Age Pension Asset Test: What Counts and What Doesn't

General information only. This is not tax, financial or financial-counselling advice. Assets test limits and cut-off points are set by the Australian Government and change during the year. Confirm current figures with Services Australia before relying on them.

The Age Pension assets test adds up almost everything you and your partner own, ignores your principal home, and once you go over a limit that depends on whether you own your home and whether you are single or a couple, your fortnightly payment is reduced by 75 cents for every $250 worth of assets. Above a higher cut-off point the pension stops altogether. The assets test and the income test are both run on your circumstances, and the one that gives the lower payment is the one that applies.

That last point catches people out. A retiree with modest deemed income often assumes the income test is the only hurdle, when the assets test is the one reducing the payment.

What counts as an assessable asset

Services Australia says it assesses all asset types, valued at what you would get if you sold them at market value, less any debt secured against the asset. For a couple, the assets of both partners are added together whoever owns them.

Assets that count include:

• Financial investments: bank, building society and credit union accounts, cash, term deposits, shares, managed funds, bonds and money you have loaned to someone.
• Home contents, personal effects and vehicles: furniture, appliances, jewellery, laptops, motor vehicles, boats and caravans.
• Real estate other than your home: property you rent out, leave vacant for any length of time, let someone live in for free, or live in when you are not at your principal home.
• Superannuation once you are over Age Pension age, or earlier if you receive payments from it.
• Cryptocurrency, valued at market value, and business assets held through a sole trader, partnership, private trust or company, based on your share and level of control.
• Gifted assets that fall outside the gifting limits (see below).

Two reporting thresholds matter in practice. You need to tell Services Australia when the value of your assets rises by $2,000 or more for financial assets, or by $1,000 or more for non-financial assets. Share prices and market-linked investments are revalued automatically twice a year, so those swings do not need to be reported one by one.

What is exempt

The big exemption is your principal home. Services Australia describes it as the home you live in plus the first 2 hectares of land it is on, and the land must be on a single title. Land beyond 2 hectares is normally counted, as is any part of the home you use only for business. Farms follow separate rules for rural customers and primary producers.

If you sell your principal home, the proceeds you plan to use to buy, build or renovate a new home can be exempt from the assets test. For sales from 1 January 2023 the exemption runs up to 24 months, with a possible further 12, to a maximum of 36 months. Sale money you do not intend to put into a new home is a financial asset from day one.

Superannuation is also left out while you are under Age Pension age, unless you are drawing a payment from it.

The limits: homeowner or not, single or couple

These are the assets limits for a full pension, which Services Australia publishes as the point where your pension starts to reduce. The couple figures are for both partners combined.

Non-homeowners get a higher limit because the principal home is exempt, so a homeowner’s biggest asset never enters the test.

The taper and the cut-off

Above the limit, your fortnightly payment is reduced by 75 cents for every $250 worth of assets, which is the Department of Veterans’ Affairs wording and works out at three dollars for every thousand. It keeps reducing until the part pension reaches nil at the cut-off point. From 20 September 2026 the cut-off points are:

Pensioners getting Rent Assistance have a higher cut-off, and transitional rate pensioners have their own, lower figures. Check the current tables on the Services Australia assets test page for your case.

Worked example: income test says full pension, assets test says otherwise

Take a single homeowner with a bit under a hundred thousand dollars in the bank, a few hundred thousand dollars of other assessable assets (say an investment property’s net value, a car and household contents), and no other income. The home itself is exempt. Together the assessable assets come to a little over the single homeowner limit of $333,000, by well over a hundred thousand dollars, and well short of the cut-off of $745,750.

• Income test: the bank balance is deemed to earn a modest amount, spread over the year it comes to well under the single free area of $226 a fortnight, so the income test takes nothing off.
• Assets test: every 250 dollars over the limit costs 75 cents a fortnight, so an excess of well over a hundred thousand dollars takes several hundred dollars a fortnight off.

The assets test gives the lower payment of the two, so it applies, and the person receives a part pension. Someone who only checked the income test would expect the full rate. The assets test calculator turns your own asset values into the exact fortnightly figure.

Income test or assets test: which one applies

Both tests produce a pension rate and you are paid the lower one. The income test for a single person leaves $226 a fortnight free and then takes 50 cents for every dollar above that. Couples have a combined free area of $396 a fortnight, and each partner’s pension reduces by 25 cents for each dollar over it. Financial assets are not counted at their balance for the income test. They are deemed to earn a set rate, which is why large savings feed both tests at once.

Roughly speaking, people with heavy employment or other income are held down by the income test, and people with a lot of capital that earns little are held down by the assets test.

Gifting and deprivation

Giving assets away does not remove them from the test unless you stay within the gifting free areas: $10,000 in one financial year, and $30,000 over 5 financial years, which cannot include more than the single-year amount in any one year. The limits run by financial year and are the same for singles and couples.

If you give away more, the excess is counted in your assets test and deemed in your income test for 5 years from the date of the gift. Selling something for less than it is worth also counts as a gift. It is not a gift if you receive adequate consideration, or if you are spending to meet normal costs such as home improvements or a holiday. Use the gifting calculator to see how much of a planned gift would be assessed.

When the values change

The full-pension limits are reviewed on 1 July. The cut-off points are derived from the maximum pension rate, so they also move at the 20 March and 20 September pension indexation. The figures above apply from 20 September 2026, and the next scheduled pension indexation is 20 March 2027. Until Services Australia publishes new tables, treat any future figure you see quoted as an estimate, not an official number.

What to do now

1. List everything you and your partner own and note which items are exempt.
2. Put realistic market values on the rest, less secured debt.
3. Compare the total with the limit for your situation, then work out the taper.
4. Run the income test as well, because the lower result is what you are paid.
5. Plan any gifts or large purchases before you spend, not after.

The Age Pension assets test calculator does steps 3 and 4 for you. If you are affected by hardship because of the assets test, Services Australia has asset hardship provisions and the Home Equity Access Scheme.