How does Centrelink check your assets? November 18th, 2022
Centrelink has mechanisms to check your assets and it does so to assess the validity and eligibility of a variety of claims. Importantly for pensioners, the asset test is one test used by Centrelink to assess your eligibility for a part or full pension.
So how exactly does Centrelink check your assets? We explain that data sharing/matching process below.
Centrelink is interested in a wide variety of assets, including but not limited to:
- Financial investments
- Home contents, personal effects, vehicles and other personal assets
- Managed investments and superannuation
- Real estate
- Annuities, income streams and superannuation pensions
- Shares
How Centrelink knows your assets without you telling them
Centrelink has multiple data-sharing agreements with government organisations like the ATO, Medicare, PayG and more. This helps them to maintain a view of your assets, and in certain circumstances they may apply additional scrutiny to individuals. The image below shows the steps that Centrelink goes through to match these data points.
What is a data sharing agreement / data matching program
A data sharing agreement is effectively a way for Centrelink and Services Australia to automatically and in-bulk compare the financial information provided by you between multiple departments. So if the ATO knows about your investments (because you provided a TFN to your broker), Centrelink also knows about those investments. It does this very effectively and has processes in place to validate and ensure Tax File Numbers are legitimate.
Centrelink reports on these data matching processes and provides a summary of these processes in their annual reports as an appendix. In 2021-2022, you can read appendix D in this report to get more detail on how it works.
Why Centrelink has a data matching program
Centrelink performs a cost/benefit analysis each year which they explain in their annual reports. They explain that in 2021 the net benefits of this program was $5,384,000, so you can understand why they (and Australian tax payers) continue to operate this program. It helps to ensure people are operating within the rules and that tax dollars are reaching the right people.
Financial investments and when they reassess their value
For most financial investments, Centrelink reassesses the value automatically twice a year, they do this on the 20th of March and 20th of September. If you're receiving a part-pension or you're on the edge of being able to receive a part-pension, and the value of these investments falls, you can voluntarily update Centrelink by calling them.