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DVA FACTS
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Last updated: 14 Oct 08
Service Pension and Income Support Supplement
Service Pension Overview
Overview
This fact sheet explains what a
service pension is, what the eligibility criteria are, and provides information
on associated benefits. For more
information on specific topics contact DVA.
Note
For information about changes to partner service pension included in the Federal Budget, please also refer to Fact Sheet IS 45: Partner Service Pension.
What is a service pension?
A service pension provides a
regular income for people with limited means.
A service pension can be paid to veterans on the grounds of age or
invalidity, and to eligible partners, widows and widowers. It is subject to income and assets tests.
The age service pension paid to
veterans who have qualifying service and the partner service pension paid to
eligible partners widows and widowers are paid 5 years earlier than the age
pension paid by Centrelink. Service pension
is paid earlier than age pension in recognition of the intangible effects of
war that may result in premature ageing of the veteran and/or loss of earning
power. However, the invalidity service
pension may be granted at any age up to the age of 65 years.
The service pension is paid
fortnightly, based on daily entitlements.
The rate of service pension is adjusted twice-yearly, in March and
September, in line with movements in the cost of living and/or average wages.
Who is eligible?
A service pension is payable to
eligible veterans, their partners and widows and widowers. For service pension purposes, a veteran is a
person who has qualifying service (see the next section ‘Eligibility for
veterans’). Eligible veterans include:
·
Australian Veterans
·
Commonwealth Veterans
·
Allied Veterans
·
Australian Mariners
·
Allied Mariners
·
Members, Former
Members, Declared Members covered under the Military Rehabilitation and
Compensation Act 2004
(MRCA).
Eligibility for veterans
You
are eligible for the service pension if you are a veteran who:
· has qualifying service — generally, that is, has served in operations against the
enemy while in danger from hostile forces of the enemy; and
·
meets the residency
requirements — that is, is a
resident of Australia and is present in Australia at the time of lodging the
claim for service pension (additionally, Commonwealth Veterans and allied Veterans
and Mariners must have been an Australian resident for at least 10 years,
although there can be some exemptions);
And you are either:
· of service pension age (see the section
titled ‘What is pension age?’ in this fact sheet); or
· permanently
incapacitated for work (for more information refer to Fact
Sheet IS 44: Age and Invalidity Service Pension).
A service pension may not be payable because of your income
and assets, even if you are eligible (see the section titled ‘Income and assets
tests’ in this fact sheet).
Eligibility for current partners
Partner service pension may be
paid to partners who are:
·
legally married to and
living with a veteran; or
·
living in a
marriage-like relationship with a veteran;
and in both cases above, the veteran is receiving or is eligible to receive the service pension.
Eligibility for current partners, continued
Partners are eligible if:
·
they are qualifying
age (see the section titled ‘What is pension age?’ in this fact sheet); or
· they have dependent children; or
·
the veteran receives
the special rate (T&PI)) disability pension; or
· the veteran is receiving, or eligible to receive, a Special
Rate Disability Pension under the MRCA.
For detailed information regarding qualifying age and
eligibility for partner service pension, please refer to Fact
Sheet IS 45: Partner Service Pension.
Eligibility for former partners
Partner service pension may be paid to former partners who are legally married to, but separated from a veteran.
Former partners are eligible if:
· they are qualifying age; or
· they have dependent children;
and in both cases above, the veteran is receiving, or is eligible to receive, the service pension.
A former partner is not eligible to receive partner service pension if they enter into a marriage–like relationship with another person.
Eligibility for widows and widowers
If the widow or widower of a
veteran was receiving partner service pension immediately before the veteran's
death, he or she continues to be eligible for that pension.
There are a number of other
circumstances in which a widow or widower of a veteran who has rendered
qualifying service is eligible for partner service pension. Refer to
Fact Sheet IS 45: Partner Service Pension for details.
What is pension age?
The pension age for a male veteran who has
qualifying service and the qualifying age for a male partner is 60.
Pension age for a female veteran who has qualifying service and
qualifying age for a female are being raised by six months every two years, so
that by 1 January 2014, female and male pension and qualifying ages
will be the same. The table below shows
when females qualify.
|
Female |
|
|
Date of Birth |
Pension/Qualifying
Age |
|
Before 1 July
1949 |
Eligible |
|
1 July 1949 to
31 December 1950 |
58.5 |
|
1 January 1951
to 30 June 1952 |
59 |
|
1 July 1952 to
31 December 1953 |
59.5 |
|
1 January 1954
and later |
60 |
Service pension and age pension
You cannot receive a service
pension from DVA as well as an age
pension or any other social security pension or benefit (except Family Tax
Benefit).
