Age Pension after leaving Australia
The Age Pension is for Australian seniors who have reached retirement age and are deemed to be in constrained financial circumstances.
The full rate of Age Pension is only payable to long-term, permanent Australian residents who have little other income and no assets to sell.
Seniors who leave Australia can find that Centrelink reduces or cancels their Age Pension payments.
Long term permanent residents on short absences from Australia
Long term Australian residents continue to be paid their Age Pensions and their Pension Supplements for a maximum of six weeks after leaving Australia.
Thus most Age Pensioners can take a holiday of not more than six weeks without losing any Age Pension.
But seniors who returned to Australia and started an Age Pension must stay in Australia for two years before travelling again or face cancellation of their Age Pensions.
Centrelink will know the date that you departed Australia. Your Passport will be scanned into the great Commonwealth computer system when you pass the Immigration control point at an airport or passenger sea port. Your departure will then be flagged to Centrelink.
The great computer system might not be so quick to inform Centrelink that you are back in Australia. Hence you might need to visit a Centrelink office to confirm that you are back and check that your Age Pension is reinstated fully.
Long term permanent residents absent from Australia for six weeks
Once a long term Australian resident has been away for six weeks, the Pension Supplement will be reduced.
The Clean Energy Supplement part stops once you have been out of Australia for six weeks. But the main, or basic, Pension Supplement continues to be paid with your regular Age Pension payment.
In dollar terms for a single Age Pensioner at January 2019, the Clean Energy Supplement of $14.10 per fortnight ceases once you are away for six weeks. But the basic Pension Supplement of $67.80 per fortnight for a single Age Pensioner continues to be paid.
Your Pensioner Concession Card stays valid while you have your short holiday overseas.
Therefore you would not lose your Pensioner Concessions on Council Rates or utility bills that are payable during your overseas holiday.
Long term permanent residents absent from Australia for six months
The next timing point for permanent Australian residents is at six months after departing Australia. Once you have been out of Australia for twenty six weeks then you are considered to have departed ‘permanently’.
Australian taxpayers are reluctant to finance seniors who choose to live permanently in other countries or travel the world long term.
Your Age Pension payment rate could be cut significantly once you have been away for twenty six weeks. The extent of any reduction in your Age Pension payment depends on how much of your ‘working life’ you actually lived in Australia as a permanent resident.
The same reduction apply to Age Pensioners who inform Centrelink that they are moving to live permanently in another country.
Moving permanently overseas after a full working life of 35 years in Australia
Seniors who lived in Australia as permanent residents for at least 35 years between reaching age sixteen years and their Age Pension Age are not impacted by the living outside of Australia rule.
You must have lived in Australia for 35 years after attaining age sixteen but before attaining your Age Pension Age to avoid a reduction in Age Pension if you live overseas later.
You only had to live in Australia for that period of your working life. There is no requirement that you were active in the workforce.
You could have delayed your entry into full time work on account of your studies. When the current generations of retirees were raising their families, mothers were encouraged to focus on home making and carer roles rather than workforce participation. Thus some Age Pensioners might have had only ten years in the paid workforce after attaining age sixteen years.
Moving permanently overseas after a limited working life in Australia of less than 35 years
Australian citizens who spent many years living and working in other countries might be tempted to retire outside of Australia. The Australian taxpayers are not willing to fully support seniors who did not contribute substantially to Australia during their most productive years.
Hence if you had less than 35 years of your working life in Australia then your Age Pension payment could be reduced if you choose to retire to another country. Your Age Pension payment rate will be reduced pro rata based on your actual working age period in Australia compared with 35 years.
Consider Sam who left Australia as a young adult to see the world. After twenty one years of living and working in Europe, Sam returned to Australia to settle down.
Sam was born in Australia in 1950 and thus has an Age Pension Age of 65 years. Sam was away for twenty one (21) years but still had 28 years of working life in Australia.
As Sam only had 28 years of working life in Australia, Centrelink could cut Sam’s Age Pension by 20% once Sam is away from Australia ‘permanently’.
Sam qualifies for 28/35, that is, 80% of the Age Pension payable within Australia to someone with the same financial resources.
