Will Your Age Pension Actually Go Up in September? The Deeming Rate Offset Explained

by Nasser ZreikaSep 10, 2026Centrelink & Age Pension

If you receive the full Age Pension, the September 2026 increase reaches you in full — deeming doesn’t affect you because you already sit at the maximum rate.

If you receive a part pension under the income test and hold financial assets like super, an account-based pension or savings above the deeming thresholds, the rise in deeming rates (1.25%→1.75% and 3.25%→3.75%) could offset some or all of your increase, because Centrelink will now assume your assets earn more income than before — whether or not they actually do.

So will my Age Pension go up this September? For most people, yes — but by how much depends on whether deeming eats into it. Every headline this month repeats the same line: “the Age Pension rises $36.80 a fortnight.”

Almost none of them mention that on the very same day, Centrelink also raises the deeming rates it uses in your income test — and for many part-pensioners, that second change quietly cancels out part of the first.

How the Deeming Rate Offset Actually Works

Centrelink doesn’t ask what your super or savings actually earned. It applies deeming rates — an assumed rate of return — regardless of your real investment performance. From 20 September 2026:

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

If you fall under the income test rather than the assets test, a higher deemed income pushes your assessed income up — and that reduces your pension under the income test taper at exactly the moment your maximum rate rises. See our full deeming rate breakdown for the complete new rate table.

A Worked Example

Take a single retiree holding $400,000 in financial assets, receiving a part pension under the income test.

Before 20 September: Centrelink deems this income at 1.25%/3.25%.
After 20 September: Centrelink deems the same $400,000 to earn more — purely because the assumed rates rose, not because the portfolio changed at all.
Net effect: the higher deemed income absorbs part of the $36.80/ft rate rise, so this retiree receives a smaller real increase than the headline figure — and near the taper point, the net gain can shrink close to zero.

Whether — and how much — this affects you depends on three things:

Whether Centrelink assesses you under the income test or the assets test (only the income test responds to deeming)
How much of your assets sit above the deeming thresholds ($66,800 single / $110,600 couple)
How close you sit to the taper point where your pension starts reducing.

Who Doesn’t Feel This Effect

Full pensioners, since they already receive the maximum rate and face no income-test reduction
Part pensioners whom Centrelink assesses under the assets test rather than the income test, since deeming plays no role there
Anyone whose financial assets sit entirely below the deeming thresholds

Who Should Check Their Numbers Now

Part-pensioners holding $150,000 or more in super, account-based pensions, term deposits or shares
Anyone who already sat close to the income test taper point before September
Commonwealth Seniors Health Card holders — the same deeming rise affects the CSHC income test, and since CSHC carries no assets test, deemed income decides eligibility on its own

What You Can Do About It

Most news coverage stops at the headline rate, because addressing this properly takes personal advice rather than a general explainer:

Restructure your assets where it makes sense — some structures sit differently under deeming versus the assets test, and three practical restructuring options can reduce your deemed income
Time asset sales or restructures around indexation dates rather than after them
Check which test binds you post-September — the higher deeming rates can flip whether the income test or the assets test determines your payment
Review your Commonwealth Seniors Health Card eligibility separately, since a small deemed-income rise can decide whether you keep qualifying

Frequently Asked Questions

Will my Age Pension go up this September?

If you receive the full Age Pension, yes — the full $36.80/ft rise reaches you. If you receive a part pension under the income test and hold assets above the deeming thresholds, your Age Pension may still go up, but likely by less than the headline figure, because the deeming rate rise offsets part of the increase.

Does the deeming rate rise affect everyone on the Age Pension?

No. It only affects pensioners whom Centrelink assesses under the income test and who hold financial assets above the deeming thresholds. Full pensioners and those assessed under the assets test feel no impact from this specific change.

Will my pension actually go down because of this?

Usually not below your current rate — but your net increase on 20 September may land smaller than the advertised $36.80/ft, and in rare cases close to zero if you sit near the income test taper point.

Does this affect my Commonwealth Seniors Health Card too?

Yes. The CSHC income test uses the same deeming rates, and because CSHC carries no assets test, your deemed income alone decides your eligibility.

How do I know which test applies to me?

Centrelink applies whichever test — income or assets — produces the lower pension payment for you. Your Centrelink statement shows which one currently applies, or we can check it for you.