Age Pension Assets Test Explained: A 2026 Family Guide
The Age Pension is the largest single income source for most retired Australians — but the rules around eligibility are complex. Two tests apply: the Income Test and the Assets Test. Centrelink uses whichever produces the lower pension. This guide focuses on the assets test, which catches out the most families because the rules around the family home, gifts, and deeming are often misunderstood.
Understanding the assets test matters because crossing a threshold by even a small amount can reduce the pension by thousands of dollars per year. Understanding it also matters because innocent moves — gifting money to grandchildren, downsizing the family home, or selling investments — can have unexpected Centrelink consequences. This is general information, not financial advice. Speak to a Centrelink Financial Information Service officer (free) before major decisions.
The Assets Test Thresholds (2026)
Below the lower threshold, you receive the full pension. Above the upper threshold, you receive nothing. In between, the pension reduces by $3 per fortnight for every $1,000 above the lower threshold.
| Situation | Lower (full pension) | Upper (cut off) |
|---|---|---|
| Single homeowner | $314,000 | $697,000 |
| Single non-homeowner | $566,000 | $949,000 |
| Couple homeowner (combined) | $470,000 | $1,047,500 |
| Couple non-homeowner (combined) | $722,000 | $1,299,500 |
Thresholds adjusted twice yearly (March, September) by Services Australia. Always check current figures at servicesaustralia.gov.au.
What Counts as an Asset
Counted Assets
- • Bank accounts, term deposits
- • Shares, managed funds, ETFs
- • Superannuation in pension phase
- • Investment properties
- • Cars (current market value, not original)
- • Caravans, boats, motorbikes
- • Holiday houses
- • Furniture & contents (typically $5,000–$20,000)
- • Jewellery, antiques, collections
- • Loans you've made to family
- • Trust assets (in some cases)
Exempt Assets
- • Family home (principal place of residence)
- • Pre-paid funeral & funeral bond up to $15,500
- • Reasonable home contents at market value
- • Aids/equipment for disabled persons
- • Special disability trusts (up to $789,250)
- • Some compensation lump sums (time-limited)
- • Granny flat right (within rules)
Deeming: How Centrelink Treats Your Money
Centrelink doesn't actually look at the interest your bank account earns. They “deem” an income amount based on a fixed rate. This deemed income then counts in the income test (separate from the assets test).
| Status | First $X assessed at lower rate | Above that at higher rate |
|---|---|---|
| Single | First $62,600 at 0.25% | Above at 2.25% |
| Couple combined | First $103,800 at 0.25% | Above at 2.25% |
Deeming rates can change with government policy. The 0.25%/2.25% rates have been in place since 2020.
Gifting Rules: The Trap Many Families Fall Into
$10,000 / $30,000 Rule
You can gift away up to $10,000 in any year, OR $30,000 over 5 years (whichever is less), without Centrelink consequences. Gifts above this are still counted as YOUR asset for 5 years from the date of the gift. This is called “deprivation” in Centrelink language.
Examples that count as gifting:
- • Giving cash to children/grandchildren
- • Selling something for less than market value
- • Cancelling a debt owed to you by family
- • Adding family member to title without payment
- • Loaning money you don't expect to be repaid
- • Paying for grandchildren's school fees in lump sum
The Family Home: Special Rules
Currently Living There
Family home is fully exempt from assets test. Property size doesn't matter (extreme high-value homes still exempt). This is why some retirees have $5M homes but receive full pension.
Moving Into Aged Care
If you move into residential aged care and your spouse remains in the home, it stays exempt. If you're single and move into care, the home is exempt for 2 years. After 2 years, it counts as an asset (impacting your pension and your aged care fees).
Downsizing
Selling the family home to a smaller one: the proceeds (cash) IS counted as an asset until you reinvest in a new home. The 24-month exemption rule applies if you commit to buying within that window.
Granny Flat Right
If you transfer the family home (or contribute funds) to a child's home in exchange for a right to live there for life, this can be exempt — but only if structured properly. See our Granny Flat Right Guide.
Common Mistakes Families Make
- • Underdeclaring contents: Centrelink knows people lowball furniture. Be realistic. $5,000–$20,000 typical for single home.
- • Forgetting investment property mortgage: Net equity counts (value minus loan).
- • Declaring car at original price: Use current market value (Redbook, Cars Sales).
- • Not declaring overseas pensions: NHS pension, NZ super, foreign assets must be declared.
- • Family loans treated as gifts: If you loan to family without proper documentation and repayment schedule, Centrelink may treat as a gift.
- • Pre-paid funerals > cap: Only $15,500 exempt; excess counts.
Getting Free Help
Centrelink's Financial Information Service (FIS) is free, independent, and excellent. FIS officers can talk through your specific situation without selling anything. They are not financial planners but explain how Centrelink rules apply.
| Resource | Contact |
|---|---|
| FIS (Financial Information Service) | 132 300 (free) |
| Centrelink Older Australians | 132 300 |
| National Seniors Australia | 1300 765 050 |
| National Debt Helpline | 1800 007 007 |
| Aged Care Steps | agedcaresteps.com.au — specialist financial planners |
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