Pension Bonus Scheme
The pension bonus scheme is designed to encourage people to remain in the workforce longer. The scheme offers a bonus to certain veterans, partners, widows and widowers who wish to keep working beyond pension age (qualifying age for a war widow/widower). By registering with the Scheme and then deferring pension for at least a year, you may be eligible to claim a tax-free lump sum bonus at the end of your working life.
To be eligible, all of the following criteria must be met. You must:
·
be eligible to receive
the age pension, age service pension, partner service pension or income support
supplement; and
·
have reached or passed
pension age (qualifying age for a war widow/widower); and
·
have not yet received
or claimed one of the above pensions since turning pension age (qualifying
age for a war widow/widower).
For more information refer
to Fact Sheet IS 07: Pension Bonus Scheme or contact DVA.
How do you claim service pension?
To claim for a service pension
you need to:
· complete the form D0503: Claim for Service Pension Part A – Eligibility, or a D0504: Claim for Service Pension by a Partner, a former partner or Widow or Widower Part A – Eligibility; and
· complete any other forms in relation to your personal, residential and financial circumstances; and
· provide us with sufficient documentation to prove your identity. Refer to Fact Sheet DVA 06: Proving your identity to DVA – Proof of Identity (POI); and
· provide us with your tax file number.
To apply for the service
pension, contact DVA, where an application form will be tailored to suit your
circumstances. Application forms are
also available from some ex-service organisations, such as the RSL. For more details on claiming service pension please
refer to the form D0503/4B: About Claiming Service Pension.
Rates of service pension
There are two different rates
of service pension:
·
a singles
rate — payable to single pensioners, widows,
widowers
·
a couples
rate — payable to each member of a couple who are
living together, whether legally married or living in a de facto relationship.
If only one member of a couple receives a service pension, the couples rate of pension is paid. If a couple need to live apart because of ill-health or during a period of respite care, each member of the couple may be paid at the singles rate.
If you are a veteran and you
also receive a war widow(er)’s pension, the maximum amount of service pension
you are entitled to is limited to $167.80
per fortnight.
Income and assets tests
The amount of service pension
you receive depends on your income and assets.
The pension is calculated under two separate tests, the income test and
the assets test. The test paying the
lower rate of pension is the one that is applied.
You can have a certain amount
of income and assets, and still receive the maximum rate of pension. These limits are known as the ordinary income
free area and the assets value limit.
There are two ordinary income
free areas:
·
the singles income free
area
·
the couples income free
area.
If you have dependent children,
the ordinary income free area increases by $24.60 per fortnight for each dependent
child.
There are four assets value
limits:
·
singles who own their
home
·
singles who do not own
their home
·
couples who own their
home
·
couples who do not own
their home.
Income or assets above the
ordinary income free area or assets value limit reduces the amount of service
pension payable. The service pension
ceases to be paid when income or assets exceed certain cut-off limits.
If you are a member of a
couple, you are both treated as if you each receive half your combined income
and you each own half your combined assets, regardless of who actually receives
the income or owns the assets. Therefore,
you are both paid the same rate of pension.
Note:
For pension purposes, superannuation products are not counted as
income producing or an asset until the person who owns the superannuation reaches
pension age or makes a withdrawal from the investment. For more information about the assessment of
superannuation, refer to Fact Sheet IS 91: Managed Investments.
If you are considered to be
blind, the service pension is paid free of the income and assets tests and at
the maximum rate. For more information
refer to Fact Sheet IS 147: Blind Pensioners.
Giving away assets or income
You can give away assets up to:
$10,000 each financial year; or
· $30,000 over a rolling five-year period.
These limits apply to singles and
couples. If you give away more than either
limit, the excess amount will be counted as an asset
under the assets test, and will be deemed to be earning income under the income
test, for 5 years from when the assets were given away.
If you give away assets above
the limits in the 5 years before your
service pension is granted, the excess amount will be counted as an asset and
will be deemed to be earning income for up to 5 years from when the assets were
given away.
These rules apply when:
·
you give away money or
property
· you transfer money or property to, for example, a family member.
However, these rules do not
apply to the sale or use of assets to meet ordinary or extraordinary expenses
such as ongoing living expenses, unusual medical expenses, a holiday, home
improvements or a new car.
If you choose not to receive
income (for instance, you choose not to receive a foreign pension to which you
are entitled) in order to obtain:
·
a pension; or
·
a higher rate of
pension;
then we will still count that
income as if you were actually receiving it.
What if you have too much income or too many
assets?
If you have a high level of
income or assets that prevents you from receiving the service pension under
either the income or the assets test, you may be able to receive service
pension through the Pension Loans Scheme (for more information refer to Fact
Sheet IS 116: Pension Loans Scheme).
