Are you getting the government concessions you're entitled to? Nick Bruining makes it easy.
Many Australians, particularly self-funded retirees, may be missing out on savings of thousands of dollars a year by being oblivious of the benefits offered by concession cards. In some cases, the discounts are available to couples earning up to $100,000 a year.
And far from applying to discretionary spending, the benefits often apply to the necessities of living.
The concession card system is administered by both state and Commonwealth governments and the different cards provide varying levels of discount.
Concession cards provided by the Commonwealth are administered through Centrelink, with three types issued: health care cards, Commonwealth seniors health cards and pension concession cards.
For those on any form of allowance, including Newstart, Partner or Widow,
the yellow and purple health care card is issued automatically. It is also issued to those families receiving the maximum rate of family tax benefit part A through fortnightly instalments.
Apart from capping the amount payable at $3.70 on pharmaceutical benefit scheme (PBS) listed prescriptions, the health care card can also provide access to further discounts on transport, education, postal redirection and dental services.
TAFE NSW, for example, usually exempts health care cardholders from the TAFE administration charge.
Many people will not be aware that the health care card can also be issued to low income earners who do not receive a Centrelink allowance. It could apply to part-time workers, some students or those on a modest wage, but it might also apply to those who have recently accepted a redundancy or are just starting out in business.
In this case, the card is issued to those whose income is less than $332 a week (or, for couples, $553 a week). Each dependent child raises the threshold by $34 a week. Once granted, your income can increase by up to 25 per cent before the card is cancelled.
The green Commonwealth seniors health card (CSHC) is issued to those who are over pension age - currently 65 for males and 62 for females - whose taxable income falls under the thresholds of $50,000 for singles and $80,000 for couples. The limit is increased to $100,000 for couples if you've been separated by illness. Importantly, no asset test applies to the CSHC.
The CSHC provides discounts only on prescription medicines, but the system also provides a cap on the total amount you need to pay each year on PBS prescription drugs. Currently the limit is $192.40 a year. Given the increasing range and costs of drugs on the PBS list, this alone could save you thousands.
The mauve pensioner concession card (PCC) is issued to anyone receiving a pension, as opposed to an allowance, and for those aged 60 or more who have received an allowance for nine months or more.
It provides the same medical concessions as the CSHC, but the PCC will also generally provide you with access to the same rebates enjoyed by health care cardholders on utilities such as energy and water.
Holding the PCC will usually entitle you to free ambulance transport if required.
Importantly, further rebates are offered on local government rates. In NSW, a rebate of up to 50 per cent, with a maximum of $250, can apply to local government rates and charges.
The rebate amount is apportioned if, say, only one member of a couple holds the PCC, and the discount will vary between councils. A further concession of $112 a year applies to energy supply such as power and gas.
State seniors cards are issued by the NSW Government and provide discounts on services and goods. They are available to those NSW residents aged 60 or more who work less than 20 hours a week. The discounts are typically not less than 5 per cent.
Discounts also apply to public transport and vary depending on the length of the journey and the form of transport used. Application forms can be obtained through most post offices or by calling 1300 364 758.
Nick Bruining is a certified financial planner and a board member of the Financial Planning Association.
