The Australian government offers retirees several benefits that you may be eligible for. Two benefits most retirees are entitled to is the Age Pension and The Commonwealth Seniors Health Card. In this article, we will explain both benefits and their respective eligibility parameters.
Age pension
The Age Pension eligibility age in Australia is currently 66 years. This age will progressively increase in six month increments until it reaches the age of 67 for all Australians by 1 July 2023.
In addition to the age requirement, your eligibility for the Age Pension depends on you:
- Being able to satisfy the Age Pension assets test,
- Being able to satisfy the Age Pension income test, and
- Meeting Australian residency requirements.
It is important to understand that your super may be included in both your asset and income tests and can therefore affect your potential Age Pension eligibility. It is also possible to earn up to $300 per fortnight from paid employment without this amount being included in your Age Pension income test. This is known as the work bonus.
The rates for a full Age Pension for Australian residents for the period 20 March 2021 to 19 September 2021 are listed below:
Single: $952.70 per fortnight (approximately $24,770 per year)
Couple (each): $718.10 per fortnight (approximately $18,670 per year)
Couple (combined): $1,436.20 per fortnight (approximately $37,341 per year)
Couples separated due to illness each receive the Single rate (see above), which combined is $1,905.40 (approximately $49,540 per year)
Note: Annual amounts are estimated by multiplying fortnight amounts by 26. The figures above include the pension and energy supplements.
Rates from: https://www.superguide.com.au/in-retirement/age-pension-rates
Age Pension rates for singles and couples (married or de facto) are adjusted every six months based on changes in the Consumer Price Index (CPI), Male Total Average Weekly Earnings, and the Pensioner and Beneficiary Living Cost Index.
The Age Pension is one of the ‘three pillars of retirement income’ in Australia – along with superannuation and private savings. It plays a critical role in retirement income for many, including retirees who are substantially self-funded.
Around two thirds of Australians aged over 66 currently receive at least some Age Pension, with 41% on the full pension and 25% on a part pension. So don’t assume you won’t be eligible – you could be pleasantly surprised!
You can apply for the Age Pension online through your myGov account, over the phone on 132 300 or by visiting your nearest Services Australia service centre. Services Australia may also contact you directly if you are already receiving certain Centrelink payments.
The exact process of applying for the Age Pension will depend on your current circumstances.
Commonwealth Seniors Health Card
The Commonwealth Seniors Health Card (CSHC) is a concessional card that allows you to get cheaper health care and some discounts if you’ve reached Age Pension age.
If you’re eligible, the benefits include:
- medicines listed on the Pharmaceutical Benefits Scheme (PBS) at the concessional rate, and once you reach the PBS safety net, will usually* be supplied with further PBS prescriptions without charge for the remainder of the calendar year,
- bulk-billed GP appointments (at the discretion of the doctor),
- reduced out-of-hospital medical expenses above a concessional threshold of the Extended Medicare Safety Net. The threshold amount for out-of-pocket hospital costs is currently $680.70. If you exceed this, you’ll be refunded 80% of the amount, or the EMSN benefit caps.
- Energy Supplement.
To be eligible for the CSHS you must meet all the following conditions:
- be Age Pension age,
- meet residence rules,
- not be receiving a payment from the Department of Social Services (including the Age Pension) or the Department of Veterans’ Affairs,
- provide a Tax File Number or be exempt from doing so,
- meet identity requirements,
- meet the income test.
You must also provide both your own and your partner’s tax file numbers, unless you’re exempt.
You can apply for a card from the Department of Human Services (via Centrelink) once you’ve reached your Age Pension eligibility age. You will need to provide a range of supporting documents with your CSHC application.
Holding a CSHC doesn’t mean you can forget private health insurance. Although it provides some benefits when it comes to pharmaceuticals, visits to the doctor and additional refunds under the Extended Medicare Safety Net, it’s not a replacement for private health insurance.
Article Sources:
https://www.superguide.com.au/in-retirement/commonwealth-seniors-health-card
https://www.superguide.com.au/in-retirement/age-pension
https://www.superguide.com.au/in-retirement/age-pension-eligible
https://www.canstar.com.au/superannuation/how-to-apply-for-the-age-pension/
https://moneysmart.gov.au/retirement-income/age-pension-and-government-benefits