7.1.6 Portability for former Australian residents

Introduction

A person must satisfy the SSAct definition of Australian resident (1.1.A.330) 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 person who was previously an Australian resident as per the SSAct definition but ceases to satisfy that definition, for example, because they move overseas to live, is referred to as a former Australian resident.

A former Australian resident who returns to Australia can lodge a claim for a payment if they have genuinely resumed residing in Australia, based on an assessment of their circumstances and the evidence available against the factors listed in SSAct subsection 7(3), and all other claim requirements are met. There should be a clear intention to remain permanently in Australia. A person who intends to return to Australia for a defined period only (for example, 2 years) would generally not be considered to have resumed residing in Australia.

Specific portability rules apply when:

• a former Australian resident returns to Australia
• becomes an Australian resident again, and
• within 2 years of becoming an Australian resident again, is granted or transferred to the age pension or DSP.

These are referred to as the former resident rules.

Note: The former residents rules 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 pension.

Portability of age pension and DSP under the former resident rules

Since 20 September 2000, a person who is subject to the former resident rules is not eligible for portability of their age pension or DSP for any overseas absences that occur within 2 years of resuming residence in Australia. The purpose of these rules is to discourage people from travelling to Australia just to claim an Australian pension to take immediately back overseas.

The 2-year period starts on the day on which the person became an Australian resident again.

If a person who is subject to the former resident rules leaves Australia within the 2-year period, their pension will be suspended on departure. If a pension has been suspended, it can be restored on return to Australia as long as the person returns to Australia within 13 weeks of suspension. If the person remains overseas for 13 weeks, their pension will be cancelled and they will need to re-claim on their return to Australia.

A short temporary 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 (that is, the absence still counts towards the person's 2-year period).

The only exceptions to the former resident rules are where 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, or
• travelling to an agreement country and is eligible to be paid under the relevant agreement (see below).

If a person is covered by one of these exceptions, their pension is portable so long as the exception continues to apply. There is no discretionary power to allow portability of age pension or DSP during the 2-year period outside of the above exceptions.

International social security agreements

The portability provisions in Part 4.2 of the SSAct, including the former resident rules, do not apply where a pension is paid under an international social security agreement. Instead, the pension is subject to the portability rules in the relevant agreement.

If a person is subject to the former resident rules and is going to an agreement country, they may be eligible to move to being paid their current pension under the agreement or transfer to another pension under the agreement. In this case, they will cease to be subject to the former resident rules and will instead be subject to the portability rules in the agreement and can be paid their pension while in the agreement country.

People who are paid under an agreement and who later return to Australia to reside and move to being paid under autonomous (domestic) payment arrangements once back in Australia are not subject to the former resident rules, provided there is continuity of payment. This means they will be eligible for portability if they leave Australia within 2 years of resuming residence.