Centrelink deeming rates rose from 20 March 2026, ending a multi-year freeze. The lower rate lifted to 1.25% and the upper rate to 3.25%, changing how much income Centrelink assumes your savings and investments earn for the pension income test.
Key facts
| What changed | Before | Now |
|---|---|---|
| Lower deeming rate | 0.25% | 1.25% |
| Upper deeming rate | 2.25% | 3.25% |
| Lower-rate threshold — single | — | Up to $64,200 |
| Lower-rate threshold — couple (combined) | — | Up to $106,200 |
| Effective from | — | 20 March 2026 |
What changed and when
On the recommendation of the Australian Government Actuary, the lower deeming rate rose from 0.25% to 1.25% and the upper rate from 2.25% to 3.25%, effective 20 March 2026. The rates had been frozen at their pandemic-era levels since May 2020 to shield pensioners from record-low interest rates; the Actuary's review found current savings rates justify a partial reset, though the new rates remain well below long-term averages and below the returns available on many at-call savings accounts.
The Actuary reviews deeming rates regularly against actual returns available on standard, low-risk investments such as term deposits and online savings accounts at major banks. Because rates on those accounts have risen since the 2020 freeze began, this adjustment brings deeming closer in line with what a cautious investor could realistically earn, while still sitting below the top rates advertised by banks for new deposits.
Deeming thresholds for singles and couples
The 1.25% lower rate applies to financial assets up to $64,200 for a single person, and up to $106,200 combined for a couple where at least one member receives a pension. Anything above those thresholds is deemed to earn income at the higher 3.25% rate, regardless of what the assets actually return. The thresholds themselves are reviewed alongside the Age Pension rate each March and September, so they can move even in years when the deeming percentages themselves stay unchanged.
What counts as a deemed financial asset
Deeming applies to bank accounts, term deposits, shares, managed investments and, for people who've reached Age Pension age, most superannuation balances. Centrelink totals your financial assets, applies the lower rate up to the threshold and the higher rate above it, and counts that assumed income toward your pension income test — whether your actual returns are higher, lower, or negative in a given year. Your home and most personal assets like your car and household contents aren't financial assets for deeming purposes, though they can still count toward the separate assets test.
Why deeming rates matter for the pension income test
Because deemed income is fixed regardless of actual returns, a higher deeming rate can reduce a part-pensioner's payment even if their real investment income hasn't changed. Conversely, someone earning less than the deemed rate on a term deposit or savings account effectively gets counted as earning more than they actually receive, while someone earning above the deemed rate effectively keeps the difference without it affecting their pension. Check your own position with the Centrelink income test guide, which explains how the income and assets tests interact to determine your actual payment rate.
What this means for your pay
If you're approaching retirement and weighing up how much to hold in super versus other savings, deeming rates are one factor in how Centrelink treats different assets. Someone with a large lump sum in a low-interest savings account, for instance, is deemed to earn the same income as someone whose money is invested in higher-yielding term deposits or shares — so the choice of where to hold your savings doesn't change your pension assessment, only your actual returns. Model your retirement balance with the superannuation calculator, and use the Centrelink income test guide to see how the new thresholds interact with any part-time income you're still earning.