Age Pension age is 67 from 1 January 2024

Article published on: 13-12-2023

From 1 January 2024, anyone who hasn’t already attained Age Pension age will do so upon turning age 67. This applies to clients born on or after 1 January 1957. This is due to the increase in Age Pension eligibility age from 66.5 to 67 years on 1 July 2023 (the final increment in increasing pension age from age 65 to 67). 
 

Advice considerations

It is important to consider the various aspects that relate to Age Pension age when providing advice including (but not limited to): 

• Superannuation accumulation interests: Super in accumulation phase is not assessed under the income or assets tests for an income support payment if the person is under Age Pension age. Upon attaining Pension age, super is assessed as an asset and deemed under the income test. Using super for one member of a couple who is under Age Pension age may increase their partner’s eligibility for the Age Pension. This can include the Age Pension recipient withdrawing funds from their super to contribute to their spouse’s account (subject to the contribution caps). Gifting and deprivation does not include amounts transferred between members of a couple. 
• Transfer to Age Pension: Prior to attaining Pension age, Centrelink will invite those on Carer Payment or Disability Support Pension to transfer to the Age Pension. Clients will then need to advise Centrelink if they want to transfer to Age Pension or stay on Carer Payment or Disability Support Pension. For assistance in deciding whether to transition to Age Pension, refer to our article Age Pension vs Carer Payment or Disability Support Pension.
• Work Bonus: All Centrelink pensioners over Age Pension age are eligible for the Work Bonus if they have income from work. Under the Work Bonus, the first $300 of fortnightly income from work is not assessed under the pension income test. Any unused part of the $300 fortnightly Work Bonus accrues in the Work Bonus income bank (up to the maximum Work Bonus income bank balance of $11,800) and can be used to offset future work income.
• Seniors and Pensioners Tax Offset (SAPTO): Upon attaining pension age, Australian taxpayers generally become eligible for the Seniors and Pensioners Tax Offset (SAPTO). This tax offset helps reduce tax payable on personal taxable income.
• Commonwealth Senior Health Card (CSHC): The CSHC assists qualifying senior Australians with health care costs and concessions offered by Government bodies and certain private companies. The card is generally accessible for those of Age Pension age who are ineligible for the Age Pension and Pensioner Concession Card, subject to satisfying an income test.
• Home Equity Access Scheme: Upon attaining pension age, pensioners and self-funded retirees may be able to access the equity in Australian property under the Government’s Home Equity Access Scheme (HEAS). 
• Termination payments: An employee must be less than their Age Pension age at the time of dismissal for a redundancy payment to qualify as a genuine redundancy payment (receives concessional tax treatment). Where dismissal occurs after Age Pension age: 
  • the employee is not entitled to a tax-free amount of a genuine redundancy payment 
  • the entire payment is taxed as an ETP, and 
  • unused Annual Leave and Long Service Leave payments are subject to less favourable tax rates. 

Age Pension applications can be made 13 weeks prior to an individual reaching Age Pension age. It is advisable to apply as soon as possible. Applications can be made online (via myGov) or a paper-based form. Apart from the age requirement, there are also other rules that need to be met including residency rules, the income test and asset test. 

More information on the Age Pension qualification can be found in our Age Pension qualification requirements and portability article. This adviser article outlines the requirements that need to be met to become and remain eligible for the Age Pension, as well as the portability rules that apply to determine ongoing eligibility when a pensioner is overseas.

Further information is also available through Services Australia.