Can You Collect Old Age Pension Whilst Still Working
Yes, you can work and receive the Age Pension simultaneously. The Work Bonus allows you to earn at least $300 per fortnight without affecting your payment, while a Work Bonus Bank (up to $11,800) protects short-term or seasonal income. Strategic asset structuring can further improve your eligibility.
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Introduction
You can receive the Age Pension once you reach the qualifying age of 67 and keep working. Services Australia applies the Work Bonus to encourage older Australians to stay in the workforce without losing as much of their pension.
Your Age Pension rate is determined by Centrelink's means tests, so your income and assets matter because they dictate whether you receive a full pension, a part pension, or nothing at all. Employment income is treated more generously than other types of income (like bank interest or dividends).
While many people expect their pension to be slashed the moment they earn a wage, the Work Bonus shields a significant portion of your earnings from the income test entirely.
How Does Age Pension Work for Employed Seniors?
Your employment income is assessed in two steps.
Work Bonus
Services Australia adds $300 credit each fortnight to your Work Bonus balance. That balance can build up to $11,800.
When you earn employment income, Services Australia uses your Work Bonus balance to offset your work income before applying the income test. If you earn less than $300 in a fortnight, the unused amount is added to your Work Bonus balance.
Income-Free Area
After the Work Bonus is applied, the regular Age Pension income test is applied.
Services Australia lists the standard free areas as:
- Single: Up to $218 per fortnight, no reduction
- Couple: Up to $380 per fortnight combined, no reduction
Above the free area, the pension reduces by:
- Single: 50 cents for each $1 over $218
- Couple: 25 cents each for each $1 over $380 combined
The Work Bonus can protect your pension during periods of short-term or seasonal work because you can use the built-up balance to offset higher income fortnights.
Assets that Affect Age Pension Eligibility
Centrelink assesses the market value of most assets you own, in Australia or overseas.
Assets Counted
Services Australia lists examples across these categories:
- Financial investments: Bank accounts, cash, term deposits, shares, managed funds.
- Superannuation: Once you reach Age Pension age, your super balance is counted in the assets test and assessed under deeming for the income test.
- Personal property: Cars, boats, caravans, home contents, and personal effects valued at what you could sell them for, not replacement value).
- Real estate: Investment properties and holiday homes
Your principal home is not counted, and Services Australia notes this usually includes up to the first 2 hectares of land it sits on.
Age Pension Assets Test Limits 2026
Services Australia lists these full pension assets test limits:
| Situation | Homeowner | Non-homeowner |
|---|---|---|
| Single | $321,500 | $579,500 |
| Couple | $481,500 | $739,500 |
If your assets are above the full pension limits, you may still receive a part pension until you reach the cut-off points. Services Australia lists these part pension cut-offs:
| Situation | Homeowner | Non-homeowner |
|---|---|---|
| Single | $714,500 | $972,500 |
| Couple | $1,074,000 | $1,332,000 |
If you receive Rent Assistance, the cut-off point can be higher.
Strategic Exempt Assets
If you are close to the assets test thresholds (the cut-off points where your pension begins to reduce), the way you structure your holdings can change your payment outcome. Common examples of shifting money into exempt categories include:
Home Improvements
Because the principal home is generally exempt from the Centrelink assets test, spending assessable cash on eligible home improvements, such as installing solar panels, renovating a kitchen, or adding energy-efficient heating, effectively moves money from a counted asset into an exempt one.
It can increase your fortnightly pension payment while simultaneously reducing your ongoing utility bills and increasing the resale value of your home.
Prepaid funerals & funeral bonds
Services Australia states that funeral costs paid in advance normally do not count in the assets test, provided you have a contract that specifies the services are paid in full.
They also set conditions for funeral bonds, which are exempt if they are used solely for funeral expenses and do not exceed the allowable limit of $15,750 (as of the 2025–26 financial year).
Investing in a bond below this threshold can be a way to set aside money for the future while immediately improving your current pension eligibility.
Younger Spouse Super
While a partner is under the Age Pension age (67), Services Australia does not count their superannuation in the income and assets tests, provided the fund is still in the accumulation phase and not paying a pension. It creates a sheltering opportunity where the older partner (67+) can transfer assets into the younger spouse's super account to lower the couple's combined assessable assets.
This strategy can allow the older spouse to qualify for a much higher pension (or a Commonwealth Seniors Health Card) until the younger partner also reaches age 67.
Conclusion
Working while receiving the Age Pension is allowed, and the Work Bonus can protect a meaningful amount of employment income from the income test. The assets test is often the factor that decides whether you receive a full pension, a part pension, or no pension.
If you are in the Sutherland Shire or Sydney CBD and want to understand how work income, super, and assets will affect your Age Pension, you can book a 15-minute no-obligation call with James Hayes. He can help you map the numbers, check the Centrelink rules that apply to your position, and plan the next steps.
FAQs
Does the Work Bonus apply to all income?
No. Services Australia explains the Work Bonus offsets eligible employment income such as wages and salary. Other income, such as deemed income from financial assets, is assessed under the normal income test rules.
If I take money out of super, does it change my Age Pension?
Services Australia states that withdrawing money from super does not change your payment by itself, but what you do with the money can affect your income and assets tests, such as putting it in the bank or buying an income stream.
Can I work a lot for a short time and keep my pension?
Possibly. Services Australia states your Work Bonus balance can build up to $11,800, and it is used to offset eligible work income before the income test is applied. This can help during periods of higher short-term income, depending on your overall means test position.
Disclaimer
The information in this article is provided as a general guide only. It does not constitute personal financial advice and should not be relied upon as such. Readers should seek advice from a licensed financial adviser before making any financial decisions. James Hayes and his associated entities accept no responsibility or liability for any loss, damage, or action taken in reliance on the information contained in this article. Links to third-party websites are provided for reference purposes only. We do not endorse or guarantee the accuracy of their content.