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Client Alert - Pension Bonus Scheme

For eligible older Australians who defer claiming Age Pension and instead remain in the workforce, the Pension Bonus Scheme (the scheme) pays a tax-free lump sum when they eventually claim and receive Age Pension.

A pension bonus can only be paid to people who have not received Age Pension or any other income support payment (other than Carer Payment) since reaching pension age.

People must register to participate in the scheme. To be eligible to register the applicant must have turned pension age and met residential requirements before 20 September 2009.

The scheme will be closed to new registrations from 1 July 2014. People who are already registered in the scheme will not be affected by this change. Those who are eligible can continue to lodge applications to register up until the date of closure. 

People who register within 13 weeks of becoming qualified for Age Pension automatically have their registration backdated to when they first qualify for Age Pension. People who register outside the 13 weeks generally have their registration start from the date they apply unless special circumstances exist.

To receive a pension bonus, a person must work a minimum of 12 months from the date of registration and complete at least 960 hours of paid work in this and any subsequent years. This is an average of 20 hours each week for 48 weeks each year. For couples, only one person need pass the work test. At least 640 hours of the required 960 hours must be performed within Australia.

A pension bonus can be accrued for a maximum of 5 years and cannot be accrued after the age of 75 (but work by a person after age 75 can accrue towards the bonus of a younger partner who has not accrued the maximum of 5 years).

The pension bonus is paid when a person first claims and receives Age Pension. The claim for bonus and Age Pension must be lodged together. Unless special circumstances exist or the person's membership is non-accruing, the bonus must be claimed within 13 weeks of failing to meet the work test.

For further information about the Pension Bonus Scheme, please call us, or visit the Pension Bonus Scheme section of the Centrelink website.
Our Key Services
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    Our team of professionals will ensure your business complies with Australian tax, company and employment legislative requirements. Read more +

  • Specialist Tax

    Our experienced team is available to provide answers to a broad range of questions in all areas of tax. Read more +

  • Superannuation
    Estate & Succession

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Client Testimonials

Thornton's have constantly provided service of the very highest level, are responsive to our needs and are progressive in their offerings without ever being pushy. Importantly, the people we need to speak to are always available when we need assistance or advice on a range of matters and deliver when they say will. They are one of our most trusted partners in business...

Daniel Colgan, Director, Colgan Industries Pty Ltd

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Our company has found Marie and the team at Thorntons to be extremely helpful in their approach to our business. They are always ready with a reply to our emails or phone calls. Nothing is too much trouble for Marie and the team, they go above and beyond to help us with our taxation. I would recommend them anytime.

Splitrock Farming Co., Kerry Robinson

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Thorntons has been our business and accounting advisors for more than a decade. Thorntons team of dedicated and experienced staff ensure all of our financial requirements are addressed in a professional and timely manner. No issue is ever too big or small and it has been a pleasure working with them as our family business has grown over the past thirteen years.

Keryn McKinnon, Business Manager, Duraseal

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On behalf of Aquatec I would like to say that getting Thornton’s to provide management reports and business consulting has been the best thing we ever did. Moving from a “standard” accounting practice that wasn’t really giving us any proper advice to Thornton’s helped us transform our business and gave us a crystal clear picture of our business health on a month to month basis. Overall a great company to work with, would highly recommend them.

Andy Baker, General Manager, Aquatec Equipment

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I work collaboratively with Troy, Marie and their team in the areas of estate planning, farm succession planning and related party property transactions. Troy and Marie’s attention to detail and professionalism are of the highest standard and they work hard to attain practical and viable business solutions for their clients. They are both clear communicators, accessible and a pleasure to work with.

Julie Murray, Solicitor, Yarramundi Law

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Over the 5 years that my company has been a client of Thornton's, I have been extremely happy with their level of expertise and service. All of my enquiries have been dealt with in a timely and friendly manner. I would have no hesitation in recommending their services.

Hamish Pryde, Director, GlobalSD Pty Ltd

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