Australia’s Work Bonus scheme offers pensioners an opportunity to increase their income without impacting their Centrelink payments.
Those claiming the Age Pension, Disability Support Pension, or Carer Payment can receive a one-off boost of $4,000 through this initiative, allowing them to earn more while still receiving their pension payments.
If you’re over 67 and eligible, you can start earning without waiting and benefit from the extra funds.
What is the Work Bonus?
The Work Bonus allows Australians on eligible pensions to earn additional income from paid employment without reducing their Centrelink payments. Every fortnight, you can earn $300 without any effect on your pension.
If your earnings exceed $300, the extra amount is deducted from your Work Bonus balance, ensuring that your pension remains unaffected until the balance is depleted.
How Does the Work Bonus Work?
Under this scheme, pensioners don’t need to apply for the Work Bonus; they simply need to inform Centrelink about any income from employment.
The bonus works by exempting up to $300 of fortnightly income from being counted towards your pension income test.
Here’s how it works:
- If you earn less than $300 in a fortnight, the difference is added to your Work Bonus balance, which accumulates up to a maximum of $11,800.
- If you’re a new claimant, you begin with a Work Bonus balance of $4,000, which means you can earn up to this amount before any changes occur to your pension.
- For instance, if you earn $750 in a fortnight, $300 will be automatically deducted from your Work Bonus, and the remaining $450 will be subtracted from your balance. The balance will decrease to $7,450, while your pension remains unaffected until the balance reaches $0.
How Much Can You Earn Without Affecting Your Pension?
The Work Bonus is in addition to the pension income test free area. The current limits are:
- Single pensioners can earn up to $212 a fortnight from any source without affecting their pension.
- Couples can earn up to $372 a fortnight.
When combined with the Work Bonus, this allows:
- Singles to earn up to $512 a fortnight.
- Couples to earn up to $672 a fortnight.
Example of How the Work Bonus Works
For someone with a Work Bonus balance of $7,900 who returns to work and earns $750 in the first fortnight:
- $300 will be exempted under the Work Bonus.
- The remaining $450 will be deducted from their Work Bonus balance, reducing it to $7,450.
- Their pension remains unchanged.
If they continue to earn $750 every fortnight, it would take 16 fortnights before their pension is affected.
Key Takeaways
- The Work Bonus allows you to earn additional income without reducing your Age Pension or other eligible pensions.
- You can start working immediately and earn up to $4,000 before it impacts your pension.
- Your Work Bonus balance accumulates up to $11,800.
The Work Bonus is an excellent way for Australians claiming pensions to increase their earnings while still retaining full access to their Age Pension and related benefits.
It provides a significant boost, allowing for greater financial freedom and flexibility in managing retirement or caregiving needs.
FAQs
How does the Work Bonus help pensioners?
The Work Bonus enables pensioners to earn extra income from work without it affecting their pension payments.
Do I need to apply for the Work Bonus?
No, you don’t need to apply. Just inform Centrelink about your work income.
What happens if I earn more than $300 in a fortnight?
Any income over $300 is offset against your Work Bonus balance, and your pension remains unchanged until the balance is depleted.