As the cost of living continues to rise, many Australian seniors are feeling the pinch on their finances.

However, those on the Age Pension could see a potential boost thanks to some changes in the Work Bonus scheme.

Yet this initiative could also see more retirees consider re-entering the workforce to supplement their income.

In a new update, the government permanently increased the Work Bonus income bank limit from $7,800 to a more generous $11,800.

New pension claimants could also see a $4,000 starting balance instead of starting from scratch.

For those who are rejoining the scheme, topping up to a $4,000 balance is also on the cards.

Centrelink's Work Bonus scheme could boost pensioners' incomes in a new update. Image Credit: Shutterstock/Nils Versemann

Financial adviser Alex Jamieson explained the benefits of this scheme, noting that a new Age Pension claimant could 'get $4,000 straight up' to their Work Bonus balance.

According to him, any unused portion of the Work Bonus can be carried over into the following year, significantly boosting a retiree's financial flexibility.

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Services Australia confirmed that those who claimed between December 1, 2022, and June 30, 2024, will be eligible for a one-off Work Bonus boost of $4,000, provided they have yet to receive one.

The Work Bonus scheme is for pensioners who want to work without worrying about reduced Centrelink payments.

Under this scheme, pensioners can earn up to $300 every fortnight from employment.

Any unused amount could be stored in an 'Income Bank' for future use.

With around 195,000 new Age Pension recipients each year, this change could impact a significant number of older Australians.

Members accrue $300 to their Work Bonus balance each fortnight, now up to the maximum of $11,800.

Centrelink then uses this balance to offset any future income from work that would usually be counted under the income test.

Pensioners don't need to apply separately for the Work Bonus.

All they need to do is inform Centrelink about any income received from work, and they'll take care of the rest.

You may read more about the Work Bonus here.

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As of writing, single pensioners could receive up to $212 a fortnight from any source and still be eligible for the full pension, while couples can receive $372 a fortnight.

With the Work Bonus, single pensioners could earn $512 a fortnight and $672 a fortnight for couples, all without affecting their Centrelink benefits.

Jamieson suggested that pensioners could typically work around 'one to two days per week' and recommended looking for casual employment that offers flexibility to navigate the income test thresholds easily.

Key Takeaways

• Centrelink's Age Pension recipients could receive a $4,000 boost to their Work Bonus balance under new changes to the scheme.
• Pensioners could earn up to $300 each fortnight from work without their Age Pension payments being reduced, with the ability to bank unused portions.
• A one-off boost of $4,000 is available for new claims lodged between December 1, 2022, and June 30, 2024, should they have yet to receive a boost.
• The increased Work Bonus could allow pensioners to work one to two days per week without affecting their Centrelink benefits, helping to mitigate cost-of-living pressures.

Are you an older Aussie who has returned to work or is considering it? Share your experiences and thoughts about this update with us in the comments below.

 

[Rendrag]

I know senior couples who. Have taken some work for $2-300 per fortnight and have been penalized by centrelink. Regardless of what they say, they still lose pension ! A centerlink representative actually said to them "you would have been better off if you hadn't told us" !!!! Please explain better the difference between $11,800 work bonus and the _$300 tax free first earnings....

 

[Dynamo]

What about if you have medical conditions and are now unable to work, due to being aged??

Yes. I can no longer work due to long standing Parkinsons. Excuse pun. I also care for my older husband. There must be many pensioners in similar positions.

 

[tqueenie55]

And you going to have all the hassle with ATO, ........at 70 I fill like just shooting myself, making it easyer for everybody !

 

[Tervueren]

I am an age pensioner 83years old, I am a crossing supervisor in Frankston have been doing it for 33years, love the little children, if you want a part time job this is the one, you get good pay and still get the pension, have to let social security know every fortnight what you earn, also you get super, holiday pay and sick pay and long service leave. Its worth while also does not affect my husbands age pension as well. In the UK and New Zealand you can earn a lot and still get the full pension and don't have to let the social security know how much you earn.

Thanks for sharing this helpful information.

 

[Lelly]

You can earn the amount from any source, not working only, so investments or part pension from birth country if you had worked long enough there to get a part pension. I get some from UK but it never goes up and isn't enough to affect my pension. Also it fluctuates because of the floating AU dollar but never by enough to get near the limit, and even less likelihood now.

I get an amount around $300 from NZ super and Centrelink takes the equivalent out of my Australian pension every fortnight!! Don’t know why isn’t that considered earnings??

 

[BarveheartBSD]

This is pretty limited. I'm recently retired, was working retail @ $25 per hour, 2.5 days per week. The $4000 work bonus was depleted in 2 months, and on rethinking, decided to quit working. Driving 80km per day, 3 days per week, was just not worth it.

I may look into something closer, but working more than one day per week seems a bit harsh when I'm fit and able to work.