How the income test works, with examples

Q: Where can I find the official rules for how the income test works, with examples?

The official source is DSS Guide to Social Security Law. All information on this page is checked against that source and dated October 2026.

Q: Is this guide up to date?

This guide was last checked in October 2026. Centrelink rates and rules change — always verify against the official source before making decisions.

What counts as income?

Centrelink counts most forms of money you receive as income, including:

Wages and salary (including tips and overtime)
Self-employment income (gross, before expenses in some cases)
Investment income (interest, dividends, rent)
Deemed income from financial assets (see deeming guide)
Foreign income

It does not count your regular Centrelink payment itself, most compensation payments, or income from some assets like the family home.

The income-free area

You can earn up to a certain amount per fortnight before your payment starts reducing. This is called the income-free area.

From 20 September 2026:

JobSeeker: $150/fortnight
Age Pension / DSP / Carer Payment: $212/fortnight (single)
Youth Allowance: $143/fortnight

Once you earn above the free area, your payment reduces by a set amount for each dollar over. For JobSeeker, this is 60 cents per dollar earned over $150.

Worked example: JobSeeker

Say you receive JobSeeker ($833.70/fn maximum) and earn $350 in a fortnight.

Income above free area: $350 − $150 = $200
Reduction: $200 × 60¢ = $120
Your payment: $833.70 − $120 = $713.70/fn

Use the allowance estimator tool to run your own numbers.

Official source

The full income test rules are in the DSS Guide to Social Security Law, Part 4.1. Rates confirmed against the DSS Guide to Australian Government Payments, effective 20 September 2026.

Questions about this guide

Where can I find the official rules for how the income test works, with examples?

The official source for this guide is DSS Guide to Social Security Law. All information on this page is checked against that source and dated October 2026.

Is this guide up to date?

This guide was last checked in October 2026. Centrelink rates and rules change — always verify against the official source before making decisions.

Can I use this guide to make a claim?

This guide will help you understand your entitlements and prepare your claim, but you must submit the actual claim through myGov or at a Centrelink service centre. We never ask for or store any personal information.