Youth Allowance Guide:
How Much Can You Earn Before Centrelink Cuts Your Payment?
For many young Australians, particularly students and apprentices, Youth Allowance is a critical source of financial support. It helps cover living costs while you study or train, but it’s essential to understand how your own income can affect your payment. If you have a part-time job, you might be wondering: how much can I earn before Centrelink starts reducing my Youth Allowance? This guide will explain the personal income test and how it works.
What is the Personal Income Test?
Centrelink uses a personal income test to determine how much Youth Allowance you are eligible to receive. This test looks at your gross income—that is, your income before tax is deducted—over a fortnightly period 1. If your income goes over a certain threshold, your payment will be reduced. It’s essential to report your income accurately every fortnight to ensure you are paid correctly and avoid any debts.
The “Income Free Area”
For students and apprentices receiving Youth Allowance, you can earn up to $528 per fortnight before your payment is affected 1. This is known as the “income-free area.” Any income you earn up to this amount will not change your Youth Allowance payment.
If you earn less than $528 in a fortnight, you can accumulate the unused portion in what Centrelink calls an “Income Bank.” For example, if you earn $300 in one fortnight, the remaining $228 is added to your Income Bank. You can then use these credits in a later fortnight when you earn more than $528, allowing you to keep more of your payment.
How Your Payment is Reduced
Once your fortnightly income exceeds the $528 threshold, your Youth Allowance payment will begin to decrease. The reduction happens in two stages 1:
1.For every dollar you earn between $528 and $633 per fortnight, your payment is reduced by 50 cents.
2.For every dollar you earn above $633 per fortnight, your payment is reduced by 60 cents.
Let’s look at an example. If you are a single student living at home and earn $700 in a fortnight, your payment would be reduced as follows:
- First, the income between $528 and $633 ($105) reduces your payment by $52.50 ($105 x $0.50).
- Next, income over $633 ($67) reduces your payment by an additional $40.20 (67 x $0.60).
- Your total reduction for that fortnight would be $92.70.
When Does Your Payment Stop Completely?
There is a point at which your income will be high enough to reduce your Youth Allowance payment to zero. This is known as the “cut-off point,” and it varies depending on your personal circumstances, such as whether you live at home or have children.
The table below shows the approximate fortnightly income at which your Youth Allowance payment will stop completely, based on the rates as of January 2025 1.
| Your Situation | Maximum Income Before Payment Stops |
| Single, under 18, living at home | $1,235.84 per fortnight |
| Single, 18 or over, living at home | $1,340.67 per fortnight |
| Single, living away from home | $1,662.67 per fortnight |
| Member of a couple with children | $1,755.17 per fortnight |
| Single with children | $1,955.17 per fortnight |
If your payment is reduced to zero for 12 consecutive fortnights due to your income, your Youth Allowance will be cancelled, and you will need to reapply if your income decreases again 1.
Other Factors That Can Affect Your Payment
It’s important to remember that the personal income test is not the only thing that can affect your Youth Allowance. Centrelink also considers 1:
The Parental Income Test: If you are considered a dependent, your parents’ income can affect your payment rate. For the 2025-26 financial year, your payment starts to reduce if your parents’ combined income exceeds $65,189.
The Personal Assets Test: The value of your assets, such as savings or a car, can also impact your eligibility.
The Partner Income Test: If you have a partner, their income will also be taken into account.
Tips for Managing Youth Allowance and Work
Understanding how the income test works can help you make informed decisions about how many hours to work. Here are some practical tips:
Report Your Income Accurately: Always report your income on time and accurately. Underreporting can lead to overpayments, which you’ll have to pay back later.
Use Your Income Bank: If you have weeks where you earn less than $528, those credits build up in your Income Bank. You can use them during a busy fortnight to reduce the impact on your payment.
Plan Your Work Hours: If you’re close to the cut-off point, consider whether the extra income from additional shifts is worth the reduction in your Youth Allowance payment.
By understanding these rules, you can better manage your work and finances while receiving Youth Allowance. Always keep your Centrelink details up to date to avoid payment issues.
Disclaimer: This article provides general information and does not constitute financial advice. Please consult with a professional for advice tailored to your specific circumstances. Information is current as of November 2025.