Centrelink Benefits Increase from March 20, 2025 March 10th, 2025

Modest Increase in Pension Payments

Australia’s slowing increase in the cost of living has resulted in a modest rise in Centrelink benefits, effective from 20 March. This increase will also see thousands of Netplan followers with substantial assets qualify for a part pension for the first time.

The upper cut-off thresholds for both the income and asset means test have increased as a result of higher pension rates. This change allows more people to qualify for benefits.

A single age pensioner will see an increase of $4.60 per fortnight to $1,149, while couples will receive an increase of $3.50 each, bringing the total fortnightly payment to $866.10 per person or a combined $1,732.20 per fortnight.

How Pension Increases Are Calculated

Pension increases are tied to one of three variables. Age pensions must always be at least 25 per cent of Male Total Average Weekly Earnings, measured in November of the previous year. This figure is then compared with the increase in the Consumer Price Index (CPI) and the Pensioner and Beneficiary Living Cost Index, applied to the current pension rate.

For this increase, the six-month CPI rise to the end of December returned a figure of 0.4 per cent, which was the number used.

Higher Cut-Off Levels for Part Pension Eligibility

An increase in the pension rate also raises the effective cut-off levels for eligibility for a part pension.

Due to the way the system is structured, even those who qualify for a minimal part pension receive the full supplement payments that form part of the total fortnightly payment. This ensures that all pension recipients receive additional financial support, regardless of the size of their base pension.

This means a single pensioner cannot receive anything less than $59.10 per fortnight, while couples receive $44.50 each or a combined $89 per fortnight.

Similarly, part pensioners are entitled to receive the mauve pensioner concession card, which provides discounts on state and local government charges and services.

These may include reduced rates on electricity, water, and transport, as well as concessions on vehicle registration and health services, potentially saving recipients thousands of dollars annually.

Income Cut-Off Limits from 20 March

From 20 March, the upper cut-off income level for a single pensioner increases to $2,510 per fortnight. This figure includes before-tax employment income, foreign income, certain superannuation pension income, and deemed income from financial investments.

For couples, the combined income cut-off limit will be $3,836.40 per fortnight.

Because Centrelink treats couples as a single entity, it does not matter in whose name the income is received. This approach ensures that financial resources are assessed fairly across both partners, preventing individuals from shifting income between accounts to alter their eligibility.

This figure also does not include the work bonus scheme, where seniors can earn up to $300 per fortnight from employment before their pension is reduced at a rate of 50 cents per dollar. If unused, the work bonus credit builds up each fortnight to a maximum of $11,800 per person. If you undertake part-time work, you can use up your credit before it affects your pension payments.

For example, if you decide to work during the federal election and have a work bonus credit, you may not lose any age pension, despite earning hundreds of dollars.

However, note that unused work bonus credit cannot be transferred to your partner.

Asset Test Thresholds Increasing

The 20 March increase also affects the upper cut-off threshold under the asset test.

A home-owning single pensioner can now have assets of up to $697,000 and still receive a part pension.

Couples who own their home can have assets of up to $1,047,500 and still qualify.

The value of your home, on land up to two hectares, is completely ignored. Above this land area, Centrelink attributes a value to the excess land.

The only exception to this rule applies if you have lived on a property for more than 20 years and it is on a single title. Additionally, the land must be fully utilised, taking into account its size, your abilities, and other relevant factors.

However, only the land is exempt - stock, plant and equipment, and the value of crops are not.

For non-homeowners, the asset test thresholds increase by $252,000.

Applying for a Pension Increase

If you think you might qualify after 20 March, you can lodge your application now, as you are within 13 weeks of your eligibility date.

The easiest way to apply is via the Services Australia website.

Pension Rates and Means Test Thresholds

Effective 1st July, 2024

Note: Couples separated by illness (e.g., one partner living in aged care) each receive the single rate: $2,298.00

Means Test

Home Owners Limits

Non-Home Owners Limits

Income Test