Age Pensioners permanently living outside of Australia on 1 July 2914
Special Age Pension rules apply to Age Pensioners who were permanently living outside of Australia on 1 July 2014.
Prior to July 2014, only twenty five years, 25 years, of permanent Australian residency was required to avoid the Age Pension reduction for not contributing to Australia.
Age Pensioners who were established as permanently overseas on 1 July 2014, retain a payment rate reduction based on 25 years, not the current 35 years of living in Australia during their notional working lives.
Special rules for retirees who have lived and/or retired to countries with Social Security agreements.
Australia has many Social Security Agreements with other countries. These Social Security Agreements usually allow former Australian permanent residents living as retirees in those countries, to apply for an Australian Age Pension and possibly count periods of residence in that country towards the ‘permanent residency’ period for Centrelink benefits.
These Social Security Agreements can be discontinued at any time. Age Pensioners who are thinking about moving overseas permanently need to check out their situation and all of the special rules at Centrelink. Be aware that you might not be eligible for the same mutual recognition provisions as your cousin who retired to that same county five years ago. Your cousin could be covered by an old now cancelled, Social Security Agreement that will not apply to new applicants.
Change of Personal Circumstances during permanent absence from Australia
Your obligation to inform Centrelink of any changes in your personal circumstances does not cease while you are living in another country. If your asset or income position changes significantly you still need to inform Centrelink so that you are paid the correct amount of Age Pension.
You should also inform Centrelink if you become a member of a couple whilst receiving Australian Social Security benefits even if you are away from Australia.
In summary, Age Pensioners can take a holiday or even an extended world tour, and not seriously impact their payments. But if you are out of Australia for more than twenty six weeks then your Age Pension payments could be reduced. Centrelink could stop your Age Pension payments if you are not recorded as being back in Australia after six months from your departure date as recorded in the great big government computer.
Age Pension conditions less restrictive than Disability Support Pension rules when away from Australia
In summary, Age Pensioners can take a holiday or even an extended world tour, and not seriously impact their payments. But if you are out of Australia for more than twenty six weeks then your Age Pension payments could be reduced.
In contrast, Disability Support Pensioners are limited to only twenty eight days, four weeks, of absence from Australia in any twelve month period. Your Disability Support Pension will stop immediately you have been outside of Australia for twenty eight days in the last twelve months.
Your Disability Support Pension can only continue to be paid beyond the 28 days if before you departed Australia you satisfied Centrelink that your disability is so severe and permanent that you will never be able to work in future. If a Disability Support Pension is continued beyond the 28 days then the payment rate would be reduced as for an absent Age Pensioner.
Help to understand how your situation fits in the Age Pension 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 writes this Age Pension Guide. She can help you to understand your Age Pension situation.
Ask Christine to help you navigate your Age Pension challenge.
Contact Christine at Christine@financialcareservices.com.au or call 03 9808 0338 to book a consultation.
Christine at Financial Care Services is experienced with Pension Applications and the many Centrelink financial means tests.
Financial Care Services helps seniors with Centrelink Pension issues. Christine at Financial Care Services could help you check if you are eligible for an Age Pension.
An estimate of your potential Age Pension amount before you apply could spare you a rejection letter from Centrelink.
Financial Care Services offers ‘personal financial factual information’ consultations to help you check your asset and income position against the Centrelink Pension means tests. Christine is also able to assist with filling in your Centrelink forms ready for you to sign. She will accompany you to a Centrelink office to lodge your Pension claim form and show your proof of identity documents.
Financial Care Services charges hourly rate fees for ‘personal financial factual information’ consultations, assistance with personal data collation, completing Centrelink forms and attendance at a Centrelink office with you. Email Christine@financialcareservices.com.au now for the Financial Care Services Client Services Guide and Financial Care Services Age Pension Personal Data Checklist.
Disclaimer This Age Pension Guide is based on our understanding of the current Social Security provisions. Your claim for a Social Security Pension will be based on your personal situation as documented to Centrelink and the Social Security legislation and Regulations in force at that date.
Updated February 2019
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