What is deeming?
Deeming is the rule Services Australia uses to work out income from your financial assets. Instead of counting the actual interest or dividends your money earns, deeming assumes your financial assets earn a set rate. That assumed income is called deemed income.
Financial assets include things like bank accounts, term deposits, shares and managed funds. Deeming uses two rates: a lower rate on the first part of your financial assets, up to a threshold, and a higher rate on anything above the threshold. The single threshold is $66,800. The deeming rates effective 20 September 2026 are 1.75% on assets up to the threshold and 3.75% above it.
Deeming means it does not matter whether your money is earning a lot or a little. Everyone's financial assets are treated the same way, which keeps the income test simple and stops people being paid more just because they keep their money somewhere with a low return.
How it affects your payment
Deeming is used in the income test for pension payments like the Age Pension, Disability Support Pension and Carer Payment, and for allowances. Your deemed income is added to any other income, such as wages or a private pension, to work out your total assessable income.
Because deeming sets the income from your savings, moving money between a term deposit and a share fund does not change your deemed income. This matters most for pensioners whose payment is worked out under the income test.
Example
Say a single pensioner has some money in the bank. The first slice of those financial assets, up to the single threshold, is deemed to earn the lower rate, and anything above the threshold is deemed to earn the higher rate. Those two amounts are added together to give the deemed income that goes into the income test, no matter what interest the bank actually pays.
Deemed income at three levels of savings
| Financial assets | Single, per year | Single, per fortnight | Couple, per year | Couple, per fortnight |
|---|---|---|---|---|
| $50,000 | $875 | $33.65 | $875 | $33.65 |
| $100,000 | $2,414 | $92.85 | $1,750 | $67.31 |
| $250,000 | $8,039 | $309.19 | $7,163 | $275.50 |
Rates effective 20 September 2026. Per fortnight is the yearly figure divided by 26.
- $250,000 of financial assets is deemed to earn $8,039 a year for a single person, $7,164 more than $50,000 earns.
- At $250,000 a couple's deemed income is $7,163, $876 lower than a single person's, because more of it sits under the higher couple threshold of $110,600.
Related terms
Figures include every indexation up to 20 September 2026; each shows the date it took effect. Next scheduled indexation 1 January 2027. Source: DSS / Services Australia. Last checked 23 September 2026.