Age Pension, Centrelink payments & deeming rates to rise next month
20 Aug 2026
More than five million Australians will get a budget boost next month as rates for the Age Pension and other Centrelink payments are lifted.
However, higher deeming rates could offset some or all of the benefit for some pensioners.
Federal Minister for Social Services, Tanya Plibersek, revealed the latest round of payment indexation, which occurs twice a year in March and September, on Thursday, saying the changes will offer cost-of-living relief.
More than 5.3 million Australians will be impacted by the changes, which are expected to cost the government an additional $4 billion.
“Whether it’s paying the rent, putting food on the table, or covering everyday bills, this extra support will help Australians on income support make ends meet,” Ms Plibersek said.
Which Centrelink payments are increasing on September 20?
For people receiving the Age Pension, Disability Support Pension, or Carer Payment, the top rate available will rise by up to $55.60 a fortnight.
For singles, the new maximum payment is lifting to $1,237.70 per fortnight (a $36.80 boost), while for couples, it’s increasing to $1,866 a fortnight ($55.60 more than it currently stands).
Those receiving the Parenting Payment will also see their maximum rate available climb.
The top rate for singles will lift $20.90 per fortnight, reaching $1,087.20, while that for couples will jump by $14.80 to $763 per fortnight.
People receiving Commonwealth Rent Assistance could also see their payments increase by between $2.93 and $4.20 a fortnight, and rent thresholds will also be lifted.
Other payments seeing a boost include JobSeeker, Youth Allowance, and ABSTUDY.
What are deeming rates?
Deeming rates are a crucial part of how individuals are assessed for the Age Pension.
Beyond your actual income, Services Australia will also look at whether you hold any assets when considering if you’re eligible for the Age Pension and how much you might receive each fortnight. If you own certain assets, you’re ‘deemed’ to have earned an amount of income from these, regardless of how much they actually provided you in income or returns.
Deeming rates apply to assets like savings accounts and term deposits, managed investments, loans and debentures, and listed shares and securities.
This approach is intended to keep pension payments steady, while also providing an incentive to invest, as any interest you earn above the deeming rate doesn’t count towards income assessments.
It may be worth contacting Centrelink or a financial adviser to get a better idea of how deeming rates and changes to them could affect your income and lifestyle.
How much are deeming rates going up by?
Deeming rates will rise by another 0.5% in September, marking the third rise since a pandemic-induced freeze was lifted last year.
As of next month, pensioners will face deeming rates of 1.75% for financial assets valued up to $66,800 for singles or $110,600 for couples.
Assets worth more than those thresholds will be deemed at a rate of 3.75%.
If you hold deemable assets and receive the Age Pension, you might find your payments shrink come 20 September, or that some of your indexation benefits are offset by a higher rate of deeming.
The Council on the Ageing (COTA) Australia has welcomed what it calls a “measured approach” to deeming rates, and said banks have a “moral responsibility” to ensure interest rates earned on pensioners’ deposits are higher than the rate assumed by Services Australia.
“We’d also encourage every Age Pensioner with money in savings or term deposits to check the interest rate they’re receiving,” COTA Australia Chief Executive Officer Patricia Sparrow said.
“If the Government assumes your money is earning a certain amount, you should make sure your bank is paying you at least that much.”
This article was reviewed by our Deputy Finance Editor Alasdair Duncan before it was updated, as part of our fact-checking process.
