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Daniel Arcadiou
Daniel Arcadiou

Financial Adviser

Adelaide

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How overseas travel impacts your Age Pension payments

Many of us dream about retiring overseas or enjoying extended periods of overseas travel during retirement. While drawing up your travel checklist, don’t forget to consider possible impacts to your Age Pension payments. While you can normally keep receiving the Age Pension while outside Australia, payments are impacted by how long you’re away, any changes to income and assets, and whether your pension is through a social security agreement with another country.

How long you’re away

Less than six weeks:

Your Age Pension won’t change, and you don’t have to inform the government of your trip.

More than six weeks:

If you plan to go away for more than six weeks or emigrate to another country, you will receive an ‘outside Australia’ rate and your Pension Supplement will be reduced to the basic rate. Your Energy Supplement will also stop.

Possible change on the horizon

The 2016-17 budget proposed that the government put a stop to the Pension Supplement Basic Amount for Australians who have been overseas for six weeks, or immediately if the recipient has permanently departed Australia. This measure is meant to strengthen the residence-based nature of Australia’s social security system. This legislation has yet to pass.


More than 26 weeks:

Your rate will depend on how long you were an Australian resident between the age of 16 and Age Pension age. If you were an Australian resident for 35 years or more, your rate normally won’t change. If less than 35 years, you’ll get a lower rate, for example, if you were a resident for 15 years, you’ll get 15/35ths of your usual rate.

Your rate will also remain unchanged of you were an Australian resident for 25 years or more and were also receiving the Age Pension or another Australian social security payment while living outside Australia on 1 July 2014.

The rate of payment is then calculated under both the income and assets tests, with the rate decreasing for both singles and couples by $3 a fortnight for every $1,000 of additional assets above the allowable assets limit.


Exceptions to look out for:

  • If you come back to live in Australia from another country and start getting Age Pension, your payment stops if you go overseas during the next 2 years
  • This rule also applies if you received payments under a social security agreement with another country while outside Australia.
  • If you leave Australia temporarily but stay an Australian resident, this normally counts as part of the 2 years. If you go to a country we have a social security agreement with, you may still get Age Pension during the 2 years.

Key takeaway

If you’re leaving the country for less than six weeks, you don’t have to worry about informing the Department of Human Services. Your Age Pension payments will remain unaffected. In all other cases, use your Centrelink online account, visit your nearest Centrelink centre or call the older Australians line to share your plans to travel or live overseas.

Deciding to travel for a long period requires careful planning and is an important financial decision. Speak to your qualified financial adviser to find out the most effective and comfortable way to make your money work for you while you take that long-awaited trip.

Find out how you can achieve your travel goals


General advice disclaimer: This article has been prepared by FMD Financial and is intended to be a general overview of the subject matter. The information in this article is not intended to be comprehensive and should not be relied upon as such. In preparing this article we have not taken into account the individual objectives or circumstances of any person. Legal, financial and other professional advice should be sought prior to applying the information contained on this article to particular circumstances. FMD Financial, its officers and employees will not be liable for any loss or damage sustained by any person acting in reliance on the information contained on this article. FMD Group Pty Ltd ABN 99 103 115 591 trading as FMD Financial is a Corporate Authorised Representative of FMD Advisory Services Pty Ltd AFSL 232977. The FMD advisers are Authorised Representatives of FMD Advisory Services Pty Ltd AFSL 232977.