Pension Bonus Top-up Payment (PBTP) 065-07010040

A customer who has received a Pension Bonus payment may be entitled to a PBTP if:

• their Age Pension rate increases within the 13 weeks after the start day of Age Pension, and
• the increase is due to a reduction in the assessment of their income or assets

The PBTP was implemented for all Age Pension customers granted with a start date on or after 1 January 2008.

PBTP is a tax-free payment. The PBTP is not a second bonus payment, it is a recalculation of the original bonus amount. Note: the PBTP does not apply to Pension Bonus Bereavement Payment.

A customer does not qualify for a top-up payment if the increase in Age Pension rate was solely due to a Consumer Price Index (CPI) change to the maximum rate of pension or a CPI change to the income and assets limits or a change to the amount of Direct Deduction assessed.

The Pension Bonus Scheme is closed to new registrations from 1 July 2014

As part of the Government's Secure and Sustainable Pension Reforms, the PBS closed to new entrants who did not qualify for Age Pension before 20 September 2009.

All existing members may remain in the scheme and claim their Pension Bonus Payments in due course, in line with existing arrangements. The closure of the scheme does not affect an existing customer's entitlement to a PBTP.

All manual PBTP calculations are to be undertaken by the seniors processing centre (PCT).

The Pension Bonus Payment (PBP) is calculated based on the rate of Age Pension on the start day when granted. For a top-up qualifying event, there must have been a reduction in the assessed value of the person's income/assets which caused an increase in pension rate within the 13 weeks after the start day of Age Pension.

The customer may be entitled to a higher bonus payment using the new rate. The system automatically determines if the customer may be entitled to a PBTP. The assessment is generally done at week 16.

The customer does not need to apply for the PBTP. In most cases, the system will complete the assessment and notify the customer. No rejection letter issues when the customer is not entitled to the PBTP if the assessment is part of the automatic review.

If a customer wants to apply for a formal review about not receiving a PBTP, they should apply for a formal review of the original amount of PBP paid.

PBTP is not subject to income management.

The automatic PBTP may be paid at week 16 if a customer or their partner is paid employment income for longer than one entitlement period (LOP) and it is assessed for 13 weeks or more. Refer these cases to the retirements helpdesk when processing the claim.

For PBTP purposes, a qualifying event occurs when a customer's rate of Age Pension increases because of a decrease in Centrelink's assessment of a customer's income and assets which can be due to:

• a decrease in the customer's income and/or assets as notified by the customer
• a change in the exchange rate used to assess the customer's foreign income
• a change in the deeming rate used to assess a customer's financial investments
• a change in the deeming thresholds at which the different deeming rates are applied

A qualifying event does not occur when a change of Age Pension rate is solely due to the following events:

• CPI changes to the rate of payment or other regular non means tested changes (for example, changes to allowable income and assets thresholds or child free thresholds)
• Change to direct deduction amounts, and/or
• change in marital status

A customer whose Age Pension rate increases only because of these reasons is not qualified for a PBTP.

If the customer's original PBP is underpaid due to error, for example income or assets incorrectly reported or coded, the error should be corrected however, the customer will have to wait until 16 weeks from the start day of Age Pension to receive the PBTP automatically. An interim manual top-up cannot be paid.

If a customer is subject to reporting requirements, a top-up should not be paid in respect of a period for which reporting requirements have not yet been fulfilled.

If the customer's payment is suspended at week 16 when the PBTP would have been calculated no assessment will be made. The top-up payment is to be made automatically at the next available opportunity, for example:

• if the record is restored, the top-up is calculated when payment is restored
• if the record is cancelled, the top-up is calculated automatically via the cancellation process

If the customer's payment is cancelled within the 13 weeks after the start day or the customer dies within the 13 weeks after grant of Age Pension the PBTP assessment will be triggered immediately.

A manual calculation will be required if:

• the customer has a change in marital status within the 13 week period after the start day of Age Pension and their rate is affected by a reduction in their income or assets
• a customer has previously received a PBTP but has since had a reassessment backdated to a date that falls within the 13 week period following the start day of pension. A second PBTP can be paid even though arrears of Age Pension may not be payable

There is no overpayment assessed against the PBP if the customer's rate should go down in the initial 13 week period after the start day of Age Pension (providing the reduction was not due to a misrepresentation of circumstances applicable at grant).