The deeming rate freeze will be welcomed by clients of Centrelink to whom it is applied in determining their benefits and payments under various services administered by Services Australia – including the Commonwealth Seniors Health Care Card. During the long period from the Global Financial Crisis (the GFC) of 2008 when interest rates fell dramatically, successive governments were slow – and reluctant – to reduce the deeming rate. This action by the current government will hopefully compensate at least some of those who previously suffered.
We thank and acknowledge MLC Tech Matters for their article which has provided the substance for this post.
On 1 July 2022, the Government confirmed the freezing of deeming rates for two years until 30 June 2024. This measure, which was announced as one of this year’s Federal Election policies, may benefit:
- income-tested pension and allowance recipients who would otherwise have had a reduced entitlement
- Commonwealth Senior Health Care Card holders who have an account-based income stream subject to deeming as part of their adjusted taxable income
- Low Income Health Care Card holders who may have otherwise lost their entitlement to the card, and
- aged care recipients, as certain income is determined by deeming rates which may have resulted in higher assessable income leading to an increase in means-tested fees.
In addition, the deeming threshold was indexed on 1 July 2022. This may be indexed in future years and provide even greater benefit to income-tested pension and allowance recipients.
The current deeming rates and thresholds are shown in the table below.
| Deeming rate | Single | Couple (includes illness separated) | Non-pensioner couple (each) |
| 0.25% | First $56,400 | First $93,600 | Up to $46,800 |
| 2.25% | Above $56,400 | Above $93,600 | Above $46,800 |
The advice team at Continuum Financial Planners Pty Ltd can assist you to take advantage of this announced deeming rate freeze to ensure you aren’t paying more than you should for your Aged Care contribution, that any entitlement to the Seniors Health Care Card is properly determined – and otherwise as is appropriate to your circumstances. If you are already a client of ContinuumFP, please contact your adviser; and if you would like to engage our services, please contact our office – either by phone (07-34213456); or using our Contact Us Page.
(This article has been posted in July 2022; and may be revised or refreshed periodically.)
