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Changes to Deeming Rates
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Changes to Deeming Rates

By March 11, 2026No Comments

From 20 March 2026, the Government will increase social security deeming rates again following the last increase on September 2025. This change closely follows a recent rise to cash rate from the Reserve Bank of Australia.

Deeming rates are used to estimate income from financial assets (like bank accounts and superannuation) when assessing eligibility for payments such as the Age Pension.

 

Current and new rates

Deeming rates

Income thresholds

Current

New

Singles

Couples

0.75%

1.25%

First $64,200

First $106,200

2.75%

3.25%

Above $64,200

Above $106,200

The Government plan to gradually increase deeming rates back to pre-COVID levels, given this we expect to see further increases in the near future.

 

Who will this impact?

An increase in deeming rates could reduce benefits and entitlements for those who:

  • Receive income-tested pensions

    • Where deemed income impacts the Income Test assessment. This may include recipients who are currently full pension or allowance recipients, or currently asset tested, but may become income tested once the deeming rates increase.

  • Commonwealth Seniors Health Card (CSHC) holders who have an account-based income stream that is deemed

    • With non grandfathered account based pensions (ABP), as deemed income from these ABPs form part of the CSHC income test.

  • Low Income Health Care Card holders

    • Where higher deemed income may push them above the relevant income threshold.

  • Those in aged care

    • Support at Home and residential aged care, as the same income and asset assessment rules for deemed financial investments apply across aged care and social security means testing.

 

Impact on asset levels for Age Pension

Those receiving a single age pension would need to hold over $213,000 in financial assets before their Age Pension started to reduce.

Those receiving a couple combined age pension would need to hold over $369,000 in financial assets before their Age Pension started to reduce.

Common financial assets include, but not limited to – bank accounts, superannuation if you are over the age pension age, annuities and income streams, money loaned, shares, investment properties, real assets.

 

What do you need to do?

There is no action required, Services Australia will automatically apply the new deeming rates to your financial assets.

 

What can you do?

If you’re unsure how this might affect your entitlements, or would like to take advantage of the changes, have a discussion with your financial adviser to ensure you’re making the most from your situation.

 

Information in this article is of a general nature only and has not been tailored to your personal circumstances. Information in this article reflects our understanding of relevant regulatory requirements and laws etc as at the date of issue, which may be subject to change. Please seek personal advice prior to acting on this information.