Deeming rates are used to assess income from financial investments for social security purposes. They assume a certain rate of return on investments regardless of the actual income earned. The income deemed from financial investments is taken into account when determining eligibility for the Low Income Health Care Card and other government benefits.
The deeming rates for the Low Income Health Care Card (LIHCC) in Australia were as follows:
- For the first $56,400 of one’s financial assets (for singles), 0.25% is applied. Anything over $56,400 is deemed to earn 2.25%.
- Where you are a couple and at least one of you gets a pension, then the first $93,600 of your combined financial assets has the deemed rate of 0.25% applied. Anything over $93,600 is deemed to earn 2.25%.
- Where you are a couple and at neither one of you gets a pension, then the first $46,800 of each of your own and your share of joint financial assets has a deemed income of 0.25% per year. Anything over $46,800 is deemed to earn 2.25%.
If your investment return is higher than the deemed rates, the extra amount doesn’t count as your income.
If you sell your principal home, sale proceeds may be assessed as deemed income.
It’s important to note that deeming rates can change over time as they are periodically reviewed by the government. It is recommended to check the official website of the Australian Government Department of Human Services or contact Centrelink for the most up-to-date information on deeming rates for the Low Income Health Care Card or other concession cards.