Cash in on health: Big changes to Seniors Card could boost your savings and health benefits!
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As we navigate the ever-changing landscape of healthcare and benefits, it's crucial to stay informed about the latest updates that could impact our wallets and well-being.
For Australian seniors, there's a significant update on the horizon that could mean more money in your pocket and greater access to healthcare services.
Starting September 20, the Commonwealth Seniors Health Card (CSHC) is set to undergo substantial improvements that could benefit many retirees across the nation.
The CSHC is a concession card issued by Centrelink that provides eligible seniors with access to cheaper prescription medications for less than $8 per script.
In addition, depending on your location in Australia, combining your State's Seniors Card with various discounts on utilities and other expenses can save you thousands each year.
It's especially beneficial for those who are of pension age but do not qualify for a pension due to means testing.
While pensioners receive a Pension Concession Card, the CSHC is designed for those who fall outside of this category.
One of the key benefits of the CSHC is the ability to access the Pharmaceutical Benefits Scheme (PBS) listed drugs at a reduced cost of just $7.70 per script, with an annual cap of $277.20.
After reaching this threshold, medications are free for the remainder of the year. This can be a game-changer for seniors managing chronic conditions or requiring multiple medications.
The upcoming changes to the CSHC include an increase in the income cut-off thresholds, which determine eligibility based on means testing.
For singles, the new annual Centrelink assessable income limit will be $99,025, and for couples, it will be a combined income of $158,440.
This means that more seniors could potentially qualify for the card and its associated benefits.
It's important to understand that the assessable income for CSHC purposes includes a mix of taxable and deemed income from certain assets.
This is distinct from the calculations used for pension means testing. Pre-tax employment income, investment income, and ‘grossed-up’ dividend income from Australian shares (including franking credits) are all considered.
However, there are some deductions allowed, similar to those recognised by the Australian Taxation Office (ATO), such as interest on investment loans and other expenses.
One notable aspect of the CSHC income assessment is the treatment of superannuation. Withdrawals from a standard ‘taxed’ super fund, including regular Account-Based Pension (ABP) payments, are not counted as income.
However, money invested in an ABP is assessed under a deeming system, which assumes a certain rate of return on the investment.
For singles, the first $62,600 in an ABP is deemed to earn 0.25 per cent, and any amount above this is deemed at 2.25 per cent.
For couples, the first $103,800 is deemed at t0.25 per cent, with the remainder at 2.25 per cent.
This deeming system allows for significant superannuation balances without affecting CSHC eligibility.
The upcoming changes mean that a couple with the maximum superannuation balance could have $1.9 million each in super and still qualify for the CSHC.
The deemed income on their combined $3.8 million would be $83,424 per annum, well below the new income threshold of $158,400, leaving an additional $74,876 of ‘wriggle room’ income before the card is lost.
At 67, our couple, having maxed out their account, would need to withdraw 5 per cent annually, equating to over $15,800 per month, tax-free.
They remain eligible for the Commonwealth Seniors Health Card (CSHC), which allows them to pay $7.70 per prescription and travel for free on trains to Mandurah between 9:30 AM and 3:30 PM.
Additionally, they can receive up to $750 off local government charges with their state seniors card.
For an individual, the deemed income on a $1.9 million account-based pension (ABP) would be $84,248, leaving an extra $14,777 they could earn before losing the card.
The CSHC, provided by Centrelink, can be applied online through my.gov.au after linking the Centrelink service to your account.
With significant changes on the horizon for the Commonwealth Seniors Health Card, many retirees are keen to understand how these adjustments might impact their benefits and overall financial situation.
As we anticipate these updates, it's prime time to explore strategies for maximising retirement savings.
In the following discussion, a financial expert provides valuable insights on unlocking hidden funds and boosting your retirement funds to ensure you're well-prepared for the future.
As we approach September 20, it's a good time to spread the word to friends and family who might also benefit from these changes. The Seniors Discount Club is here to keep you informed and help you navigate these updates so you can make the most of your golden years.
