All about gifting rules

Super 101 | Date Posted 18 May 2022

Is there a better feeling than the joy of giving? Being able to help out the kids or grandkids financially can be wonderful. But if you receive an Age Pension, have you thought about any potential strings attached in helping them buy their first car, getting on the property ladder, or paying for their education? In this article we’ll look at what is and what isn’t considered gifting, how much you can give and how it could impact your Age Pension.


Australia doesn't have a tax on gifting, however for retirees receiving Centrelink benefits, the value of any assets they give away may still count towards their assets test and income test.

What is gifting?

The Government considers it gifting when you either give away assets or transfer them for less than their market value. The below are all examples of gifting:

  • Buying a car for your children as a present;

  • Donating a percentage of your wages to your church;

  • Writing off a debt; or 

  • Paying school fees for grandchildren.


For example, if you own a house valued at $780,000 and sell it on the open market for $750,000 because that was the best offer you could get, it’s not considered gifting. However, if you sold that house to your son for only $600,000, the difference would be considered a gift, and may still count towards your assets test and income test.

What are the limits?

There’s no limit on how much you can give away, but to prevent people giving away assets to increase their Age Pension payments, there’s a limit on how much you can give away without it affecting your Age Pension. The amount you can gift each year is called your allowable disposal amount or gifting free area. This is the most you can give without affecting your Age Pension payments. Individuals and couples combined can gift up to $10,000 in one financial year (or $30,000 over five years). Any gifts over $10,000 in any financial year (or $30,000 over five years) will continue to be counted for the assets and income test for five years from the date of the gift. 

Can gifting increase my Age Pension

If you gift more than $10,000 then after five years, the excess amounts are no longer counted by Centrelink as your assets, which could result in an increase in your Age Pension at that point, depending on other factors at the time. 


In addition, if you’re a part Age Pensioner, you could use gifting to reduce your assets and receive a slightly higher Age Pension payment. However, it will depend on your personal circumstances and you’ll need to stay below the allowable amounts, so it may be worthwhile discussing this strategy with your financial adviser first. 

Consider the long-term impact

If you can afford to financially help out, gifting can be helpful for the recipient and rewarding to you. However, make sure you consider the impact it will have on your own financial security down the track.

Turn to Mine

Not sure if gifting is right for you? Check out the Department of Human Services for more information, or seek financial advice. Advisers from Mine Super Financial Advice are ready to help, and as a member, your initial consultation is free.