If you hold a Commonwealth Seniors Health Card or receive Centrelink benefits, deeming rate changes could impact your assessed income and benefit eligibility without any change to your actual financial circumstances.
From 20 March 2026, social security deeming rates have increased. The lower deeming rate will rise from 0.75% to 1.25%, and the upper rate from 2.75% to 3.25%. These rates apply to full and part pensioners, as well as self-funded retirees who hold a Commonwealth Seniors Health Card. The rates will be applied automatically by Services Australia.
Deeming rates are a simplified method used by Centrelink to assess income from your financial investments. Rather than tracking the actual returns from each investment, the government assumes your financial assets earn a set percentage return (the deeming rate).
Under deeming, your financial investments are assumed to earn income at the prescribed rates, regardless of what you actually earn. The lower rate applies to financial assets up to $64,200 for singles and $106,200 for couples (combined). The upper rate applies to balances above these thresholds.
Higher deeming rates can increase your assessed income even when your financial position hasn’t changed. Rate changes may affect:
- Commonwealth Seniors Health Card eligibility if your adjusted taxable income plus deemed income exceeds the threshold;
- Age Pension payments for those subject to income testing;
- some aged care fees, as higher deemed income can lead to higher means-tested care fees; and
- other income-tested benefits or concessions.
Account-based income streams that commenced on or after 1 January 2015 are subject to deeming for social security income test purposes. Where deeming applies, your actual pension payments are ignored for assessment purposes.
This particularly affects Commonwealth Seniors Health Card holders and age pensioners who are subject to income testing.
You may want to:
- review your current Centrelink entitlements and income assessments;
- calculate how the new deeming rates might affect your benefits or fees; and
- consider whether any adjustments to your financial arrangements are appropriate.
