Financial Care Services Newsletter

by Christine Hopper
Volume 13 Edition 2 – 28 February 2023

Christine at Financial Care Services, the specialist adviser to seniors in transition to new lifestyles

Planning your overseas travel without negative consequences at Centrelink

Australian seniors like to travel.

Now that the borders have reopened after covid, you might be planning that overdue visit to your extended family.

Recent retirees now freed from work commitments, might be ready for that overseas adventure.

But before you confirm your travel plans, you might think about the Centrelink implications of your absence from Australia.

When you are still accruing ‘your qualifying period of permanent residency’ for a Centrelink Pension

Centrelink Pensions are for citizens and permanent residents of Australia who have lived here long term.

Before you could claim an Age Pension or Disability Support Pension, you must prove to Centrelink that you have lived in Australia as a citizen or ‘permanent resident’ for at least ten years.

Your ten years must include a continuous period of at least five years as a ‘permanent resident’ or citizen.

Most of us stayed quietly at home for the covid season.

Thinking back your might have stayed here for nearly four years since your last trip overseas.

If you have not already completed the continuous five years part of your ten year residency requirement then you might consider deferring your next overseas visit until the five year anniversary of your last return to Australia.

You can start planning immediately but maybe defer your departure.

Centrelink Health Cards and some Carer benefits have shorter ‘permanent residency qualifying periods’.

The Commonwealth Seniors Health Card has a qualification period of four years as a citizen or ‘permanent resident’.

Therefore even if you are too young and robust to be thinking about Centrelink Pensions, you could check your accrued permanent residency period against the Health Card rules before you book your travel.

When a Centrelink Pensioner goes travelling abroad

But before you confirm your travel plans you might think about the Centrelink Pension implications of your absence from Australia.

Most Age Pensioners can take a holiday of not more than six weeks, without losing any Age Pension.

But if you have not yet satisfied the residency requirements for a Centrelink benefit then you might want to reconsider the timing of your travel.

Just one month outside of Australia causes serious problems for three groups of Centrelink Pensioners.

Seniors who returned to Australia and applied for a Pension soon after resettling here

Firstly, your Centrelink Pension will be cancelled if you were not living in Australia for two full years across the period that you applied for and started receiving that Pension.

This means that if you applied for an Age Pension immediately you arrived back in Australia after working abroad for, say, five years, then Centrelink would cancel your Age Pension if you exited Australia within the next two years.

Australian resident Pensioners with partners living in another country.

The second group of Centrelink Pensioners to be impacted severely by leaving Australia, are Pensioners who lived as a single person in Australia but live with a partner whilst overseas.

An Australian resident could be single at Centrelink, that is, not living with a domestic partner.
Whilst living alone in Australia, the Pension rate would be assessed under the ‘single’ person’s means tests using only the Pensioner’s assets and income.

But when the Pensioner moves in with another person then Centrelink could assess the Pensioner as a member of a couple under the means tests for a couple using the total assets and total income of both members of the couple.

So when a ‘single in Australia’ Pensioner goes overseas and moves in with another adult then Centrelink could treat the Pensioner as ‘a member of a couple’.

The result could be that on visiting an overseas based partner, Centrelink could immediately reduce the Pension payment rate to the partnered rate.
If the overseas based partner has significant assets and/or income then Centrelink could further reduce the Pension payment rate under the Asset Test or Income Test.

Do not think that Centrelink would never find out about your overseas based domestic partner.
Social media is just one more source of feedback to Centrelink.

Disability Support Pensioners are only allowed four weeks away in any year.

The third group of Centrelink Pensioners to be impacted severely, are Disability Support Pensioners who are absent from Australia for more than twenty eight days in any rolling twelve month period.
Yes, that is just four weeks as recorded in the great Commonwealth computer system.

Disability Support Pensioners may split their 28 day allowance into shorter trips.
But you need to keep careful records to ensure that you are not away for 29 days in any year as counted by the Commonwealth.

The Disability Support Pensioners who have satisfied Centrelink that they are permanently blind and/or totally incapable of ever becoming workers, can have their Disability Support Pensions adjusted after leaving Australia in the same way as Age Pensioners.

Extensions to the 28 day allowance can be granted for some study courses and para sports competitions.

But if there is any possibility that you might be able to work at all at any time in the future then your Disability Support Pension will be cancelled immediately you have been out of Australia for twenty nine days in the in the last twelve months.

Cancellation of your Disability Support Pension means losing your Pension Concession Card.
Then you would not get any Pensioner discounts on utility bills if you were without a valid Pension Concession Card on the relevant billing date.

On returning to Australia after exceeding your 28 day absence allowance, Centrelink might not reinstate your Disability Support Pension.

Once your Disability Support Pension has been cancelled for any reason, you would need to reapply and satisfy the current standards for incapacity for working.
Beware, the ‘work capacity’ assessment standards have changed in the last decade.
Not all current Disability Support Pensioners would remain eligible if they were assessed against the 2023 ‘work capacity’ test.

Age Pensioners abroad for a continuous period of six weeks

Once you have been away from Australia for six weeks, your Age Pension payment rate will reduce.

At the end of a six week absence from Australia, your Pension Supplement would drop to the “basic” rate.
As at February 2023, the fortnightly basic rate of Pension Supplement is $26.20 for a single Pensioner and $21.60 for a Pensioner who has a partner.

