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Age Pension, Disability Pension and Carer Payment…which one suits me?!

Heading into retirement can, and should be an exciting time in your life. However, there is a lot to consider and especially with Centrelink planning it can become overwhelming.

The more common payments they provide are Jobseeker, Disability Support Pension (for those unable to work due to a long term condition), Carer Payment (full-time carers), Carer Allowance (providing daily care for someone), and Age Pension (those over age pension age). Each have different income or asset tests that apply to determine what payment you will receive.

For those currently receiving a disability support pension, or carer payment Centrelink will email or post a letter to provide the option to transfer to the age pension 13 weeks before reaching age pension age. Clients will need to advise Centrelink what option they wish to take, and then provide some updates on assets including funds held in superannuation. 

Deciding if you should retain your existing payment, or transfer to the age pension will depend on your personal circumstance, and there can be advantages to receiving either payment. Similarly, if you are over age pension age you may be unsure what payment would be in your best interests to apply for. The solution is to speak with a financial adviser so they can consider your overall financial position, and decide what is the best option for you. The below table helps compare some of the key features of each payment.

FeaturesAge PensionDisability Support PensionCarer Payment
Payment rate

Same maximum basic rate of payment

Work Bonus

If over Age Pension age all benefits eligible for work bonus

Income & Asset TestSame income and asset testSame income and asset test as Age Pension. A special income and asset test applies if the care receiver has no income support payment.
TaxableYesYes after pension ageYes after carer and care recipient are Age Pension age

Rent Assistance

Reduced rateHigher rateHigher rate
RespiteNot applicableNot applicable

63 days per calendar year

International portability Yes, no restrictionsYes, but restrictionsYes, but restrictions
Mobility Allowance Yes

Yes, higher rate

Not applicable

Study Assistance 

NoYesYes
Ongoing MedicalNo care related reviewsOngoing medical requests and reviewsOngoing review of care giver and receivers circumstances for qualification
Employment/Study limitationsNo limitationsAllowed to engage in partial employment up to 30 hrs p/wCan work up to 25hrs per week, including travel time
Extended Land UseYesNoYes, if over Age Pension age
Carer Supplement

Not for age pension

Yes if have Carer Allowance

Not applicable

Supplement paid for both carer payment and allowance

Bereavement Payment availableYes, if both receiving income support for 12 months priorYes, if both receiving income support for 12 months priorYes to carer, if care receiver is single or their partner is not receiving a payment
Author
Financial Planner AFP® | M.FF | Authorised Representative No. 401525

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