If your income is within the limits that would allow you to
receive payment of the service pension, but your assets exceed the cut-off
limit, you may qualify under the hardship
provisions (for more information refer to Fact Sheet IS 117: Hardship).
What if you have too much income or too many
assets? continued
If you do not qualify for a service pension because of the means tests, you may be eligible for the Commonwealth Seniors Health Card depending on your level of income (for more information refer to Fact Sheet IS 126: Commonwealth Seniors Health Card).
Tax file number
You need to provide your tax
file number to DVA. If you do not have a
tax file number and are not eligible for an exemption you will need to apply
for a tax file number through the Australian Taxation Office.
Allowances
There are a number of
allowances payable to eligible pensioners:
·
pharmaceutical allowance — payable to all service pensioners, to help with the cost
of prescriptions
·
rent assistance
— payable to service pensioners who pay private rent for their accommodation,
subject to minimum rent limits
·
remote area allowance — payable to service pensioners who live in designated
remote areas of
·
telephone allowance — payable to service pensioners who are telephone
subscribers. Veterans eligible under the
MRCA should refer to Fact Sheet MRC 13: Telephone Allowance
· increased
telephone allowance — payable to service
pensioners who are telephone subscribers and also have a home Internet connection
·
utilities allowance — payable
to all service pensioners to help with the payment of energy, rates, water and
sewerage.
Note: DVA does not pay Family Tax Benefit. If you have dependent children you should contact the Family Assistance Office for any enquires about the payment of Family Tax Benefit.
What happens when your claim is decided?
If you are a veteran, DVA will
determine your qualifying service and other eligibility. If you and/or your partner are eligible, DVA will
work out how much service pension you will be receiving, depending on your
income and assets. When a decision has
been made you will be notified by letter.
This will include
What happens when your claim is decided? continued
the date of grant and amount of
service pension you will receive. You
will also be notified of your obligations as a service pensioner. Your Pensioner Concession Card will be issued
at the same time.
DVA will also tell you if you
are eligible for a Gold Card for treatment (see the section ‘Health care’ of
this fact sheet). If you are eligible,
the Gold Card will be posted separately 4–6 weeks later.
What if you are not happy with the decision?
If your claim for a service
pension is not approved, or you are not happy with the rate of the service
pension, you have the right to ask that we review the decision. You may apply to have the decision reviewed
by a Review Officer. If you decide to
apply for a review, you must do so within 3 months of receiving the letter
notifying you of our decision. Your
request for a review must set out in writing your reasons for seeking the review.
If you are dissatisfied with
any aspect of the Review Officer’s decision, you may apply in writing to the Administrative Appeals Tribunal for a review of
that decision. Your application should
set out the reasons for your appeal and should be lodged with the Tribunal
within 3 months of the date you receive the Review Officer’s decision.
Pensioner Concession Card
All service pensioners receive
a Pensioner Concession Card. This card
entitles pensioners to a range of Australian Government, State and local
government benefits and concessions.
These concessions vary from State to State, and are determined by the
authorities providing the concessions. For
more information refer to Fact Sheet IS 125: Pensioner Concession
Card.
Note: If a person is participating in the Pension Loan Scheme to
obtain a substitute for the pension and is not otherwise entitled to a rate of
pension, they are not entitled to the additional benefits associated with
receipt of a pension such as a Pensioner Concession Card.
Health care
DVA issues one of three health
cards to eligible veterans and war widows and widowers, providing health care
at the expense of the Department:
·
the Gold
Card — treatment and
health services for all conditions
·
the White
Card — treatment and health services for specific
conditions only
·
the Orange
Card — pharmaceutical benefits for eligible
Commonwealth and allied veterans and mariners.
Veterans who served with the
Australian Defence Forces may be eligible for the Gold Card when granted the service pension if they:
receive service pension only and have income and assets within certain limits; or
receive any amount of service
pension plus a disability pension of
50% or more of the general rate ; or
·
are permanently blind;
or
·
have an impairment
from one or more service related injuries or diseases that constitutes at least
30 impairment points under MRCA.
Regardless of any service
pension granted, persons may be eligible for the Gold Card if they are:
·
veterans who receive a
disability pension at 100% of the general rate or higher (i.e. Extreme
Disablement Adjustment, Intermediate Rate, T&PI, TTI)
·
veterans receiving an
additional amount for a specific disability
·
veterans granted a
disability pension for pulmonary tuberculosis before
2 November 1978
·
ex-prisoners of war
·
war widows and
widowers
·
World War II
ex-service women with Qualifying Service
·
World War II veterans
and mariners aged 70 and over who served in the Australian Defence Forces and
who have qualifying service from that conflict
·
veterans who have an
impairment from one or more service related injuries or diseases of 60 or more
permanent impairment points under MRCA
·
veterans eligible for
the Special Rate Disability Pension (SRDP) safety net payment under MRCA.
