According to the Currency Act 1965 (section 16) Australian coins are legal tender for payment,
as long as they
- do not exceed $5 of any combination of 5 cent, 10 cent, 20 cent and 50 cent coins are offered. That means for example, you can only use 100 single 5 cent pieces in a transaction.
- do not exceed 10 times the face value of the coin if $1 or $2 coins are offered. That means, you can only use 10 $1 coins, or $2 coins for a transaction.
What does that mean?
It means if someone wants to pay with 5-cent coins, they can be told they can only pay up to $5 worth — with any more than that not deemed legal tender.
However, that is at the discretion of the person being paid. If they are happy to accept payment of $100 in 5-cent pieces, there is no problem.
What about the old copper 1 cent and 2 cent pieces I hear you ask?
And yes, 1-cent and 2-cent pieces are still Australian legal tender, but they are not considered as "currency" (or, money that is officially released for circulation).
Well, if you still have them, then they too are still legal tender, despite being withdrawn from circulation in 1992, but they cannot exceed 20 cents. In other words, you can only use 20 1 cent pieces for a transaction.
But what if your coins are damaged?
Damaged currency is invalid, but, the Royal Australian Mint says that if you have damaged or worn coins, you can deposit them with your bank for full face value.
If the coins however, are mutilated, then your bank will require you to complete a Mutilated Coin Claim Form. This only really happens when there are a substantial number of coins significantly damaged, because the Mint will only pay scrap value, and not the full face value of the deposit.
How many old coins are still around?
About 2.4 billion coins were minted between 1910, when a national Australian currency was formed, and 1964 — two years before the switch to the coins we recognise today.
The Reserve Bank of Australia keeps records about the circulation of banknotes, however it is unclear how many of those early coins are still around, as it is likely some were melted down to be reused.
