Work bonus
This page explains what the work bonus is, who is eligible for it and how it is calculated.
The rates on this page are effective from 1 July 2026.
Back to topWhat is the work bonus?
The work bonus is an incentive to encourage people who are able, to continue working after they reach qualifying/pension age. Under the work bonus rules, the first $300.00 of wages earned per fortnight will be excluded from the income test.
Back to topWhat is work bonus income?
The following are all considered to be work bonus income if they are earned or received as a result of your work:
- salary
- wages
- commissions
- self-employment income
- employment related fringe benefits
If you own your own business and draw wages from the company, your wages are work bonus income.
Self-employment income will be eligible for the work bonus if the work involves active participation. This is work that involves effort, such as bookkeeping or plumbing. Active participation does not include managing an investment portfolio or an investment property.
If you are unsure whether your income is classed as wok bonus income, contact DVA.
Back to topWho is eligible for the work bonus?
If you receive the Service Pension, Income Support Supplement (ISS) or Social Security Age Pension, all of the following must apply for you to be eligible for the work bonus:
- be over qualifying age for Service Pension or ISS (60 years), or over Social Security Age Pension age (67 years)
- receive work bonus income
- rate of payment must be assessed under the rules that came into force on 20 September 2009.
If you receive an income support payment from Services Australia, they have a similar scheme. For more information on Work Bonus go to the Services Australia website.
Back to topHow does the work bonus apply to couples?
For members of a couple, your combined assessable income affects both of you. Therefore, if one person is eligible for the Work Bonus, you will both benefit from the reduced assessable income.
If both members of a couple receive work bonus income and you are both eligible, you will both receive the bonus.
However, if the working partner is under the required age, the work bonus does not apply, and the earnings will be treated as ordinary income.
Back to topHow is the work bonus calculated?
If you qualify for the work bonus, the first $300 of eligible fortnightly work bonus income will be excluded from your income test. If your payment is currently income tested this will increase the rate payable to you.
Example 1: Harry receives Social Security Age Pension and works for 10 hours per fortnight, earning $350.00. When their income is assessed only $50.00 ($350.00 - $300.00) will be counted as income.
Example 2: Beryl receives Service Pension Partner and is over qualifying age. They work 40 hours per fortnight, earning $1000.00. When their income is assessed only $700.00 will be counted. The way their income is assessed is:
$1000 - $300.00 = $700.00
Example 3: David & Margaret receive Service Pension and are both over qualifying age. David works 30 hours per fortnight, earning $700. Margaret works 5 hours a fortnight and earns $100. The way their income is assessed is:
| David | $700 - $300.00 = $400.00 |
| Margaret | $100.00 - $100.00 = $0.00 |
| Combined | $400.00 + $0.00 = $400.00 |
Their combined assessable employment income is $400.00.
Back to topWhat is the work bonus bank?
If your work bonus income is less than $300 per fortnight, you can accrue the unused amount of the work bonus income concession in a work bonus bank. The difference between $300 and the gross work bonus income each fortnight is credited to your work bonus bank to a maximum of $11,800. The balance in your work bonus bank can then offset your employment income that would otherwise be assessable in the future.
If you are new to the work bonus, then you will receive a credit of $4,000 upon joining the scheme.
If you are a former Work Bonus client rejoining the scheme, then you may be eligible to receive a “top-up” to your work bonus bank balance. You are eligible for the top-up if you have a preserved balance that is less than $4,000 and you have not received a top-up or initial $4,000 joining credit within the previous 2 years. The top-up will increase your Work Bonus Bank balance to $4,000.
Example 1: Accrual
Paul receives Social Security Age Pension and works for 10 hours per fortnight, earning $200.00. When their income is assessed only $200.00 of the work bonus will be used to discount income. The remaining work bonus of $100.00 will be credited to the work bonus bank up to a maximum of $11,800.00.
Example 2: Accrual
David & Margaret receive Service Pension and are both over qualifying age. David works 20 hours per fortnight, earning $700. Margaret works 5 hours a fortnight and earns $100.
| David | $700.00 - $300.00 = $400.00; Assessable income is $400.00; Work Bonus accrual = $0.00; ($300.00 - $300.00 = $0.00) |
| Margaret | $100.00 - $100.00 = $0.00; Assessable income is $0.00; Work bonus accrual = $200.00; ($300.00 - $100.00 = $200.00) |
Example 3: Depletion
John has accrued $1,500 in their work bonus bank. John starts part-time work earning employment income of $400 per fortnight.
| Step 1 | $400.00 - $300.00 = $100.00 (work bonus discount) |
| Step 2 | $100.00 - $100.00 = $0.00 (work bonus bank depletion) |
| Assessable income is $0.00 remaining work bonus bank = $1400.00 ($1,500 - $100.00) |
As John continues with this employment and their income remains at the same level, the work bonus bank credit will gradually reduce. Once the work bonus bank credit runs out after 15 fortnights ($1,500 depleting at $100 per fortnight), John will still have access to the $300 work bonus income concession amount. Their assessable employment income will then be $100 per fortnight ($400 less $300 income concession amount).
Back to topHow do I apply for the work bonus?
You do not need to apply for the work bonus. It will be calculated automatically when your payment is assessed. You do need to make sure that if you have employment earnings they are correctly recorded with DVA.
If you receive income from self-employment, you will need to tell us the percentage of income earned from your active participation.
If you want to check how your income is recorded or that you have received a work bonus in your assessment contact DVA to discuss your case.
Back to topObligations
You have a responsibility to keep us informed of changes that may affect the amount of payment you receive. These responsibilities are described in our letters to you as ‘obligations’, and apply equally to trustees.
In order to meet your obligations, you need to tell DVA within 14 days (28 days if you live overseas or receive remote area allowance) if:
- your residential situation changes
- your relationship status changes
- you receive the maximum rate pension and your income exceeds the ordinary income free area and/or your assets exceed the assets value limit
- you receive a reduced rate pension and your income and/or assets exceed the limits stated in our most recent letter to you about your income support payment
- you move or travel overseas
- there is any other change that would affect the rate of your income support payment.
Fulfilling your obligations within the specified time period assists us in maintaining your correct rate of income support payment.
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