The Clean Energy Supplement stops once you have been out of Australia for six weeks.
In February 2023, the Clean Energy Supplement is paid at the rate of $14.10 per fortnight for a single Pensioner and $10.60 per fortnight for each eligible Pensioner member of a couple.

The impact of staying overseas for longer than six weeks would be a reduction in your Pension Supplement payment of $63.05 per fortnight in February 2023 if you are a single Age Pensioner.
The reduction in Pension Supplements would be $46.00 per fortnight for each Pensioner member of a couple.

Departed permanently once you are away from Australia for 26 weeks

The next critical timing point is when you have been away from Australia for six months or you are earlier known to have departed ‘permanently’. Six months absence from Australia is sufficient for Centrelink to deem you to have departed permanently.

Your Age Pension payment can be reduced significantly if you have permanently departed Australia but you had not lived in Australia for 35 years of ‘working lifetime’.
Working lifetime starts not earlier than your sixteenth birthday and ends no later than when you attain your Age Pension Age.

Your Claim for an Age Pension includes a Question about when and where you have lived for your whole life.
So Centrelink could easily check if your Age Pension Claim disclosed periods when you lived outside of Australia.

If your Age Pension Claim did not have you living your entire life in Australia then Centrelink require ‘proof’ of the periods that you were living in Australia during your ‘working lifetime’.
You could show Income Tax Assessment Notices, employment termination statements, educational certificates covering parts of your ‘working lifetime’.
You might show your Marriage Certificate and your children’s Birth Certificates to demonstrate that you were here with your family.

But moving to a country that has a current Social Security Agreement with Australia might allow you to keep your full Age Pension.

Social Security Agreements change over time.
Some Social Security Agreements such as that with the United Kingdom, are now closed to new cases.

Before you confirm your travel plans be sure to check the Centrelink impact of your overseas adventures.

Help to understand how your situation fits the absent Pensioner system

Age Pensioners who are thinking about moving overseas need to check out their situation and all of the special rules at Centrelink.

Christine at Financial Care Services can help you to understand your Centrelink Pension situation.
Ask Christine to help you navigate your Age Pension challenge before you pay for your overseas travel.

Absentee Commonwealth Seniors Health Card holders are different from absentee Age Pensioners

Your Commonwealth Seniors Health Card usually continues to remain valid while you are away overseas.

But you might not have any opportunities to claim a benefit from your Commonwealth Seniors Health Card whilst away from Australia.
The main advantage of holding a Commonwealth Seniors Health Card is access to PBS prescription medications at Pensioner Concession prices.
You need to visit a pharmacy within Australia to access these PBS prescription price concessions.

Commonwealth Seniors Health Card holders are usually bulk billed for essential radiology services under Medicare.
Medicare funded services are only available within Australia so you would not be claiming these while you are away overseas.

Therefore the Commonwealth does not rush to cancel your Commonwealth Seniors Health Card if you are away from Australia short term.

However, your Commonwealth Seniors Health Card could be cancelled and/or a new Card not issued to you next September, if Centrelink are not satisfied that you are an Australian resident and your ‘adjusted taxable income’ continues to be under the limit.

For example, a substantial capital gain from selling that beach house, could increase your ‘adjusted taxable income’ enough to have your Card cancelled until you inform Centrelink of a lower ‘adjusted taxable income’ for a later year.
Being away from Australia when Centrelink receive your latest Income Tax return data could delay your reinstatement actions.

Help to understand how your situation fits in the Commonwealth Seniors Health Card rules.

Seniors who are thinking about moving overseas need to check out their situation and all of the special rules at Centrelink.

Christine at Financial Care Services can help you to understand your Centrelink Commonwealth Seniors Health Card situation.
Ask Christine to help you review your Commonwealth Seniors Health Card position before you pay for your overseas travel.

Christine at Financial Care Services your independent adviser

Christine at Financial Care Services is an independent adviser specialising in retirees of modest means and aged care entrants.
Our core values include working with clients in claiming DVA and Centrelink entitlements.

Christine at Financial Care Services is here to answer your Health Card and Age Pension questions and guide your understanding of aged care costs.

Help with Centrelink challenges is available from Christine Hopper at Financial Care Services, the specialist adviser to seniors in transition to new lifestyles.

Christine has neat handwriting just right for inserting your data into small printed spaces.
She helps clients complete Centrelink forms.
Christine could help you with collating your supporting documents and then mailing your form to Centrelink.

Assistance with completing Age Pension, Low Income Health Card and Commonwealth Seniors Health Card Claims and the Commonwealth aged care means testing forms is available to clients of Christine at Financial Care Services.

Christine charges fees based on the work involved in advising you about health cards, pensions and aged care fee solutions.

To make an appointment for confidential, independent and professional advice about aged care, retirement lifestyle costs, granny flat or Age Pension issues please contact Christine Hopper or call +61 3 9808 0338.
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Christine Hopper
Financial Care Services
Independent aged care, strategic lifestyle and Social Security advice for seniors in Melbourne, Victoria, Australia
Telephone – call +61 3 9808 0338
Email – contact Christine@financialcareservices.com.au
Address – mail to 2B Thomas Street, Camberwell Victoria 3124
Website – visit financialcareservices.com.au
LinkedIn – connect https://www.linkedin.com/in/christinehopper1
Past newsletters – see http://financialcareservices.com.au/newsletters/
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Disclaimer: The information contained in this newsletter is of a general nature only and does not constitute “financial advice”.
All eligibility for Commonwealth benefits will be determined by Centrelink or DVA, based on your personal position as documented and the legislation and Regulations in force at that time.