New changes have been passed which require welfare recipients to report income as it appears on a payslip rather than estimating a figure.

Legislation has passed the Senate that change the Centrelink reporting regime, and is expected to save the federal budget $2.1 billion over four years.

Centrelink incomes reports have used estimated figures based on how many hours worked in a fortnight and rate of pay, taking into account penalty rates.

The new system, which will come into place in July, allows welfare recipients to enter the specific details on their payslips.

It should also allow welfare recipients' employment and income data to be pre-filled online, the same as tax returns.

The government says the measures are designed to make Centrelink payments more accurate, so that they can prevent people being owed money or paid too much.

Labor passed amendments to the bill including a one-year review of the new system, so it must now return to the lower house for final approval.