The Guides to Social Policy Law is a collection of publications designed to assist decision makers administering social policy law. The information contained in this publication is intended only as a guide to relevant legislation/policy. The information is accurate as at the date listed at the bottom of the page, but may be subject to change. To discuss individual circumstances please contact Services Australia. Couple, both pension age, farm producing no income


This topic shows how the assets test hardship provisions apply to a homeowner couple with:

  • both eligible for Age, and
  • a farm that produces no income which they are unable to sell.

General information on the method of calculating the rate of pension paid under the hardship provisions is contained in the referenced section. All calculations are based on limits applying at 20 September 2019. Asset amounts are in dollars. Income amounts are in dollars per fortnight (pf).

Policy reference: SS Guide 4.6.7 Asset hardship rules

Couple's financial details

In this example, the couple's details are as follows:

Assets $
Value of farm excluding home and curtilage

Value of other assets personal and household effects





Assets Limit (couple combined, homeowner) 863,500
Income Nil

Entitlement is precluded under the assets test.

Inquiries show that the commercial lease value of the property is $10,000 a year. There is no actual income from the farm.


The value of the property can be disregarded IF the couple can show that:

  • the property is on the market at a reasonable price (within 10% of the Centrelink's valuation), AND
  • they are unable to borrow against it.
  • Example: The couple cannot meet the required repayments.

The value of other assets that they could NOT be expected to sell or borrow against can also be disregarded.

Example: Their personal and household effects and their car.

They meet the test of severe financial hardship because their income and readily available funds are below the relevant limit ($36,582 for partnered pensioners (combined), see

Notional ordinary income is assessed at the commercial lease value of the property ($10,000 a year or $384.61 a fortnight), as this amount is less than 2.5% of the net market value ($22,500).

Act reference: SSAct section 1132(5) Notional fortnightly rate of ordinary income from unrealisable assets

Calculation of rate under the hardship provisions

The following table shows the rate calculation under the hardship provisions.

Step Action $
1 For unrealisable assets, calculate notional ordinary income:

  • Commercial lease value = $10,000
  • $10,000 ÷ 26
  • This is because the commercial lease value ($10,000) is lower than the 2.5% asset value ($22,500)



2 Calculate any income received from exempt assets. 0.00
3 Calculate the deductions for assets that are NOT unrealisable or exempt. 0.00
4 Determine the rate payable:

  • Maximum rate of pension, couple, combined = $1,407 ($36,582 ÷ 26)
  • Less notional ordinary income
  • Less other asset deductions






Calculation check

The calculation can be checked, by adding the rate payable (from the calculation) to the actual income earned. The result MUST be LESS than the maximum rate payable, as follows:

Calculation check $
Rate payable to claimant

Actual income



RESULT 1,022.39

This amount is less than the maximum rate of $1,407 (combined) for a pensioner couple, therefore $1,022.39 pf combined is the amount payable under the assets test hardship provisions (

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