Calculating a Pension Bonus 065-07030010

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

All existing members may remain in the scheme and claim their Pension Bonus in due course, in line with existing arrangements.

From 20 September 2009, the Pension Bonus Payment is calculated using the components of Basic Pension rate and a payment called the Pension Supplement Component for Pension Bonus (PSCPB).

The formula used to calculate the bonus payable reflects the amount of Age Pension the customer is entitled to at the start day (date of grant), and the length of the deferment period. If the customer's marital status changes during the deferment period, a separate formula is used to take account of the proportions of the bonus accrued while the customer was single and partnered.

If the customer has more than 5 bonus periods accrued, the last 5 full year bonus periods are used to calculate the bonus, and it is the marital status during those periods which is taken into account.

Service Officers must recommend to the customer that they contact a FIS Officer before they lodge their claim for Pension Bonus Scheme and Age Pension. If the customer has submitted a claim, Service Officers should still recommend a FIS appointment.

Maximising a customer's entitlement to PBS may depend on various factors. The date a customer finishes work may not be the same as the date their bonus period ends.

A customer may disadvantage themselves by lodging a claim:

• too early, for example before they get their last employment payment, or
• too late, for example more than 13 weeks after they finished work

A FIS contact will determine the best time for the customer to lodge their PBS claim taking into consideration their individual circumstances.

If a customer has claimed, consider if the Age Pension start date can be moved to allow Age Pension and PBP to be paid if:

• they or their partner were paid employment income for longer than one entitlement period (LOP), and
• the LOP payment will preclude Age Pension

Refer the claim to the Retirements Helpdesk if the Age Pension start date cannot be moved far enough, or if a Pension Bonus will be paid but the LOP payment will be assessed for 13 weeks or more after the start date.

If the customer has applied for an exemption from the income and assets tests for their superannuation investment the amount of the Pension Bonus will still be calculated on their rate of Age Pension at the start day (date of grant). If the application is successful, then a Pension Bonus Top-up may be payable. A Top-up will only be payable if the date of effect of the superannuation exemption is no later than the end date of the Pension Bonus Top-up period.

If no Pension Bonus was payable due to the initial assessment of a superannuation investment that is later exempted from the Age Pension start day, reconsider the original decision based on the revised income and asset assessment.

The Pension Bonus Bereavement Payment (PBBP) is based on the amount of Pension Bonus that would have been payable had the deceased customer claimed Age Pension and the Bonus just before their death. Employment income and regular or lump sum compensation payments are not assessed when calculating the PBBP under the income test.