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Super and the Age Pension

When retiring, many First Super members use a combination of their super savings together with the Age Pension to give them a regular income during their retirement. It’s important to make the most of any government benefits as well as maximise your super savings.

What is the Age Pension?

You work hard to grow your super throughout your career. However sometimes super savings are not enough to cover everything in retirement. The Government provides the Age Pension to supplement (top-up) income from your super.

The Age Pension is generally paid on a fortnightly basis from Centrelink and, in some cases, can be tax free.

There are certain eligibility conditions that must be met to receive Age Pension payments, not everyone is automatically entitled to receive them.

What is a Retirement income account?

A Retirement Income account provides you with a regular, tax-free payments.

Set up with money transferred from your super, it provides you with regular, flexible income payments in retirement.

The First Super Retirement Income account can be used together with the Government’s Age Pension (if eligible) to fund your retirement.

Age Pension amounts

Depending on your circumstances, you may be eligible for the full Age Pension or a part Age Pension.

The following table outlines the fortnightly amounts of a full Age Pension (maximum basic rate).

Per fortnight Single Couple (each) Couple combined Couple apart due to ill health (each)
Maximum basic rate $1,020.60 $769.30 $1,538.60 $1,020.60
Maximum Pension Supplement $81.60 $61.50 $123.00 $81.60
Energy Supplement $14.10 $10.60 $21.20 $14.10
Total $1,116.30 $841.40 $1,682.80 $1,116.30

Do I qualify for the Age Pension?

There are a number of criteria you need to meet to be eligible for the Age Pension. Your age, income from investments, assets you own, and the amount of super you have, all determine whether you may be eligible. Here are the basics of Age Pension eligibility…

1. Age Pension age

You need to be a certain age to qualify for the Age Pension.

If your birth date is You’ll be old enough at
1 July 1952 to 31 December 1953 65 years and 6 months
1 January 1954 to 30 June 1955 66 years
1 July 1955 to 31 December 1956 66 years and 6 months
From 1 January 1957 67 years

2. Australian residency

You must be an Australian resident (for at least 10 years), be living in and physically present in Australia on the day you claim the Age Pension.

3. Asset and Income test

Finally, you must meet the requirements of an Assets test and an Income test. This is where it starts to get complex, so speaking with a First Super Financial Planner could really benefit you. Check out the videos we’ve prepared which outline these tests in more detail.

Income and Asset tests videos

Super and Age Pension working together

Generally, you can earn up to $204 per fortnight ($360 for a couple) from super, shares, investments etc. without reducing the Age Pension amount.

Any income over this amount would reduce your Age Pension payment until your eligibility disappears if you are earning $2,436 or more per fortnight ($3,725 for a couple). Don’t forget, you also need to meet the requirements of the Asset test.

The Assets test includes:

  • money in your bank account
  • superannuation
  • investment in shares or term deposits
  • investment property

There are different amounts of assets you can have, depending on whether you are a couple or a home-owner, before it affects your eligibility to receive the Age Pension.

I need help

A Retirement Health Check is a great way of determining whether you may be eligible for the Age Pension, and how this could work with your super. We can even include your partner regardless of which super fund they belong to.

It doesn’t cost anything extra, (it’s already included in your membership) and could significantly change the way you spend your retirement.

It’s a 30–45-minute consultation with a qualified financial planner. It’s been developed exclusively for First Super members and should be the first step in planning your retirement.

Tax on the Age Pension

There is no tax payable on withdrawals you make from super, whether it is regular retirement income payments or lump sums, provided you are aged 60 or over. However, what about Age Pension payments?

Age Pension payments are generally tax free, provided they are your only source of income.

If you do receive other sources of income such as share dividends, rental income or other investment income, then these will be combined with your Age Pension payments for income tax purposes, and declared on your tax return each financial year.

If you are earning income from the Age Pension and other sources, then the standard Australian tax-free threshold and tax brackets will apply to you; meaning the tax you pay will depend on how much you earn.

Tax is not automatically deducted from the fortnightly Age Pension payments, so you may need to pay tax at the end of the financial year. You can request that Centrelink deducts tax from your Age Pension payments helping you to reduce how much tax you owe at the end of each financial year.

Australian tax brackets applicable to Age-pensioners and non-pensioners in 2024/25:

Taxable income Tax on this income
0 – $18,200 Nil
$18,201 – $45,000 16c for each $1 over $18,200
$45,001 – $135,000 $4,288 plus 30c for each $1 over $45,000
$135,001 – $190,000 $31,288 plus 37c for each $1 over $135,000
$190,001 and over $51,638 plus 45c for each $1 over $190,000

The above rates do not include the Medicare levy of 2%.

If you do receive Age Pension payments, then you’ll also receive health benefits as well as discounts on council rates, public transport, gas, electricity, telephone and car registration.

Combining super and the Age Pension

Many First Super members choose to transfer their super to a First Super Retirement Income account when they retire. This allows them to continue earning tax-free investment returns through their chosen investment option, while drawing down their balance through regular retirement income payments.

Many members also receive either full or part Age Pension payments at the same time, it’s a way to top-up their super income to cover basic living expenses in retirement.

Super and Age Pension case study

  • Steve is 67 and looking to retire. He and his partner Julie have assets worth $407,000 so they meet the Age Pension Assets test requirements for couples.
  • Julie is still working part-time earning $850 a fortnight, which means that under the couple’s Income test, Steve won’t be eligible for the full Age Pension, but could receive a fortnightly part Age Pension payment.
  • The part Age Pension payments together with Julie’s income would not be enough to meet their current living expenses.
  • Steve decides to double check his options with a financial planner to see if he can retire.
  • After receiving financial advice, Julie starts to make additional after-tax contributions to her super to entitle her for the super co-contribution from the Government. This will boost her super before she retires.
  • Steve can go ahead with his retirement plans, by starting a Retirement Income account which provides a regular tax-free income to top up the Age Pension payments and meet their current living expenses.
  • This strategy allows them to maximise Steve’s eligibility for the Age Pension, boost Julie’s super balance and continue enjoying their lifestyle before Julie retires too.

Applying for the Age Pension

Applications for the Age Pension are best done online, through Centrelink. You will need to set up a Centrelink account and link this to your myGov account.

You will need to provide a number of documents to support your claim, including:

  • Your age
  • Bank account details
  • Tax file number
  • Australian residency status
  • Relationship status
  • Proof of income and assets, including superannuation

For more information about applying for the Age pension visit the Services Australia website.

Reduce your work hours and
boost your super

A Transition to Retirement (TTR) strategy offers many benefits before you retire. It can help you boost your super, or even wind down your work hours and maintain your income.

More on Transition to Retirement

Fancy a regular income
in retirement?

A First Super Retirement Income Account gives you the freedom to choose how your money is invested, as well as how often and how much you get paid in retirement.

More on Retirement Income


The financial situation of every First Super member is different. This is why it’s important to get good advice when planning your retirement.

To find out if you’re eligible for the Age Pension and how it could work together with your super savings, call us on 1300 360 988, or request an online appointment with one of our Financial planners.