How the Age Pension works: eligibility, income tests and payment rates 

How are you planning to fund your retirement? For most Australians, the answer isn’t a single stream of income, but a combination of different sources. While superannuation and savings can help fund your lifestyle, the Government Age Pension can provide a baseline or further supplement other incomes.

As at March 2025, the Australian Institute of Health and Welfare reported that 2.7 million Australians of retirement age were receiving the Age Pension. Yet, despite how many people rely on it, there’s still confusion about how it works. So it helps to know the Age Pension isn’t an all-or-nothing system. As your savings grow or change, the Age Pension adjusts with you, which means even if you don’t qualify today, that might change later. 

Many people assume that blowing out the candles on your birthday is the only milestone that counts, but it’s not the only criteria. If you’re wondering about eligibility or how much you could get, it’s helpful to start by understanding what the Age Pension is and how it works.

What is the Age Pension?

The Age Pension is a fortnightly Government payment, managed by Services Australia, and paid through Centrelink or DVA to help cover basic living costs. It provides essential financial support once you scale back or say goodbye to full-time work. It’s not intended to fund a lifestyle beyond very basic needs. 

That said, the Age Pension doesn’t have to be your sole source of retirement funds. For many people, it works alongside personal savings, investments and your super.

To qualify for the Age Pension, you must meet specific criteria, including age rules, residency requirements, and an evaluation of your wealth through financial means and income tests.

Who is eligible for the Age Pension?

To qualify for the Age Pension, you generally need to meet three key requirements: your age, your residency history and the Government's income and assets tests. 

Services Australia assesses your circumstances against three main criteria:

• Age requirements – you must be at least 67 years old

• Residency requirements – you must meet Australian residency rules

• Financial means testing – your income and assets must fall within the applicable thresholds 

Understanding how these three factors work together is the first step to working out whether you may be eligible for Government support in retirement.

What are the Age Pension age requirements?

The earliest you can start getting the Age Pension is age 67.

What are the Age Pension residency requirements? 

To satisfy the Age Pension residency rules, you must be an Australian resident and physically in Australia on the day you apply, with a history of living in Australia for at least 10 years. This decade of residency must include a single, unbroken block of at least five continuous years.

If your residency history is more complex, you can check your status or review structural exemptions directly via the Services Australia residence rules page.

How do the Age Pension income and assets tests work?

The Age Pension income and assets tests assess your financial circumstances to determine how much support you may receive. Because the system adjusts gradually, some retirees become eligible to receive  a higher Age Pension over time as they draw down their savings- so the value of their assets decreases. 

How does the income test work?

The income test assesses money coming into your household from all sources, reducing your fortnightly Age Pension payment by 50 cents for every dollar you earn over the designated threshold. This evaluation covers employment earnings, plus savings, shares and potentially super (more on that below). 

You can earn up to the following fortnightly limits to receive the maximum Age Pension rate (current as of July 2026):

• Single: Up to $226 per fortnight 

• Couple (combined): Up to $396 per fortnight

If your income is above the threshold, your Age Pension payment is gradually reduced. At higher income levels, your payment may reduce to nil. As of July 2026, this generally occurs at around:

• Single: $2,627.80 per fortnight

• Couple (combined): $4,016.80 per fortnight

Remember, you’re never fully locked out of the system, so if your income lowers, you may be eligible for a higher Age Pension. For a deeper dive into specific cut-off points, including couples living apart due to ill health, check out Services Australia’s income test information.

How does the assets test work? 

The assets test evaluates the total market value of the property and possessions you and your partner own- including how much you hold in super. How much you are eligible to receive reduces as the value of your assets exceed certain limits. While investments, cars and super balances count toward this total, your primary family home is generally exempt from assessment.

When your assessable assets exceed the lower thresholds below, your pension rate reduces at a rate of $3 per fortnight for every $1,000 over the limit.

Asset test limits

^{Data accurate as of July 2026. Source:  Services Australia assets test.} 

How much does the Age Pension pay?  

The maximum Age Pension payment is $1,200.90 per fortnight for single individuals and $1,810.40 combined per fortnight for couples. These base amounts include the standard Age Pension and energy supplements, and are indexed twice a year in March and September to keep pace with the cost of living. 

^{Data accurate as of July 2026. Source:  Services Australia pension rates.} 

What happens if I’m not eligible for the Aged Pension? 

If your income and assets sit above the lower limits but below the maximum cut-off points, you’ll automatically qualify for a part Age Pension rather than missing out entirely.  

The means tests are designed to scale Government support as your personal wealth changes, so just because you don’t qualify today doesn’t mean you can’t qualify down the track.  

Keep in mind, even a part-pension payment can still unlock access to the Pensioner Concession Card, which provides helpful discounts on medical costs, utilities and public transport. 

Does my super balance affect my Age Pension? 

The amount you have in super can affect your Age Pension entitlement. 

Before age 67, super held in accumulation phase is generally exempt from Centrelink's income and assets tests for other types of social security benefits. Once you reach age 67, your super is assessed under the assets test, while deemed income from your financial assets is used under the income test to help determine how much Age Pension you may be eligible to receive. 

Can the way you structure your retirement income affect your Age Pension?  

Yes. How you choose to use your super in retirement can affect how much Age Pension you may be eligible to receive.  

Not all retirement income products are assessed in the same way under Centrelink rules. Some retirement income products receive concessional treatment, which can affect how much Age Pension you may be eligible to receive. 

For example, lifetime retirement income streams receive favourable treatment under the Age Pension assets test. This means a lower amount is used when calculating your eligibility, which may increase the amount of Age Pension you receive compared to holding the same money in other retirement income arrangements.  

See how this works in reality here. 

To learn more, read:  

• How retirement income works in Australia – and where it comes from  

• Why most retirees use more than one income source  

• Your quick guide to retirement income options  

What should I do next? 

Building a comfortable retirement involves a few different paths working together. Since the Age Pension is designed to work alongside your super and other retirement income sources, it's worth understanding not only whether you're eligible, but how different retirement income options may affect your overall income. Our Retirement Simulator can help you explore how super, the Age Pension and retirement income streams work together (including lifetime retirement income streams), so you can make more informed decisions about retirement. 

Getting personalised advice can be a great way to get further clarity. AMP Super members have access to Digital Financial Advice for no extra fees. Get a projection of what kind of retirement income you could have and what Age Pension entitlement you could get along with practical steps to improve your position. If you'd prefer to talk things through, AMP's financial advisers can help explain your options and answer your questions.