Closing of the Pension Bonus Scheme
The Pension Bonus Scheme (PBS) is a tax-free lump sum bonus for people who work past age pension age (generally past age 65) and defer claiming the Age Pension.
The amount of Pension Bonus paid is based on how long a person has deferred the pension from their date of registration, the rate of age pension payable at date of their claim and if the person is partnered.
As you can see from the table below, the scheme is an excellent tax free bonus payment if you were intending to work anyway.
|
Pension Bonus Scheme |
(Maximum Bonuses payable from 20 March 2009) | |
|
Years |
Single ($) |
Partnered ($) |
|
1 |
1,392.60 |
1,163.10 |
|
2 |
5,570.40 |
4,652.40 |
|
3 |
12,533.30 |
10,467.90 |
|
4 |
22,281.50 |
18,609.60 |
|
5 |
34,814.80 |
29,077.50 |
Budget09 announced that from 20 September 2009, the Pension Bonus Scheme (PBS) will be closed to new entrants. Individuals who are already registered in the PBS before 20 September 2009 will be able to remain in the scheme, accrue entitlements and claim a pension and their bonus when they finish working.
So what’s the strategy?
If you are already 65, or going to turn 65 between now and 20 September, you should absolutely register with Centrelink for the Pension Bonus Scheme. Now you may or may not choose to work after turning age 65, but if you are not registered in the scheme before 20 Sept, then there is no way you will be able to pick up that nice tax free bonus payment in the event you do decide to keep working.
Gotta be in it to win it!
Any advice given is of a general nature only and has not taken into account your objectives, financial situation or needs. Because of this, before acting on any advice, you should consult a financial planner to consider how appropriate the advice is to your objectives, financial situations and needs.
