PENSION LOAN SCHEME
Under the current rules, pensioners can top up their age pension to the maximum rate if they:
- receive a part pension under the income or assets test, or don’t
receive an age pension under either the income or assets test (but not both).
This allows pensioners to take advantage of a voluntary reverse mortgage scheme, under which Centrelink treats the top-up payments as a loan that is secured by the pensioner’s property. This loan must be repaid when the pensioner either sells the property or passes away.
From 1 July 2019, the government proposes to expand the scheme by making all age pensioners eligible and increasing the maximum top-up payments from 100% to 150% of the maximum age pension rate.
WHAT THIS MEANS FOR YOU ?
If you’re receiving the maximum age pension, you could be eligible for annual top-up pension payments of up to $11,799 for singles or $17,877 for couples. However, some restrictions may apply, depending on factors such as:
whether you are single or a member of a couple
the value of your home
the expected duration of these top-up payments.