Why the Change Matters
From 20 September 2025, the government is increasing Centrelink deeming rates – the first change in five years. For many retirees, this shift could have a direct impact on Age Pension entitlements and eligibility for concessions such as the Commonwealth Seniors Health Card, Low Income Health Care Card, and Rent Assistance.
The New Deeming Rates from September 2025
Deeming rates are used by Centrelink to assess income from your financial investments, regardless of the actual return you earn. Until now, retirees have benefited from historically low rates. From September, the lower deeming rate will rise to 0.75% (up from 0.25%), and the upper rate to 2.75% (up from 2.25%).
How This Affects Your Pension
For singles, the income test will now begin to reduce pension payments once financial investments reach $252,800, compared with nearly $309,000 before 20 September 2025. For couples, the income test will start to apply from $436,509, down from $481,500. In other words, many retirees will see their assessable income rise on paper, even if their actual investment returns haven’t changed.
This adjustment could mean a reduction in pension payments or changes in eligibility for certain benefits. It’s estimated that around 460,000 Age Pensioners, plus thousands receiving DVA and other income support payments, will be affected.
Important Assumptions
The information above assumes that both singles and couples are homeowners, and that their only assets are financial investments subject to deeming. Your circumstances may differ, so it’s important to seek personalised advice.
What You Can Do Now
While this change may feel like yet another squeeze on household budgets, it also highlights the importance of proactive planning. Reviewing your investment strategy, cash holdings, and Centrelink entitlements now can help minimise surprises.
At Synectic, our advisers are here to guide you through these changes. If you’re concerned about how the new deeming rates might affect you, reach out – we’d love to help you plan with confidence.
