Boosted Work Bonus Unlocks Extra Income for Older Australians

By Jeff Gibbs

Older Australians seeking to work without impacting their pension are greeted with positive news as the new year brings a signifcant enhancement to pension working rules.

Effective January 1, the Work Bonus receives a substantial increase of $4,000, establishing a permanent annual limit of $11,800. This adjustment, resulting from ongoing pension working rule reforms, allows working pensioners to gain an additional $2,000, eliminating barriers for those eager to work in later life.

Understanding the mechanics of the enhanced Work Bonus is crucial. Thankfully, there’s no need for a separate application; individuals only need to declare their income, and the myGov/Centrelink portal provides convenient online access to the Work Bonus balance.

Key Points of the

Enhanced Work Bonus:

• Under existing rules, the frst $300 of fortnightly work income is pension income testexempt, with the unused portion accumulating in a Work Bonus income bank.

• The $4,000 permanent increase is added to the $7,800 annual limit, enhancing fexibility for individuals who work intensely in shorter periods. The extra $4,000 is applied at the start of the year.

• As of January 1, 2024, the permanent increase allows individuals to earn $453 per fortnight without impacting their pension, potentially enabling them to take on extra shifts.

• The Work Bonus operates alongside the pension income free area, enabling eligible pensioners to earn up to $657 per fortnight.

Illustrative Examples:

Single Pensioners:

1. John: An age pensioner working as a school crossing supervisor earning $400 a fortnight. Only $100 is counted under the pension income test, ensuring John receives the maximum Age

Pension rate.

2. Julie: An age pensioner working as an accountant for three fortnights, earning $6,000. With her Work Bonus income bank higher than her income, none of the $6,000 is assessed under the income test, allowing Julie to retain $6,700 for future earnings.

Couples:

• Carol and Rob: A couple receiving the Age Pension. Carol’s work income of $700 and Rob’s self-employment income of $220 result in a combined assessed income of $400 a fortnight, leading to a $20 reduction in their combined pensions.

In conclusion, the enhanced Work Bonus provides a signifcant income-boosting opportunity for older Australians while maintaining pension eligibility. For more information, individuals can contact Services Australia through Centrelink offces, phone (13 23 00), or online at Services Australia.