All of your Covid-19 Centrelink questions answered

Centrelink has been making big changes to government entitlements and benefits to help the increasing number of Aussies in financial difficulties or experiencing a big fall in the value of their superannuation as a result of Covid-19.

But with these changes coming thick and fast, it can be easy to lose track of your rights as a recipient or know how to act to better your situation, so to clear up some commonly asked questions, Starts at 60 talked to Justin Bott from the Financial Information Service at Services Australia to get the most sought-after answers regarding Centrelink payments.

(And throughout this story you’ll find helpful links to either the Centrelink webpages where you can find more information or to the Starts at 60 site where we’ve covered the topic in more depth.)

What’s the best way to contact Centrelink?

Unsurprisingly, given the masses of people lining up outside Centrelink branches, the best way to get information or change your details with Centrelink is online. Head to servicesaustralia.gov.au where the top banner on the webpage will direct you to all things Covid-19-related with new information being posted regularly. You can also head to the Facebook page for daily updates.

Although customers can still call through on these numbers, Bott warns that the huge volume of calls Centrelink was receiving meant that phone lines are extremely busy so it’s best to get your information from the website where possible. So having a myGov account that lets you deal with Centrelink online is a must!

Once you have a myGov account, you can link it to other member services such as Medicare, Centrelink, Medicare, ATO and more. This means that you will need to also create a Centrelink online account to link to your myGov account so you can access it once you log in. You can find out more about how to create a Centrelink account here and more about myGov, including how to sign up, here.

“The other thing to note is that this is assuming people are computer literate,” he said. “If you aren’t, you can actually get yourself a nominee who is. You can do that through your Centrelink online account on myGov where there’s a form you can fill out and scan through. If you and your nominee both have Centrelink online accounts than your nominee can actually do all of the work on your behalf.”

If you don’t want to do this through your online account, you can also download and print the form from the website here and return it via post, fax, dropping off at a service centre, or uploading through the document upload feature on your Centrelink online account.

Anyone who has an intention to claim due to Covid-19 i.e. Jobseekers or those who have lost their jobs needs a Customer Reference Number (CRN), which can also be done on your myGov account. People claiming the Age Pension however should continue with the process outlines here.

If your account is already linked to either Centrelink, ATO or Medicare than you should see a box that says “Do you want to register your intention to claim?”. After clicking on this prompt, Centrelink will contact you to work out if you already have a CRN or if you need to get a new one.

“A lot of customers that I’ve been dealing with had one but they didn’t know it,” Bott says. “The CRN that you might have gotten when you were born will be the one you’ll go with until you die. It’s often the case that you might not have realised it, but you do have one, we’ve just got to find it for you.”

When will the stimulus payment hit my bank account?

The Economic Support Payment of $750 for eligible recipients including pensioners started being paid out on March 31 and will start up again for the second round on July 13. But if you’re one of the many who are yet to see the payment hit your bank account, don’t worry.

The release of the stimulus will be staggered between the March 31 and April 17, but don’t expect it to go into your account on the same day that you receive your normal Age Pension payment as it may be paid on a random day during this time. Recipients can go into their Centrelink online accounts through myGov and see the $750 appear up to 48 hours in advance before it’s paid, however, at this point that is as far in advance as customers can be notified.

Should you update your income and assets?

With share prices all over the place, which in turn impacts the value of a superannuation balance, many pensioners are wondering whether they should be getting their income and assets reviewed by Centrelink.

Bott says that legally, recipients are required to notify the agency within 14 days if they’ve had a change in their number of shares, for instance if they’ve bought or sold shares. Pensioners can change their reported income and assets via their Centrelink online account on myGov.

If the shares have only gone up or down in value, and are not newly purchased or sold, it’s not a legal obligation to tell the agency, although you can do so whenever you wish. If you choose not to request a review, two official review dates – March 20 and September 20 – will pick up any changes in values of your shares and market-linked managed investments, although payments will only be adjusted from those dates.

