Urgent warning to Centrelink recipients ahead of $150million Powerball draw

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There is an urgent warning to Aussies receiving Centrelink payments to be aware of a hidden loophole ahead of Powerball's multi-million dollar draw.

Powerball has jackpotted to a whopping $150million for Thursday night's draw after no-one claimed the top-prize for the last six weeks.

But The Lott wants Centrelink recipients to be aware of a little-known rule if they were to win one of the major prizes.

The Lott has warned recipients of Centrelink benefits that their payments may be affected with a substantial win - even if they were to give the money away

A will be included in an asset test and can affect many benefits, such as Austudy and the Age Pension

If a person on Centrelink is lucky enough to win any of the substantial prizes across the divisions, it can affect their ability to receive benefits in the future.

The rule remains in place even if the Centrelink winner gives all their prize money away to friends and family, reported 7 News.

The Lott has advised any winners who get Centrelink benefits should obtain advice from a financial advisor or Services Australia as soon as they receive their prize.

'If you currently receive a social security benefit, your prize may affect your entitlement,' it said.

'This will depend on the amount of your prize and the current value of your assets. Giving your prize away may also affect your social security benefits, so we encourage you to get financial advice and check with Centrelink.'

Services Australia says lump sums - or a one-off money payment - can be included in a recipient's income test and 'may affect your payment from us'.

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Lump sums can also affect other benefits, such as the Age pension and Austudy.

All prizes won through entries with Golden Casket, NSW Lotteries, Tatts, Tatts NT and SA Lotteries are considered tax-free income in Australia.

But The Lott also has another caution for ticket purchasers concerning tax - another loophole gamblers may not be aware of.

'Once your prize is in a bank account, any interest earned on your prize is subject to income tax for both you and any gift recipients,' it said.

'We strongly suggest seeking professional financial advice for major lottery wins to ensure you receive the maximum benefit from your good fortune.'