Working after pension age
The Australian Government is assisting older Australians to work, if they are able and wish to do so, by allowing them to keep more of their pension when they have income from work.
Seniors may have substantial income from work and still receive a pension (Age Pension, Disability Support Pension, or Carer Payment). For those over Age Pension age, the application of the pension income test and the Work Bonus provide an incentive to work.
Work Bonus
Under the Work Bonus, the first $300 of fortnightly income from work is not assessed as income under the pension income test. Any unused amount of the fortnightly $300 Work Bonus will accumulate in a Work Bonus income bank, up to a maximum amount of $7,800.
The amount accumulated in the income bank can be used to offset future income from work that would otherwise be assessable under the pension income test. The income bank amount is not time limited; if unused it carries forward, even across years.
Note: from 1 December 2022 to 31 December 2023, a one-off, temporary credit of $4,000 applies to Work Bonus income bank balances. The maximum income bank balance increases to $11,800 over this period. On 1 January 2024, the maximum income bank balance will automatically reset to $7,800.
For more information go to the Work Bonus factsheet.
Pension Income Test
The pension income test is designed to encourage pensioners to supplement their pension with additional private income. A pensioner can receive an amount of private income before their pension rate starts to reduce. This is the income free area which, from 20 September 2022, is $190 for single-rate pensioners and $336 for couples (combined). For each dollar of income above the income free area, the single pension is reduced by 50 cents.
For further information about the income free area and the amount of private income a pensioner may receive before their pension rate reduces to zero, please refer to Services Australia.
More information for seniors in the workforce
- Australian Taxation Office – information for seniors and retirees on tax concessions.
- Australian Human Rights Commission – information about age discrimination.
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