Recent news articles have floated the idea some retirees might try to sidestep the government’s new minimum capital gains tax (CGT) by qualifying for as little as A$1 of the age pension.

That’s because under the government’s proposed tax reforms, people on certain income support payments, including the age pension, would be exempt from the new 30% minimum tax on capital gains.

The reforms are now under scrutiny in the Senate. If passed, from July 1 2027, they would mean pensioners in receipt of support payments would continue to have capital gains taxed at their marginal rate – which for some people would be lower than 30%.

The question then becomes: could retirees restructure their affairs, qualify for a pension and avoid the new tax? Or is this another example of a technically possible strategy that’s unlikely to be practical in the real world?

How hard is it to qualify for the pension?

The age pension is subject to both income and assets tests. Collectively, these are known as “means tests”.

There are different thresholds for singles and couples in different circumstances. But broadly speaking, the more assets you own or income you have, the less pension you receive until the payment cuts out altogether.

This creates an immediate problem for many pensioners who may have hoped to use this new “capital gains” minimum tax exemption. A........

© The Conversation