From 1 January 2017, the assets test free area and the assets taper rate will increase for all means tested income support payments.

The new measures won’t affect the large majority of pensioners. However, Centrelink may reduce or cancel your client’s pension if they have significant assets (excluding the family home) when the changes are in place.

From 1 January, pensioners will be able to own more assets before it affects their pension. The assets test free areas are increasing to:

• $250,000 for a single homeowner, up from $209,000;
• $375,000 for a homeowner couple combined, up from $296,500;
• $450,000 for a single non-homeowner, up from $360,500; and
• $575,000 for a non-homeowner couple combined, up from $448,000.

The fortnightly taper rate will increase from $1.50 to $3 for every $1,000 above the new assets test free areas. Your client may see a reduction in their pension if their assets are over:

• $291,000 for a single homeowner;
• $453,500 for a homeowner couple combined;
• $539,500 for a single non-homeowner; and
• $702,000 for a non-homeowner couple combined.

Your client may get an increase in their pension if their assets are below these amounts.

In December 2016, the Department of Human Services will send pensioners who may be affected a letter to advise them of changes to their pension from 1 January 2017.

If the change is likely to affect your client’s pension, you may wish to inform them and discuss how it may impact their financial situation.

If your client loses eligibility for the pension as a result of the changes, the Department of Human Services will automatically issue them a Low Income Health Care Card.

If they are over Age Pension age on 1 January 2017, we’ll also issue them a Commonwealth Seniors Health Card. Those under Age Pension age can also apply for a Commonwealth Seniors Health Card when they reach Age Pension age.

They’ll be exempt indefinitely from the usual income test requirements for these cards.

Go to www.humanservices.gov.au for updated information, including the new pension indexation rates.