Centrelink is introducing a change to the income assessment of Defined Benefit Income Streams effective from 1 January 2016. In some circumstances, this change may have a dramatic affect on the level of income being assessed by Centrelink, and therefore, reduce the level of benefit under the income test.
What are the changes and how might you be affected?
Defined Benefit Income Streams
Many Defined Benefit Income Streams may contain an amount of income which is not assessed by Centrelink when applying their income test. This amount is called the deductible amount.
From 1 January 2016 this deductible amount will be capped at a maximum limit of 10% of the income received from the pension.
If the current pension has a deductible amount of 10% or less already, it will retain its existing income treatment.
How does this affect you?
In some circumstances, this change can have a dramatic affect on the level of income being assessed by Centrelink and reduce the level of benefit received under the income test.
Alternately if a person is currently assessed under the assets test, they could inadvertently find they are now assessed under an income test.