 a year, or about $124.58 a fortnight — below the single income free area of $212.00, so on its own it does not reduce her pension.
Why deeming can work in your favour
Because the deemed rate is fixed, any return above it is invisible to the income test. A term deposit paying more than the upper deeming rate improves your income without touching your pension. The reverse is also true: money sitting in a zero-interest account is still deemed to earn income.
Frequently asked questions
What are the current deeming rates?
The deeming rates are 0.25% on financial assets up to $62,600 for a single person and $103,800 for a couple, and 2.25% on the balance above those thresholds, as at 20 March 2025. Always confirm the current rates on the Services Australia deeming page, because they are set by the Minister and can change outside the usual indexation cycle.
What is deeming, in plain English?
Deeming is a rule that assumes your financial assets earn a set rate of return, and counts that assumed amount as income for the Age Pension income test. If your investments earn more than the deemed rate, you keep the extra without it affecting your pension; if they earn less, you are still assessed on the deemed amount.
Which assets are deemed?
Bank accounts, term deposits, shares, managed funds, bonds, superannuation and account-based pensions once you reach Age Pension age, loans you have made, and gifts above the allowable limits. Physical assets such as property, cars and contents are not deemed — they are counted in the assets test only.
Is my account-based pension deemed?
Yes, for account-based pensions started on or after 1 January 2015, the account balance is deemed rather than assessed on the amount you draw. Some pre-2015 income streams keep the older deductible amount treatment if you have been continuously receiving a payment since then.
Do deeming rates apply to each member of a couple separately?
No. For a pensioner couple, financial assets are combined and the lower rate applies to the first $103,800 of the combined total, with the upper rate on the rest.
How does deeming affect my Age Pension payment?
Deemed income is added to your other assessable income. Once total income passes the free area — $212.00 a fortnight for a single person — your pension reduces by 50 cents per dollar over.
When do deeming rates change?
Deeming rates are set by the Minister for Social Services and can change at any time, often in response to interest rate movements. The deeming thresholds themselves are indexed on 1 July each year.
Can I avoid deeming by keeping money in cash at home?
No. Cash you hold is still an assessable asset and Services Australia will treat it as a financial asset subject to deeming. Deliberately hiding assets is a serious offence and creates a debt when detected.
Researched and fact-checked by
researches Australian retirement and social security policy full time. Not a licensed financial adviser — every figure on this page is sourced from Services Australia or the Social Security Act 1991 (Cth).
Last reviewed: 15 September 2026
Figures as at: 20 March 2025
Next indexation: 20 September 2026
Change log: Reviewed 15 September 2026; deeming rates and thresholds re-checked against the Services Australia deeming page, figures correct as at 20 March 2025. Deeming rates can change between indexations — next scheduled review 20 September 2026.