Article 10.5 describes the method Australia will use to calculate the benefit amount of people in Australia who qualify as a result of this Agreement. It is the same as the national law method except in the case of claimants who receive a U.S. Social Security benefit. In that case, the U.S. benefit will not be treated like other income for the purpose of applying the Australian income test, but will instead be deducted in full from the maximum rate Australian benefit. The remaining amount will then be subject to further reduction if the beneficiary has other income (not counting the U.S. benefit) that exceeds the allowable income-test limit. Any excess income will be treated in the same manner as under national law, i.e., 40 percent of the excess will be deducted from the remaining amount to determine the benefit payable.
