From 20 September 2025, the Australian Government will increase the deeming rates used to calculate income from financial assets for Centrelink and DVA income-support payments.
This is the first change in five years, and it could affect how much Age Pension, Disability Support Pension, or Veteran Payment you receive. If you’re unsure what this means for your personal situation, The Hrkac Group’s Financial Planning Advisers can help you understand and prepare for these changes. Here’s what the new Centrelink deeming rates mean for pensioners, retirees, and veterans, and how The Hrkac Group can help.
What Are Centrelink Deeming Rates?
Deeming rates are used by Centrelink and the Department of Veterans’ Affairs (DVA) to estimate how much income you earn from financial assets like bank accounts, shares, and superannuation. Instead of looking at your actual earnings, the government assumes a set rate of return.
From 20 September:
- The lower deeming rate will rise from 0.25% to 0.75%.
- The upper deeming rate will rise from 2.25% to 2.75%.
These rates apply to:
- Singles: First $64,200 of financial assets at the lower rate; anything above at the upper rate.
- Couples: First $106,200 combined at the lower rate; anything above at the upper rate.
Who Will Be Affected?
About 460,000 Age Pensioners and thousands more on DVA and other income support payments will be impacted. If you’re receiving a part pension and have financial assets, your deemed income will increase, which could reduce your pension or other income support payment.
For example:
A single homeowner with $300,000 of financial assets receives the full pension. However, after 20 September 2025, their maximum pension will reduce by $25 per fortnight because of the increased deeming rates.
The new deeming rates mean your deemed income will be higher, so your pension may reduce sooner than before. However, the government is also increasing pension rates through indexation, which may offset some of the impact.
The new deeming rates mean your deemed income will be higher, so your pension may reduce sooner than before. However, the government is also increasing pension rates through indexation, which may offset some of the impact.
Selling Your Home? You May Get an Exemption
If you sell your principal home and plan to buy, build, or renovate a new one, the sale proceeds can be exempt from the assets test for up to 24 months.
During this time:
- You’ll still be assessed as a homeowner.
- The exempt funds will be deemed at the lower rate only (0.75 % from 20 September).
This exemption helps retirees who are downsizing or relocating avoid losing their pension while they transition to a new home.
What You Can Do
• Review your financial assets and income.
• If you’ve sold your home, notify Centrelink to apply the exemption.
• Seek advice if you’re unsure how the changes affect you.
How The Hrkac Group Can Help
Navigating Centrelink rules and pension thresholds can be complex. Our experienced Financial Planning Team
can:
- Review your assets and income to assess potential impacts.
- Advise on strategies to minimise reductions to your payments.
- Support you with Centrelink correspondence and applications.
You don’t have to manage these changes alone,
book an appointment with one of our Geelong Financial Planing Advisers today to ensure you’re making informed financial decisions.
The content within this blog has been sourced from our Licensee, Alliance Wealth’s blog ‘Realise Your Dream’.
General Advice Warning
This information has been provided as general advice. We have not considered your financial circumstances, needs, or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement (PDS) and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication. Whilst all care has been taken in the preparation of this material, it is based on our understanding of current regulatory requirements and laws at the publication date. As these laws are subject to change you should talk to an authorised adviser for the most up-to-date information. No warranty is given in respect of the information provided and accordingly neither nor its related entities, employees, or representatives accepts responsibility for any loss suffered by any person arising from reliance on this information.