Partners
are not eligible for health care at the expense of the Department.
For more information on eligibility for the Gold Card refer to Fact
Sheet
HSV 59: Eligibility For the Repatriation Health Card — For All Conditions (Gold).
Health care, continued
For more information on using the Gold Card refer to Fact Sheet HSV 60: Using the Repatriation Health Card — For All Conditions (Gold).
For more information on the White Card refer to Fact Sheet HSV 61: Repatriation Health Card – for Specific Conditions (White).
For more information on the Orange Card refer to Fact
Sheet HSV 69: Repatriation Pharmaceutical Benefits Card (
Is your service pension taxable?
Most service pensions are considered
income for taxation purposes and are therefore taxable. However, a service pension granted on the
grounds of invalidity is not a taxable pension until the person reaches social
security age pension age. The partner
service pension, received by the partner of an invalidity service pensioner, is
also non-taxable until the veteran or the partner reaches age pension age. Partner service pension paid to a former
partner is taxable.
If your pension is taxable, you
will receive a Payment Summary (previously called a group certificate) from DVA
at the end of each financial year. Generally speaking, if the service pension
is the only income you receive, you will not have to lodge a tax return.
Service pension allowances are
not taxable payments. Disability pension
and allowances and war widow’s pension are not taxable payments.
Your obligations
As a service pensioner you have
a responsibility to keep us informed of changes that may affect the amount of
pension you receive. These
responsibilities are described in our fact sheets and letters to you as
‘obligations’.
In order to meet your
obligations, you need to tell DVA within 14 days (28 days if you live overseas
or receive remote area allowance) if:
·
your residential
situation changes
·
your marital situation
changes
·
you receive the
maximum rate pension and your income exceeds the ordinary income free area
and/or your assets exceed the assets value limit
Your obligations, continued
·
you receive a reduced
rate pension and your income and/or assets exceed the limits stated in our most
recent letter to you about your service pension
·
you move or travel
overseas
·
there is any other
change that would affect the rate of your service pension.
Fulfilling your obligations
within the specified time period assists us in maintaining your correct rate of
service pension.
Can you apply for an increase in your service
pension?
Yes. If you receive a reduced rate pension, you may apply for an increase in your rate of pension at any time there is a change in your circumstances. You can do this by contacting us by phone, in writing or in person.
Financial information
We can provide information on how your particular financial circumstances, or future financial decisions, might affect your service pension. To arrange an appointment contact DVA.
Centrelink Financial Information Service
Centrelink runs a dedicated Financial Information Service (FIS) which is also free to DVA pensioners. This service provides confidential independent information about financial investments - for example, what is available, analysis of investment products, taxation implications and general information on financial planning. FIS Officers provide information to people over the telephone, at personal interviews, or through financial seminars. They do not recommend any particular type(s) of investment, prepare financial plans or give financial advice.
For more information:
Centrelink FIS 132 300
Arranging your affairs
It is advisable to keep all
your important papers, such as wills, birth certificates, and mortgage papers,
in a safe place known to family and friends.
A folder containing information to assist you in arranging your affairs,
called Planning Ahead — A Guide to Putting Your Affairs in Order, is available from DVA or ex-service organisations such as
the RSL or Legacy.
Bereavement payments
Additional financial
assistance, in the form of a bereavement payment and/or a funeral benefit, may
be provided.
Veterans and their families
eligible under the Veterans’ Entitlements Act 1986 (VEA) should refer to the following fact sheets for future
information:
·
BR 01:
Funeral Benefits
·
BR 02:
Payments after Bereavement.
Veterans eligible under MRCA
should also refer to Fact
Sheet MRC 18: Bereavement Payments.
Freedom of information
Under the Freedom of Information Act 1982 you may seek access to information about yourself. This means that you can look at your personal
files held by DVA and ask for copies of documents.
You need to apply in writing
and there is an application fee of $30.00. However, the fee does not apply if the
documents you need relate to claims for, or increases in, your pension.
Privacy
The Privacy Act 1988 governs the
collection and handling of personal information by Australian Government
agencies, including DVA, and the process is overseen by the Privacy
Commissioner to ensure the rights of individuals are protected.
Oral advice
While we make every effort to
ensure that you are given accurate information, it is important that you seek
written confirmation of oral information or advice before making any major
decisions based on that information.
We continually strive to
improve the level of service you receive and make this request as an added
safeguard for you.
Other fact sheets
Other fact sheets related to
this topic include:
·
Age
and Invalidity Service Pension: IS 44
·
Partner
Service Pension: IS 45
·
Income
Support Supplement: IS 46