Understanding the Age Pension Assets Test Before You Retire

"Will I still qualify for the Age Pension?" is one of the first questions people ask themselves as retirement gets closer. It's a fair question, and the honest answer is that it depends on more than your super balance. Centrelink weighs up both an income test and an assets test, and your payment is based on whichever one produces the lower result. Understanding how it works can help you make clearer decisions about your home, super, investments and spending well before you stop work.

How the Age Pension Assets Test Works

The assets test looks at what you and your partner own and how much it's worth, and determines whether you receive the full Age Pension, a part pension, or none at all. If you're part of a couple, Centrelink assesses your combined assets against a single combined limit rather than looking at you separately.

As at 1 July 2026, the full pension asset limits are:

Situation	Homeowner	Non-homeowner
Single	$333,000	$600,000
Couple, combined	$499,000	$766,000

Above these limits, your pension starts to reduce gradually until you reach the part pension cut off, where payments stop altogether:

Situation	Homeowner	Non-homeowner
Single	$733,500	$1,000,500
Couple, combined	$1,102,500	$1,369,500

Homeowners have lower limits than non-homeowners because the principal home is usually exempt and isn't counted as an asset at all. A couple with $500,000 in super might sit comfortably within the part pension range as homeowners, while the same balance as renters faces a higher limit plus ongoing housing costs. Comparing super balances between households rarely tells the full story.

The full pension limit is set each July, and the part pension cut off moves again whenever pension rates are indexed in March and September, so these numbers can shift more than once a year. The current limits are always listed on Services Australia's assets test for Age Pension page.

What Counts as an Asset, and What Doesn't

Your home is the main exclusion, typically including the house itself and up to two hectares of surrounding land. Almost everything else you or your partner own, in Australia or overseas, is assessed at current market value, from bank accounts and shares to investment properties, business interests and self managed super funds. Services Australia's asset types page lists the full picture.

That exemption comes with limits. Moving into a retirement village, entering aged care, or selling your home before buying another one can all change how it's treated. 

Downsizing is a common example worth thinking through, if you sell your home for $1 million and buy a new one for $700,000, the remaining $300,000 may become an assessable asset, though proceeds earmarked for a new home can often stay exempt while you arrange the purchase, currently up to 24 months with a possible extension. Services Australia's real estate assets page sets out the current exemption period. Selling the family home to simplify retirement can still affect your pension, so it's worth working through the numbers first.

Superannuation and the Age Pension Assets Test

Superannuation is built to fund your retirement, but how Centrelink treats it depends on your age. Before Age Pension age, currently 67, super held in accumulation usually isn't counted as an asset at all, though converting it into an income stream earlier, such as a transition to retirement pension, can make the balance assessable straight away. From Age Pension age onward, your super, any account based pension and other retirement income streams typically become relevant to both the assets test and the income test, which uses a method called deeming to estimate the income your financial assets produce, regardless of what they actually earn.

The goal isn't simply to hold fewer assets so the pension looks bigger on paper, since what helps under one test won't necessarily help under the other. The more useful question is how to draw a sustainable retirement income from the Age Pension, super and other savings together.

Gifting Money and the Assets Test

Giving money to family, whether that's a deposit for your child's first home, forgiving a loan, or a straightforward gift, doesn't automatically remove it from Centrelink's assessment. Gifting up to $10,000 in a financial year, or $30,000 over five years, usually won't affect your assessment. Above those limits, the excess is typically treated as a deprived asset and continues to count under both the assets test and income test for five years from the date of the gift. Services Australia's how much you can gift page has the current limits. None of this means gifting is off the table, only that timing and size are worth thinking through.

If you'd like a clearer picture of how your own home, super and other assets might play out under the assets test, wherever you are, book your free 10-minute Discovery Call at hunterfp.com.au.

Frequently Asked Questions

Is my home counted in the Age Pension assets test? For most people, no. Your principal home is exempt in most cases, including up to two hectares of land, though different rules can apply for aged care, a retirement village, or selling before buying again.

How much super can I have and still get a part Age Pension? It depends on whether you own your home and whether you're single or a couple. As at 1 July 2026, a homeowner couple's combined assets can reach around $1,102,500 before the part pension cuts out, though this cut-off moves again each March and September. Services Australia's assets test for Age Pension page always shows the current figure.

Does giving money to my children affect my Age Pension? It can. You can gift up to $10,000 in a financial year and $30,000 over five years before it affects your assessment in most cases. Anything above that is typically treated as a deprived asset and continues to count under both tests for five years from the date of the gift.

What happens to my Age Pension if I downsize? Selling your home and buying a cheaper one can leave you with sale proceeds that become an assessable asset. Proceeds you plan to use on a new home can usually stay exempt from the test for up to 24 months, sometimes longer, while you arrange the purchase.

Does the assets test or the income test decide my Age Pension? Centrelink applies both and pays whichever result is lower, so a strategy that helps your position under one test doesn't automatically help under the other.

Figures referenced in this article are current as at the date of publication and may be subject to change.

This article contains general information only and does not take into account your personal financial situation, needs or objectives. Before acting on any information, consider whether it is appropriate for you and seek professional advice.