Australians receiving Centrelink payments will see important financial changes from 20 March 2026, when the federal government applies its scheduled indexation adjustments. Occurring every March and September, indexation is designed to keep income support payments aligned with inflation and broader economic conditions.
The March 2026 update is particularly significant because it combines two key developments: an increase in base payment rates and a revision of deeming rates used in income assessments. While many pensioners will welcome higher fortnightly payments, others may find the impact more nuanced due to the changes in asset-based income calculations.
Here is a clear breakdown of what will change, who is affected, and how the Age Pension could move beyond $1,200 per fortnight.
What Happens on 20 March 2026
Indexation ensures that Centrelink payments maintain their purchasing power. The March 2026 adjustments will apply to several major payments, including:
- Age Pension
- Disability Support Pension
- Carer Payment
- JobSeeker Payment
- Parenting Payment
- ABSTUDY Living Allowance for eligible recipients aged 22 and over
- Commonwealth Rent Assistance
For single recipients receiving the full Age Pension rate, projections indicate an increase of around $22.20 per fortnight. While final figures will be confirmed in the official indexation tables closer to implementation, this estimate provides a reliable indication of the direction payments are heading.
Before the March 2026 adjustment, the maximum fortnightly Age Pension payment for a single person is approximately $1,178.70. This amount includes the base pension rate, pension supplement, and energy supplement.
If the anticipated $22.20 increase is applied, the updated maximum payment would reach approximately $1,200.90 per fortnight. That would mark the first time the full-rate single Age Pension surpasses the $1,200 threshold.
It is important to note that this figure applies only to recipients on the full rate. Those receiving part pensions will see adjustments based on their individual income and asset assessments.
Deeming Rates Also Changing
Alongside the increase in base payment rates, the government will update deeming rates from 20 March 2026.
Deeming is the method Centrelink uses to estimate income from financial assets such as savings accounts, shares, managed funds, and term deposits. Rather than assessing actual returns, Centrelink applies a standard rate of return to calculate deemed income for the income test.
The new deeming rates from March 2026 will be:
- 1.25 percent on financial assets up to $64,200 for singles or $106,200 combined for couples
- 3.25 percent on amounts above those thresholds
These adjustments follow updated economic and actuarial assessments and represent the first meaningful shift in deeming settings after a prolonged period of stability.
While indexation increases the maximum payment rate, higher deeming rates may raise the amount of income Centrelink assumes you earn from your assets. For some part-rate pensioners, this could reduce their overall entitlement under the income test.
Who Benefits Most from the March 2026 Boost
Age Pension Recipients
To qualify for the Age Pension and receive the indexed increase, individuals must:
- Be 67 years of age or older
- Meet Australian residency requirements
- Pass both the income and assets tests
Current recipients do not need to lodge a new claim. The updated rate will be applied automatically, provided personal and financial details remain accurate in the system.
Full-rate pensioners are positioned to benefit most directly from the increase, as they are less likely to be affected by deeming adjustments. Those with limited financial assets typically see the full indexation amount reflected in their fortnightly payment.
Disability Support Pension and Carer Payment
Recipients of Disability Support Pension and Carer Payment will also receive adjustments in line with the March indexation cycle. These payments follow a similar review schedule to the Age Pension and are updated using comparable economic benchmarks.
JobSeeker, Parenting Payment and ABSTUDY
Working-age payments such as JobSeeker and Parenting Payment will also be indexed. ABSTUDY Living Allowance recipients aged 22 and over are included in the March review. Commonwealth Rent Assistance is typically revised at the same time, offering some relief to renters facing ongoing housing cost pressures.
Each category has different income thresholds and eligibility rules, so individual increases will vary.
How Deeming Changes Could Affect Part-Pensioners
For pensioners receiving a part rate, the interaction between indexation and deeming is crucial.
If you hold substantial financial assets, Centrelink will apply the higher deeming percentages to calculate assumed income. This may increase your assessed income under the income test, potentially reducing the pension amount you receive.
For example, a retiree with significant savings above the lower threshold will have more of their assets assessed at 3.25 percent. Even if actual investment returns are lower, the deemed figure will be used in calculations.
This does not automatically mean pension payments will fall. In many cases, the increase in the base pension rate may still outweigh the additional deemed income. However, those close to income test limits should carefully review their position.
Full-rate pensioners with minimal financial investments are generally less exposed to the impact of higher deeming rates.
Steps Pensioners Should Take Now
There is no need to reapply to receive the March 2026 increase. However, preparation remains important.
Recipients should:
- Log into their MyGov account to confirm income and asset details are up to date
- Report any recent changes in savings, investments, superannuation drawdowns or relationship status
- Monitor official announcements for final rate confirmation
- Seek financial advice if they are near income or asset thresholds
Australians approaching retirement age in 2026 may benefit from reviewing their financial structure early. Adjustments to how assets are held or how retirement income is drawn can sometimes influence eligibility outcomes under Centrelink’s assessment rules.
A Key Moment for Pension Policy in 2026
The 20 March 2026 indexation is more than a routine update. It arrives at a time when living costs remain a major concern for older Australians and income support recipients.
For full-rate single Age Pensioners, moving beyond $1,200 per fortnight represents both a symbolic milestone and a practical boost to household budgets. At the same time, the increase in deeming rates reinforces the importance of understanding how financial assets affect entitlement.
Staying informed about how indexation and deeming interact will be essential in the months ahead. Whether you are already receiving support or preparing to apply, careful planning and up-to-date information will help ensure you receive the benefits you are entitled to in 2026.