The recent Federal Budget and Federal election have resulted in a number of proposed changes to social security.
The increasing eligibility for the Commonwealth Seniors Health Card is one of them. The announcements made prior to the election are proposals only and legislation will need to be passed for these measures to take effect.
Proposed commencement from 1 July 2022
Proposed change—The Commonwealth Seniors Health Card (CSHC) may be available to you if you’ve reached your Age Pension age, but don’t qualify for the Age Pension due to the income and/or assets test. The CSHC has an income test which is used to determine eligibility for the card.
It is proposed that the income test eligibility thresholds will be increased as below:
| Current | Proposed from 1 July 2022 | |
| Single | $57,761 | $90,000 |
| Couple | $92,416 | $144,000 |
| Illness-separated couple | $115,522 | $180,000 |
What income is assessed?
Eligibility is based on an income test only. No assets test applies. The income test for the card is based on adjusted taxable income (ATI), plus deemed income from certain retirement income streams.
Adjusted taxable income includes:
- taxable income
- foreign income
- tax-exempt foreign income
- total net investment losses
- reportable fringe benefits
- reportable superannuation contributions, and
- deemed income from certain superannuation income streams
What do I need to do?
If you’re an existing cardholder, you don’t need to do anything. You’ll retain your entitlement to the CSHC.
If you think you might be eligible for the card, you’ll need to lodge an application with Centrelink. In addition to meeting the income test and age requirements, there are a number of other eligibility rules. Generally you must:
- Be residing in Australia
- Be an Australian resident, a holder of a permanent residency visa or a holder of a Special Category Visa
- Not be receiving a Government pension, a benefit or an income support supplement from the DVA, and
- Quote your TFN (& partner’s if applicable).
You will also need to provide a range of documents to Centrelink to substantiate your income, and to identify yourself if you’re not an existing social security recipient. More information can be found on the Services Australia website.
Demonstrating eligibility
Eligibility is generally determined by considering the financial year immediately prior to the year of application, relying on information lodged in your tax return.
For example, if you become eligible for the card on 1 July 2022 assuming the income test changes are implemented, the 2021/22 financial year would generally be used to determine your entitlement. However, you may not have received a Notice of Assessment for the 2021/22 year at the time your application is lodged.
If this is the case, your adjusted taxable income in the 2020/21 year may instead be used. If you believe your income has changed significantly since that time (eg due to retirement, illness or certain other one-off events), you may be able to use an estimate of income instead. You would generally need to provide a Notice of Assessment or other evidence to be supplied to Centrelink as soon as possible to substantiate your estimate.
What benefits are provided to CSHC holders?
A number of benefits may be provided, some are state based and vary, depending on your location.
- Cheaper medicine under the PBS
- Refunds for medical costs when Medicare Safety Net is reached
- Bulk billed doctor visits, and
- Concessions such as utility bills, property and water rates, public transport and motor vehicle registration.
Speak with your Pinnacle Adviser for more information…
