Here’s what’s changing with Centrelink payments in Australia Starting September 20, 2025 the government will make changes that affect many people who get Centrelink support. They are updating the deeming rates for the first time in five years. These rates show how much money the government thinks you earn from your savings and investments. This change will impact people who get payments like the Age Pension and JobSeeker. The new rates could change how much money you receive from Centrelink each fortnight. Deeming rates are used to figure out your income from things like bank accounts & shares. The government uses these rates to work out if you can get payments & how much you should get. The change might mean some people will get less money from Centrelink. Others might not see any difference. It depends on how much you have saved and what kind of investments you own. If you get Centrelink payments you should check how these changes might affect you. You can talk to Centrelink or a financial advisor to learn more about your situation.
Understanding Deeming Rates: How Your Savings Impact Your Pension
The government has a system to figure out how much money you make from your savings and investments. They don’t look at what you actually earn. Instead they use set rates to guess your earnings from things like bank accounts term deposits and shares. They call this “deeming.” When you apply for benefits like the pension Centrelink uses these assumed earnings to decide if you can get payments and how much you’ll receive. They look at money you have in bank accounts savings accounts managed funds & super funds if you’re old enough. This system makes it simpler for everyone. The government doesn’t need to track your real investment returns and you don’t need to report every change in your earnings. They just use these standard deeming rates to work everything out. The text is now more conversational uses simpler words and has shorter sentences. It explains the same concept but in a more straightforward way.
Current Deeming Rates Explained: What Has Stayed the Same Since 2020
| Group | Assets up to threshold | Rate | Assets over threshold | Rate |
|---|---|---|---|---|
| Singles | First $64,200 | 0.25% | Balance above $64,200 | 2.25% |
| Couples (combined) | First $106,200 | 0.25% | Balance above $106,200 | 2.25% |
Upcoming Deeming Rate Changes: What September 20, 2025 Brings
Important changes are coming to deeming rates. The rates have been frozen but will now go up. The lower rate will increase from 0.25% to 0.75%. The upper rate will increase from 2.25% to 2.75%. These changes will affect how income is calculated for pension purposes.
| Group | Assets up to threshold | New Rate | Assets over threshold | New Rate |
|---|---|---|---|---|
| Singles | First $64,200 | 0.75% | Balance above $64,200 | 2.75% |
| Couples (combined) | First $106,200 | 0.75% | Balance above $106,200 | 2.75% |
Why Centrelink Is Adjusting Deeming Rates Now: Key Reasons Explained
During COVID-19 the government kept deeming rates low to help older people and those on benefits.
– After that the Reserve Bank started raising interest rates.
-They went from a very low 0.10% up to 4.35% by the end of 2023.
– Prices went up fast & reached their highest point of 7.8% in late 2022.
– But now things are better and inflation is down to 2.1% as of June 2025.
– The economy is more stable now so the government thinks deeming rates should go up too.
– Tanya Plibersek who is the Social Services Minister says these new rates are more fair.
She thinks they show what pensioners can actually earn from their savings these days.
Who Will Feel the Impact? Pensioners and Account Holders Affected
Many Australians will get different payment amounts starting soon.
– This affects over 771000 people.
– The biggest group is older people on Age Pension, with about 460,000 people affected.
– There are also 96,000 people on JobSeeker & 62,000 people getting Disability Support Pension who will see changes.
– Parents and others on various benefits will also notice some differences.
If you have money in the bank or other investments your benefits might go down a bit because Centrelink will think you’re earning more from these savings.
Preparing for the Change: Practical Tips to Protect Your Pension
Check what you own & tell Centrelink about it.
– They need to know about your bank accounts and any money you have saved up.
– Don’t forget to include your super and other investments too.
– You can use the tools on the Centrelink website to see how the new rates might change your payments.
– These calculators are easy to use and free. It’s a good idea to talk to someone who knows about money.
– You can speak with a financial planner or ask for help at Centrelink.
They can tell you what choices you have. Keep in mind that some payments will go up on September 20. This happens because of regular increases that might help balance out any other changes to your payments. The text is now more straightforward and easier to understand.
