Deeming Rates 2026: How They Affect Your Age Pension and Concession Cards
Updated: 3 minutes ago
On 20 September 2026, Age Pension payments increased. On the same day, deeming rates increased too. For some retirees the two changes partly offset each other, and for others they do not. Which applies to you depends on the financial assets you hold, which Centrelink test is reducing your payment, and which concession cards you have.
This article explains how deeming works, what changed, and how it can affect your Age Pension, health cards and some aged care fees.
Deeming rates key points:
If the assets test is the one reducing your pension, your payment may not be affected by the deeming increase.
If the income test is the one reducing your pension, higher deemed income may reduce your payment, which may partly offset the pension increase.
For the Commonwealth Seniors Health Card, only account-based income streams are deemed. Income from other investments counts through your adjusted taxable income instead.
What is deeming?
Deeming is the method Services Australia (Centrelink) uses to estimate the income you earn from your financial investments. Rather than tracking the actual interest, dividends or returns your savings generate, Centrelink assumes your financial assets earn a set rate.
Your assessed income is based on that assumed figure, whether your actual returns were higher or lower. Two people with the same balance are assessed in the same way, even if one holds their money in a transaction account paying no interest and the other earns 6% from investments.
What is deemed, and what isn't?
Financial investments that are generally deemed include:
Cash: bank accounts, term deposits and credit union savings
Market investments: shares, managed funds, listed securities and bonds
Superannuation: account-based pensions started on or after 1 January 2015
Gifts above the allowable limits ($10,000 in a financial year, or $30,000 over five financial years) can also be treated as if you still own them (known as deprived assets), and deemed for up to five years.
Some things are treated differently:
Your home. Your principal home is exempt from deeming and from the Age Pension assets test.
Other income. Employment income, rental income and foreign pensions are assessed under their own rules rather than deeming.
Older account-based pensions. Some account-based pensions that started before 1 January 2015 and have been held continuously are assessed under different income rules.
Deeming rates from 20 September 2026
Centrelink uses two deeming rates. The lower rate applies to financial investments up to a threshold, and the higher rate applies to everything above it.
Before 20 September 2026 | From 20 September 2026 | |
Lower deeming rate | 1.25% | 1.75% |
Higher deeming rate | 3.25% | 3.75% |
Threshold (single) | $66,800 | $66,800 |
Threshold (couple, combined) | $110,600 | $110,600 |
The thresholds were indexed on 1 July 2026. The rates changed on 20 September 2026. Different thresholds apply to couples separated by illness, so check the Services Australia deeming page if this applies to you.
Both rates rose by half a percentage point. This means your assessed income increases by $5 a year for every $1,000 of financial investments you hold, whatever your balance. For a single person:
Financial investments | Deemed income before | Deemed income from 20 Sept | Annual increase |
$100,000 | $1,914 | $2,414 | $500 |
$200,000 | $5,164 | $6,164 | $1,000 |
$500,000 | $14,914 | $17,414 | $2,500 |
These figures show how your assessed income changes. They do not show how your pension payment changes, which depends on which test applies to you.
How deeming affects the Age Pension
Centrelink assesses your Age Pension under an income test and an assets test, and pays you whichever gives the lower result. Deeming feeds into the income test.
If the income test is reducing your payment, higher deemed income may reduce it further. The maximum pension rates also increased on 20 September, so this may partly offset the change, depending on your balance.
If the assets test is reducing your payment, the deeming increase may not change your payment, because the assets test looks at the value of your assets rather than deemed income.
Because the result depends on your assets, income, home ownership and living arrangements, the same rate change can leave one retiree slightly worse off and another unaffected. Our article on Age Pension asset test thresholds explains how the two tests work together.
Concession cards and aged care fees
Deeming applies differently across cards and fees, which is where retirees are most often caught out.
Commonwealth Seniors Health Card (CSHC). The CSHC has no assets test. Only account-based income streams are deemed. Income from other investments, such as term deposits and shares, counts through your adjusted taxable income. From 20 September 2026, the limits are $105,048 for a single person and $168,076 for a couple combined. See our article on CSHC eligibility.
Low Income Health Care Card. This card is based on an income test with no assets test, and deemed income can count towards the limit. Check the Services Australia website for how your investments are assessed.
Pensioner Concession Card. This card is linked to receiving a qualifying payment. If a change in your assessed income reduces your Age Pension to nil, your card entitlement may change, and it may be worth checking whether another card, such as the CSHC, applies.
Aged care fees. Deeming is also used when income is assessed for some aged care fees, so a rate change can affect those assessments. How this applies depends on the type of care and your circumstances, so check with My Aged Care or Services Australia.
What to do next
Rate changes are applied automatically, so it is worth checking whether your payment or card entitlement has shifted rather than assuming your last assessment still applies.
Our Centrelink Services team in Bendigo can review how your investments, super and account-based pensions are currently assessed. Read more about help with Centrelink in Bendigo, or contact us to arrange a consultation.
Frequently asked questions about deeming rates
What is deeming?
Deeming is the method Services Australia uses to estimate income from financial investments. It applies a set rate to your balance, regardless of actual returns.
Are bank accounts and term deposits deemed for the Age Pension?
Yes. Bank accounts, term deposits, shares, managed funds and account-based pensions started on or after 1 January 2015 are generally deemed for the Age Pension income test.
Do deeming rates affect the Commonwealth Seniors Health Card?
Only for account-based income streams. For the CSHC, income from other investments is assessed through your adjusted taxable income rather than deeming.
Will my pension reduce because deeming rates increased?
It depends on which test is reducing your payment. If it is the income test, higher deemed income may reduce your payment, though the 20 September pension increase may partly offset this. If it is the assets test, your payment may not change.
How often do deeming rates change?
Deeming rates are set by the Minister for Social Services and can change more than once a year. The thresholds are indexed each 1 July.