Deeming Rates Increase 20 September 2026: New Rates and What They Mean for Your Age Pension

by Nasser ZreikaSep 2, 2026Centrelink & Age Pension

From 20 September 2026, social security deeming rates rise to 1.75% (up from 1.25%) on financial assets up to $66,800 for singles and $110,600 for couples. Above those thresholds, the rate rises to 3.75% (up from 3.25%). It’s the third increase since the pandemic-era freeze ended, and it affects the income test for the Age Pension, DSP, Carer Payment and Commonwealth Seniors Health Card — even if your actual investment returns haven’t changed. Here’s exactly how deeming works and what to check before the change lands.

The New Deeming Rates From 20 September 2026

From 20 September 2026, the social security deeming rates increase as follows:

Lower deeming rate: up from 1.25% to 1.75%, applying to financial assets up to $66,800 for singles and $110,600 for couples (combined)
Upper deeming rate: up from 3.25% to 3.75%, applying to financial assets above those thresholds

This is the third deeming rate rise since the government ended its pandemic-era rate freeze. It applies automatically to everyone assessed under the Age Pension, DSP, Carer Payment and Commonwealth Seniors Health Card income tests, and you don’t need to do anything for it to take effect.

What Is Deeming and How Does It Work?

Deeming is the method Centrelink uses to estimate the income your financial assets are earning, regardless of what they actually earn. Instead of asking you to report the real interest, dividends or investment returns on each account, Centrelink applies the deeming rates to your total financial assets. It then counts that deemed amount as income under the relevant income test.

This matters because your real returns and your deemed returns are often different. If your savings earn less than the deeming rate, Centrelink assesses you as if you earned more than you actually did. If your investments earn more than the deeming rate, Centrelink doesn’t count the excess at all — which can work in your favour.

What Counts as a Financial Asset for Deeming?

Centrelink’s deeming rules apply to a broad range of financial assets, including:

Savings accounts and term deposits
Shares, exchange-traded funds and managed funds
Account-based pensions and annuities purchased after 1 January 2015 (some older account-based pensions are grandfathered and assessed differently)
Listed and unlisted securities, and most superannuation balances once you’re of Age Pension age (super in accumulation phase isn’t deemed until you reach Age Pension age)
Gifted amounts above Centrelink’s allowable gifting limits, which Centrelink continues to deem as if you still held them for five years

Your principal home, most personal effects, and some other assets fall outside the deeming rules — though the separate assets test may still count them.

How the Deeming Calculation Works: An Example

This is a simplified, illustrative example only — it isn’t a real client’s figures and doesn’t account for the assets test, other income, or your specific asset mix. It’s included purely to show how the calculation works.

Say a single pensioner holds $150,000 in financial assets. From 20 September 2026:

Centrelink deems the first $66,800 at 1.75%, working out to $1,169 a year
It deems the remaining $83,200 at 3.75%, working out to $3,120 a year
Total deemed income: $4,289 a year (about $164.96 a fortnight), regardless of what the assets actually earned

Under the previous rates (1.25% and 3.25%), the same $150,000 would have produced $835 plus $2,704 — a total of $3,539 a year. That’s about $750 a year less. This gap is the deeming rate rise, and Centrelink adds it to your other assessable income under the relevant income test.

How This Affects Your Age Pension

If you receive the full Age Pension, deeming changes generally don’t affect your payment, because the income test isn’t currently reducing your rate. If you’re on a part pension, the higher deeming rate increases your assessed income, which can reduce your pension slightly under the income test taper. This could offset some or all of the September rate increase — see our full Centrelink payment increases guide for the complete picture.

How This Affects the Commonwealth Seniors Health Card

The Commonwealth Seniors Health Card has no assets test, but it does use deeming to assess income from account-based pensions and other financial assets. The CSHC income thresholds are fixed dollar figures. A higher deeming rate can push someone’s assessed income over the threshold even if their real investment returns haven’t changed. See our full guide to the CSHC income test for the current thresholds and how the calculation works.

What Should You Do Before 20 September?

Ask Centrelink or a financial adviser to estimate your deemed income under the new rates before the change takes effect
If you’re close to a pension or CSHC income threshold, review how you’ve structured your assets — the type and mix of financial assets you hold affects your deemed income
Check whether any of your account-based pensions are grandfathered, as Centrelink assesses these under different, often more favourable rules
Don’t make asset decisions based on deeming alone — weigh any changes against your actual investment goals, risk tolerance and tax position

If you’d like help understanding how the September 2026 deeming rate rise affects your specific pension, DSP or CSHC assessment, Lincoln Wealth Advisors can help. We’ll review your asset structure and model the impact for you.

Frequently Asked Questions

Do I need to report anything for the deeming rate change to apply?

No. Services Australia applies deeming rates automatically to your existing financial assets. You don’t need to notify Centrelink or update your account balances. The updated rates take effect automatically.

Does deeming apply to my home?

No. Your principal home is exempt from the income test’s deeming rules because Centrelink doesn’t classify it as a financial asset. However, your homeownership status still matters for the separate assets test. It applies different thresholds depending on whether you own your home.

Will the deeming rate rise cancel out my September pension increase?

It depends on your situation. Deeming generally won’t affect full pensioners, since it only impacts payments that the income test reduces. For part-pensioners with significant financial assets, the higher deemed income could offset some or all of their rate increase. See our full Centrelink payment increases guide for the complete picture.

Is superannuation deemed before I retire?

No. Centrelink deeming doesn’t apply to accumulation-phase superannuation — the super you hold before reaching preservation or Age Pension age. This super is also generally exempt from income and asset tests for working-age payments like the Disability Support Pension (DSP).

Your super balance only becomes assessable under the assets test — and subject to deeming for the income test — once you reach Age Pension age (currently 67). It can also become assessable earlier if you convert your super into an account-based pension