How Do I get a Pension in Australia?
Australian superannuation is funded by employers. Employers must pay a minimum of 9 percent of every employee's 'ordinary time earnings' into a compulsory retirement fund. The fund must be registered with and approved by the Australian Government.Some employers pay your salary and, separately, make an additional payment into the fund. Others will deduct the payment from your "remuneration package". When you compare packages from different employers you need to be clear which approach is being followed.
For most people, superannuation supplements the Government's age pension and provides them with additional income in retirement.
From 2007, superannuation benefits paid from a taxed fund will be tax-free for people aged 60 and over.
Pension payments from the government are currently worth $13,980 per annum for single people, and $23,353 per annum for couples.
Various other allowances may be available for the aged, such as utilities allowances.
To qualify for an age pension in Australia, you usually need to have lived as a resident or citizen in Australia for at least 10 years.
Australian pensions are income and asset tested.
Asset Test
If, in addition to their home, a single person has assets worth less than $157,000 (couple $223,000) they will get the full government pension.
A sliding scale operates after this - from 2007 a person will lose $1.50 of age pension per fortnight ($39 annually) for every $1,000 of assets above the figure of $157,000 (couple $223,000).
Income Test
If a single person's income (not including government age pension) is less than $124 per fortnight ($220 couples) they will qualify for the full age pension.
Income above these amounts reduces the pension payable by 40 cents in the dollar (single) or 20 cents in the dollar each (for couples).