“If you are actively providing some kind of circumstance change like saying you’ve sold the shares then [any increase to your payment] will be backdated,” Bott explains. “But, if you wait until September then it will only go from September. If the share price fell again and you waited until September, then it’ll be based on the share price in September and it’ll ignore the 6 months in between.

“Whether [requesting a revaluation] is worth it is a different question because it doesn’t just trigger the shares that might have fallen but it also revalues those shares and market-linked investments that might have gone up in value. So we have had some customers thinking they were going to get an improvement in some payments only to find that its gone down because share X has reduced while share A, B and C have gone up.”

What if you’ve lost rental income?

Property investors who have an income-tested pension and have suffered a rental income loss should inform Centrelink as soon as their rental income has ceased or been deferred so they can have their pension recalculated and potentially increased. Once rent starts up again, however, the recipient must inform the agency within 14 days.

Those applying for Jobseeker payments in this time will have the asset test waived for around six months or as long as the coronavirus supplement stands for while the income test still stands. It’s worth noting however, the Age Pension and other pensions will remain asset and income tested.

People below pension age who are applying for Jobseeker payments but are drawing an income via super (via an account-based pension or transition to retirement) should know that it is still considered an income source and will be deemed as a financial asset by Centrelink.

“It’s just the same if you put that money in the bank account,” Bott says. “We deem it at the 1 per cent and 3 per cent, soon to become the 0.25 and 2.25 per cent from 1 May 2020.”

What happens if I take an emergency $10,000 from super?

The outcome of the emergency withdrawal of super varies depending on age. Those under the Age Pension age who wish to take out the $10,000 currently permitted by the government only need to tell the agency where the money goes, as the super fund is an exempt asset meaning Centrelink isn’t looking at the balance at all.

“Did the bank account increase by taking the money out?” Bott said. “It’s not treated as an income, so you haven’t earned $10,000, but if you use it to pay off an $11,000 credit card debt then there really won’t be anything left to tell the agency. So for those people under the Age Pension age, it’s only about where the money went.”

It gets slightly more complicated for those over the pension age. For those over 65, the emergency withdrawal is actually irrelevant as they are able to take out as much of their super as they like, whenever they want, completely tax-free.

However at the Age Pension age, which is presently 66, Centrelink is now counting the super balance as an asset, so if you take the $10,000, you need to report the reduction in your fund balance. If it goes into your bank account, then both areas are seen as a financial asset, meaning there’s no change in value only a reshuffle in funds.

If the money is spent, however, your total assets have reduced by $10,000, meaning there’s potential for a pension increase. But without informing Centrelink of the change, there’s no way of knowing if you are missing out so it’s important to update your details via your Centrelink online account on myGov so that your rate of payment will always be correct.

Is my income considered for the Commonwealth Seniors Health Card?

The seniors health card is based on adjusted taxable income, which is normal taxable income plus other things that the ATO doesn’t look at, such as negative gearing. The outcome of the seniors health card depends solely on the date in which you received it and whether or not that makes you a grandfathered case or not.

On January 1, 2015, Centrelink changed how they would assess income from account-based pensions. Anyone who held a card prior to this date, stayed on it the entire time and didn’t change their account-based pension in any way are considered a grandfathered case. This means that their account-based pension is tax-free and is not counted as an income for Commonwealth Seniors Health Card purposes.

For everyone else after this date, however, account-based pensions are a deemed financial asset when eligibility for the Commonwealth Seniors Health Card is determined. This means Centrelink is looking at the basic taxable income, plus other adjustments, as well as deemed interest at the 1 and 3 per cent from the current account-based pension balance.

IMPORTANT LEGAL INFO This article is of a general nature and FYI only, because it doesn’t take into account your financial or legal situation, objectives or needs. That means it’s not financial product or legal advice and shouldn’t be relied upon as if it is. Before making a financial or legal decision, you should work out if the info is appropriate for your situation and get independent, licensed financial services or legal advice.