Deeming Rates for Age Pension Assessment

The amount of Age Pension that you are entitled to is determined by an Income Test and an Assets Test (assuming that you meet all other eligibility criteria).

The Assets Test is broadly all of your investment assets (this excludes your main residence).

The Income Test is based on all of your sources of income or ‘deemed’ income.

‘Deeming’ is the term used for the rate at which Centrelink assume certain investment assets earn an income – regardless of what they actually earn.

The Deeming rates for Age Pension assessment generally apply to all investment assets excluding an investment property, superannuation pensions and annuities.

Centrelink Income Assessment of Investment Properties

The income assessed for an investment property is the rent that you receive, less expenses relating to the property.

How to Manage Your Super Without Paying a Financial Adviser

Download our 6-step checklist & take control of your super

Centrelink Income Assessment of Pensions and Annuities

The gross value of the income received from a Pension or Annuity is reduced by a Deductible Amount. The net amount is then counted as income towards the Centrelink Income Test.

The Deductible Amount is basically calculated by dividing the purchase price of the Pension or Annuity by the term or life expectancy factor.

More information on the Centrelink Deductible Amount Formula.

More information on changes to Centrelink Deductible Amount as of 1 Jan 2015 – account based pensions

More information on changes to Centrelink Deductible Amount as of 1 Jan 2016 – defined benefit pensions

Deeming Rates for Age Pension Assessment

The Deeming rates for Age Pension assessment for most other investment assets are shown in the table below (as of 29 Jan 2014):


Single Deeming Rate
First $46 600 2% p.a.
Amount over $46 600 3.5% p.a.


Member of a Couple Deeming Rate
First $77 400 2% p.a.
Amount over $77 400 3.5% p.a.

For example, if you are a member of a couple and had $200,000 in cash and term deposits, the first $77,400 would be assumed to earn 2% p.a. ($1,548 p.a.) and the remaining $122,600 would be deemed to earn 3.5% p.a. ($4,291 p.a.). Combining these amounts, $5,839 income would be deemed to be earned from these investments for Centrelink Age Pension purposes.

If this $200,000 had in fact earned in excess of this amount, the excess would not be counted towards the Income Test assessment. Conversely, if your investments had earned less than this amount, Centrelink would still count the ‘deemed’ amount as part of the Income Test assessment.

Deeming Rates for Age Pension Exclusions

There are a few exclusions for deeming of investments under the Income Test.

These exclusions may include:

  • Where a financial investment has failed
  • Some superannuation investments where funds are fully preserved or inaccessible

If you believe that you have an asset that should be excluded from the deeming provisions, you should contact Centrelink. The best number for Age Pension recipients is 132 300 Mon- Fri 8am – 5pm.

If you would like anything clarified or have any further questions about the Deeming Rates for Age Pension Assessment or any other topics, please do not hesitate to leave a comment.

Chris Strano

Hi, I hope you enjoyed reading this article. If you want my team and I to help with your retirement planning, click here. If you prefer a DIY approach, then check out the SuperGuy HUB. Thanks for stopping by - Chris.

More Posts




  1. Mandy

    If I have $200,000 in superannuation at the age of 66 , will I have enough from the aged pension to supplement my annual income to around $35,000 per annum for 20 years ?
    Thank you for your help

    The M in Mandy is lower case for my email address.

    • Chris Strano

      Hi Mandy
      Here are some calculators that can assist with your retirement planning

      The current maximum single rate of Aged Pension is around $20,000 p.a. (assuming you are eligible for the full Age Pension). You will therefore need to draw approximately $15,000 p.a. (increasing with inflation) from your superannuation if you have no other source of income. The earnings rate on your superannuation will determine how long you will be able to do this.

      You should consider speaking to a financial planner for personal advice. Unfortunately I am unable to provide you with personal advice and there are too many variables involved in your question for a straight answer.


Submit a Comment

Your email address will not be published. Required fields are marked *