7.1.4 Requirements for former residents of Australia receiving a portable pension

Summary

A person must satisfy the SSAct definition of Australian resident in order to lodge a proper claim for a pension. Generally, this means they must be residing in Australia when they lodge their claim.

A claim for pension can be lodged by a former resident who has resumed residence in Australia only if, on the evidence available, there is a clear intention to remain permanently in Australia. A person who intends to return to Australia for a defined period only (e.g. 2 years) would not be an 'Australian resident' as per SSAct subsection 7(2).

Specific portability rules apply when a person who was formerly an Australian resident returns to Australia and becomes an Australian resident again and is successful in claiming Age or DSP.

Portability for former residents - Age, DSP

Since 20 September 2000, a former resident who returns to Australia and is granted Age or DSP, or who transfers to Age under SS(Admin)Act section 12, cannot take that pension outside Australia if they leave within 2 years of having resumed residence in Australia. The purpose of this legislation is to discourage people from travelling to Australia just to get an Australian pension to take back overseas.

The 2-year period includes, as separate full days, the day on which the recipient returns to Australia to resume Australian residence and the day on which they leave again.

There is no discretionary power to allow portability of Age or DSP during the 2-year period (note, some exceptions to the 2-year rule apply - see below).

Payment may be suspended for short overseas absences during the 2-year period and does not have to be reclaimed on return to Australia. A short absence from Australia (as long as the person is still classed as an Australian resident) will not impact on the end date of the 2-year period (i.e. the absence still counts towards the person's 2-year period).

Note: This rule also previously applied to WP, WidB and BVA. These payments ceased from 20 March 2020 and recipients transferred to another payment where eligible, such as Age.

Exceptions

Former residents who were granted their pensions before 20 September 2000 are subject to the old rules of 12-months restriction on portability (unless there are unforeseen circumstances).

The same rule applies to someone who has residence in an external territory, comes to Australia for the first time and is granted a pension within 2 years of taking up residence in Australia.

The 2-year former resident waiting period does not apply if the person is eligible for financial assistance under the Medical Treatment Overseas Program in respect of their absence from Australia or needs to accompany such a person.

International social security agreements

If a pension is granted under an international social security agreement or a recipient is transferred from one agreement pension type to another, that pension is subject to the portability rules in the agreement.

From 1 January 2014, people who reside outside Australia being paid under an agreement, who return to Australia for residence and are transferred back to autonomous are to be assessed as a 'former resident'. If they leave Australia again within 2 years (of resuming Australian residence) they will be considered former residents and autonomous entitlement stops on departure (they can be transferred back to an agreement if they're returning to an agreement country).

If a former resident is going to an agreement country and about to have their autonomous pension (1.1.A.360) cancelled because of the operation of SSAct section 1220, they must be informed if there is a possibility of grant or transfer to a similar payment under the agreement.