Guide
Age Pension Income Test 2026
A single person can have $212.00 a fortnight of assessable income before the Age Pension reduces, and a couple $372.00 combined, as at 20 March 2025. Above that you lose 50 cents per dollar, with payment stopping at $2,510.00 a fortnight for a single person.
Key facts at a glance
- Income free area as at 20 March 2025: $212.00 a fortnight single, $372.00 a fortnight combined for a couple.
- Taper rate: 50 cents of pension lost per dollar of income over the free area.
- Cut-off: $2,510.00 a fortnight single, $3,836.40 a fortnight couple combined.
- The Work Bonus excludes the first $300 a fortnight of employment income on top of the free area.
- Financial assets are not assessed on actual returns — deeming applies instead (Services Australia).
- Couples are assessed on combined income, with the reduction shared equally.
All figures correct as at 20 March 2025, sourced from Services Australia. Next indexation: 20 September 2026.
What is the Age Pension income test?
The income test measures your assessable income each fortnight and reduces your Age Pension once it passes the free area. Assessable income is not the same as taxable income: it includes deemed income you never actually receive, and it excludes things a tax return would count, such as superannuation lump sums.
| Your situation | Full pension up to | Part pension cuts out at | Taper |
|---|---|---|---|
| Single | $212.00 | $2,510.00 | 50c per dollar |
| Couple (combined) | $372.00 | $3,836.40 | 50c per dollar combined (25c each) |
What counts as income for the Age Pension?
- Employment income and self-employment profit, after the Work Bonus
- Deemed income from financial assets — bank accounts, shares, managed funds, account-based pensions
- Net rental income from investment property
- Overseas pensions and foreign income
- Income from defined benefit pensions, above the deductible amount
- Distributions from private trusts and companies you control
- Certain compensation and insurance payments
What is not counted as income?
- Actual interest or dividends from financial assets — deeming replaces them
- Lump sum superannuation withdrawals
- Emergency relief payments and some one-off government payments
- Rent Assistance and other supplements you receive
Income Test Estimator
Add your employment and other income to see what the income test does to your fortnightly payment.
Estimated result
$1,054.60 per fortnight
Under the income test alone, before the assets test is applied.
- Employment income counted after Work Bonus
- $0.00 per fortnight
- Total assessable income
- $400.00 per fortnight
- Income test free area
- $212.00 per fortnight
- Reduction (50c per dollar over)
- − $94.00
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: David, single, working two days a week
David is 68, single, earns $700.00 a fortnight from part-time work, and has $150,000 in financial assets deemed at about $83.00 a fortnight.
The Work Bonus removes the first $300 of his wages, so $400.00 of employment income counts. Adding deemed income gives assessable income of $483.00 a fortnight.
That is $271.00 over the free area, so his pension reduces by half of that — $135.50 a fortnight.
Result: $1,013.10 a fortnight under the income test, before the assets test is compared.
How to work out your assessable income
- Add employment income for the fortnight, then subtract the Work Bonus exemption and any income bank balance.
- Calculate deemed income on all financial assets using the current deeming rates.
- Add net rent, foreign pensions and trust distributions.
- Subtract the free area for your situation.
- Halve what remains — that is your fortnightly reduction.
- Subtract the reduction from the maximum rate for your situation.
Reporting income
If you or your partner work, you generally report employment income to Services Australia each fortnight through myGov, the Express Plus Centrelink app or the phone service. Other income changes must be reported within 14 days. Getting this wrong is the most common cause of a pension debt, so report when income is paid, not when it is earned.
Frequently asked questions
How much can I earn before it affects my Age Pension?
A single person can have $212.00 of assessable income a fortnight before the Age Pension reduces, and a couple $372.00 combined, as at 20 March 2025. Employment income also gets the Work Bonus, which excludes a further $300 a fortnight.
How much pension do I lose per dollar of income?
You lose 50 cents of Age Pension for every dollar of assessable income above the free area. For couples the 50-cent reduction applies to combined income and is shared, so each partner loses 25 cents per dollar.
At what income does the Age Pension stop?
The Age Pension cuts out at $2,510.00 a fortnight of assessable income for a single person and $3,836.40 a fortnight combined for a couple, as at 20 March 2025.
Is income from my savings counted?
Not the actual interest. Financial assets such as bank accounts, shares and account-based pensions are assessed using deeming, which assumes a set rate of return whether you earn more or less than that.
Does rent from an investment property count as income?
Yes. Net rental income counts, calculated as gross rent less allowable expenses such as rates, insurance, repairs and interest on the loan. Capital works deductions and depreciation are not allowed as deductions by Services Australia.
Does my partner's income affect my Age Pension?
Yes. Couples are assessed on combined assessable income against the couple free area, even if only one of you receives the pension.
Is a withdrawal from my superannuation counted as income?
No. Lump sum withdrawals from super are not counted as income, though the money stays in the assets test wherever you put it. Account-based pensions are assessed through deeming rather than by the amount you draw.
Which test applies if the assets test gives a different answer?
Services Australia calculates your rate under both tests and pays the lower of the two. The test producing the lower rate is your binding test and can change over time as your circumstances change.
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; income free areas, cut-offs and the 50-cent taper re-checked against Services Australia figures correct as at 20 March 2025. Next update at the 20 September 2026 indexation.