Centrelink’s $800,000 Strategy is a legal financial approach that helps Australian retirees avoid Age Pension cuts by reducing assessable assets. With asset limits affecting your eligibility, this strategy allows you to remain eligible for full or partial Age Pension using legal exemptions and smart planning.
This guide explains the asset test thresholds, reduction rules, and strategies you can use to restructure your finances effectively in 2025.
Centrelink Asset Test Limits in 2025
Centrelink applies strict asset thresholds to determine your Age Pension eligibility. The following table outlines the updated limits for both full and part Age Pensions:
For Full Age Pension
| Situation | Homeowner | Non-Homeowner |
|---|---|---|
| Single | $314,000 | $566,000 |
| Couple (combined) | $470,000 | $722,000 |
For Part Age Pension
| Situation | Homeowner | Non-Homeowner |
|---|---|---|
| Single | $695,500 | $947,500 |
| Couple (combined) | $1,045,500 | $1,297,500 |
Once your assets cross these limits, your pension reduces by $3 per fortnight for every $1,000 above the threshold.
Top Techniques to Shield Your Pension
Let’s break down the key legal strategies used in the $800,000 Centrelink plan:
1. Gifting Assets Within Limits
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You may gift $10,000 per year and $30,000 over five years without it being counted.
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Any excess is counted for five years.
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Example: Gift $10,000 and reduce your assessable assets from $800,000 to $790,000.
2. Investing in Home Improvements
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Your home is exempt from the asset test.
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Spending on renovations reduces assessable liquid assets.
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Bonus: Improves your quality of life and increases home value.
3. Transferring to a Younger Spouse’s Super
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If your spouse is under Age Pension age, their superannuation is exempt.
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Example: Transfer $200,000 to a 59-year-old spouse’s super and regain pension eligibility.
4. Purchasing Lifetime Annuities
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Converts your lump sum into income stream.
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Only part of the annuity is counted, depending on the structure.
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Reduces both assessable assets and taxable income.
5. Creating a Granny Flat Interest
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Give funds to a child in exchange for a lifetime living arrangement.
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If structured correctly, it won’t be counted as a gift.
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Must have legal agreements in place for Centrelink to accept it.
Other Useful Asset Reduction Ideas
6. Prepaying Funeral Costs
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Up to $15,000 spent on pre-paid funeral bonds is asset test exempt.
7. Downsizing Your Home
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Use proceeds (up to $300,000 per person) to contribute to superannuation.
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Be cautious: sale proceeds are still counted as an asset unless reinvested smartly.
Centrelink’s $800,000 Strategy Summary Table
| Feature | Details |
|---|---|
| Asset Reduction Threshold | $3 cut per $1,000 above limit |
| Gifting Limit | $10,000/year, $30,000 over 5 years |
| Superannuation Exemption | For younger spouse only |
| Home Improvement | Fully exempt from asset test |
| Granny Flat Arrangement | Must be formally documented |
| Funeral Bond Exemption | Up to $15,000 |
| Annuities Benefit | Converts asset into income stream |
FAQs About Centrelink’s $800,000 Strategy
Can I transfer all my money to my children?
No. You can only gift $10,000 per year and up to $30,000 over five years without it impacting your pension eligibility.
How does the $800,000 strategy work?
It helps restructure your assets legally—such as gifting, annuities, or super contributions—to reduce the total counted by Centrelink.
Is super exempt from Centrelink’s test?
Yes, if it’s held by a spouse under Age Pension age. It becomes assessable once they reach pension age.
Can home upgrades help?
Absolutely. Your home is not assessed, so using funds to improve it lowers your countable assets.
Where can I get official details?
Visit Services Australia’s Centrelink page for updated pension rules and asset test information.
Click here to know more.
Aanchal is a passionate writer with a keen interest in storytelling, content creation, and creative expression. She enjoys exploring diverse topics and crafting engaging narratives that captivate readers.