What are your thoughts on the upcoming enhancements to the Commonwealth Seniors Health Card? Share your experiences and questions in the comments below, and let's help each other stay informed and prepared for these positive changes!
For Australian seniors, there's a significant update on the horizon that could mean more money in your pocket and greater access to healthcare services.
Starting September 20, the Commonwealth Seniors Health Card (CSHC) is set to undergo substantial improvements that could benefit many retirees across the nation.
The CSHC is a concession card issued by Centrelink that provides eligible seniors with access to cheaper prescription medications for less than $8 per script.
In addition, depending on your location in Australia, combining your State's Seniors Card with various discounts on utilities and other expenses can save you thousands each year.
From September 20, the Commonwealth Seniors Health Card (CSHC) will offer improved benefits for eligible retirees. Credit: Shutterstock
It's especially beneficial for those who are of pension age but do not qualify for a pension due to means testing.
While pensioners receive a Pension Concession Card, the CSHC is designed for those who fall outside of this category.
One of the key benefits of the CSHC is the ability to access the Pharmaceutical Benefits Scheme (PBS) listed drugs at a reduced cost of just $7.70 per script, with an annual cap of $277.20.
After reaching this threshold, medications are free for the remainder of the year. This can be a game-changer for seniors managing chronic conditions or requiring multiple medications.
The upcoming changes to the CSHC include an increase in the income cut-off thresholds, which determine eligibility based on means testing.
For singles, the new annual Centrelink assessable income limit will be $99,025, and for couples, it will be a combined income of $158,440.
This means that more seniors could potentially qualify for the card and its associated benefits.
It's important to understand that the assessable income for CSHC purposes includes a mix of taxable and deemed income from certain assets.
This is distinct from the calculations used for pension means testing. Pre-tax employment income, investment income, and ‘grossed-up’ dividend income from Australian shares (including franking credits) are all considered.
However, there are some deductions allowed, similar to those recognised by the Australian Taxation Office (ATO), such as interest on investment loans and other expenses.
One notable aspect of the CSHC income assessment is the treatment of superannuation. Withdrawals from a standard ‘taxed’ super fund, including regular Account-Based Pension (ABP) payments, are not counted as income.
However, money invested in an ABP is assessed under a deeming system, which assumes a certain rate of return on the investment.
For singles, the first $62,600 in an ABP is deemed to earn 0.25 per cent, and any amount above this is deemed at 2.25 per cent.
For couples, the first $103,800 is deemed at t0.25 per cent, with the remainder at 2.25 per cent.
This deeming system allows for significant superannuation balances without affecting CSHC eligibility.
The upcoming changes mean that a couple with the maximum superannuation balance could have $1.9 million each in super and still qualify for the CSHC.
The deemed income on their combined $3.8 million would be $83,424 per annum, well below the new income threshold of $158,400, leaving an additional $74,876 of ‘wriggle room’ income before the card is lost.
At 67, our couple, having maxed out their account, would need to withdraw 5 per cent annually, equating to over $15,800 per month, tax-free.
They remain eligible for the Commonwealth Seniors Health Card (CSHC), which allows them to pay $7.70 per prescription and travel for free on trains to Mandurah between 9:30 AM and 3:30 PM.
Additionally, they can receive up to $750 off local government charges with their state seniors card.
For an individual, the deemed income on a $1.9 million account-based pension (ABP) would be $84,248, leaving an extra $14,777 they could earn before losing the card.
The CSHC, provided by Centrelink, can be applied online through my.gov.au after linking the Centrelink service to your account.
With significant changes on the horizon for the Commonwealth Seniors Health Card, many retirees are keen to understand how these adjustments might impact their benefits and overall financial situation.
As we anticipate these updates, it's prime time to explore strategies for maximising retirement savings.
In the following discussion, a financial expert provides valuable insights on unlocking hidden funds and boosting your retirement funds to ensure you're well-prepared for the future.
What are your thoughts on the upcoming enhancements to the Commonwealth Seniors Health Card? Share your experiences and questions in the comments below, and let's help each other stay informed and prepared for these positive changes!
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