Age Pension Indexation Estimator
This tool estimates the possible impact on the Age Pension from pension indexation and changes to deeming rates on 20 March 2026.
The Federal Government adjusts Age Pension payments twice a year (20 March and September) to account for changes in living costs. This is called indexation.
Centrelink also uses deeming rates to estimate your income as part of the Age Pension Income Test and these rates will be reviewed at the same time as indexation.
This estimator allows you to see how much your pension may change based on indexation and changes to deeming rates. You can see how much a deeming rate increase might affect your pension by selecting different scenarios after entering basic details.
The estimator is a guide only and is not able to show your specific circumstance. Centrelink will notify you of your exact pension entitlement after 20 March.
While indexation and deeming rates rise and fall in line with inflation and other factors, deeming rates were frozen by government for three years unitl 1 July 2025.
National Seniors Australia is calling for any change to deeming rates to be made slowly, to avoid punishing pensioners facing high living costs.
You can join our campaign for slow and fair changes to deeming rates below.
Age Pension Indexation Estimator:
The above are general estimates of the potential impact based on the information available and assumptions made and is not intended as educational material and not legal advice, financial advice, or other forms of professional advice. The impact will vary depending on the full financial circumstances of specific individuals or couples. We discuss our assumptions further below.
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These are the assumptions used to produce these estimates:
- Includes a preliminary estimate of likely pension indexation on 20 March 2026 based on published ABS CPI and PBLCI data, but not subsequent MTAWE data.
- Alternative deeming rate settings are possible options and may not reflect the actual changes to deeming rates.
- Assumes no revaluations of assets.
- Previous pension and deeming rates are as announced for 20 September 2025, other thresholds and rates are as in place as at 1 July 2025.
- All the of the income free area ($218 for singles, $380 for couples) is available to apply against deemed income and other income. No employment income is earned.
- Excludes any payments received in relation to renting, such as Commonwealth Rental Assistance.
- Assumes ownership of non-deemed other assets (such as real estate, primary production assets and foreign assets) in approximately the same proportion as those in the DSS Quarterly Benefit and Payment Recipient Demographic statistics, accounting for single/couple and homeowner/non-homeowner status and by asset range. Assumes a return of 5% on these non-deemed assets.
Q: Why are only some financial asset values shown
A: We have selected the financial asset ranges most likely to be impacted by a change to the deeming rates. People with financial assets below this level are more likely to retain the full-rate pension; people above these levels are not likely affected because they are impacted by the Assets Test. As these are general estimates and not based on individual circumstances, we have calculated the amounts in $50,000 increments.
Q: Why don't these estimates reflect what I'm receiving?
A: These estimates are intended as broad figures showing the potential of a change to deeming rates and are based on a number of assumptions.
For the Age Pension income test, it is not the actual income you earn from financial assets which matters, but the income you are estimated to have earned through a process called deeming.
Deeming only applies to financial assets, not all assets. Financial assets include things like superannuation (under certain circumstances), savings accounts, term deposits, some income streams or listed shares. More information can be found on the Services Australia website.
This process is intended to keep payments from frequently changing and provide an incentive to invest in higher yielding assets.
Weren’t deeming rates frozen?
Deeming rates were frozen for several years, until 30 June 2025. The government announced the first increase in the deeming rates following the freeze would occur on 20 September 2025, with both rates increasing by 0.50%.
At the same time, the government announced a new process for setting deeming rates. The government now receives advice from the Australian Government Actuary about the level of deeming rates, based on “investment returns reasonably available” to those without specialised financial knowledge, with readily available investment products and without disproportionate investment risks.
However, the decision of where to set deeming rates remains with the government.
The government will announce the deeming rates, and detail the advice, at least one month before the change takes effect: so by 20 February for the 20 March indexation and 20 August for the 20 September indexation.
The first time this occurs will be by 20 February 2026.
Why are deeming rates important?
Deeming rates impact the amount of pension received under the Age Pension Income Test. This doesn't only impact part-pensioners, but it can also impact those receiving a full-rate Age Pension. Some people who currently hold a Commonwealth Seniors Health Card (CSHC) may lose this card if deeming rates increase. The higher the increase in the deeming rates, the more people who could be shifted onto a part-rate Age Pension, the more full and part-rate Age Pensioners will lose in fortnightly income and the higher number of people that will lose the CSHC.
Additionally, with the new Support at Home in-home aged care system, eligibility for the full pension, part-rate pension, or CSHC, is used to determine how much people pay in co-contributions.
