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Income Received to Cover Expenses
Last amended: 21 September 2009
Allowances paid by employers
Payment of an allowance from an employer for reimbursement of work-related expenses is an allowable reduction in a pensioner's income and is not included in the assessment of their assessable income. This includes, for example, allowances paid:
- for travelling, clothing, telephone or meals,
- to people such as mayors, aldermen, council members and Justices of the Peace for out of pocket expenses, and
- to ministers of religion for out-of-pocket expenses associated with their ministry.
If the employer pays more than the expense amount actually incurred by the pensioner, the extra is included in the income assessment.
Basis for exemption
“Allowances” or “work-related expenses” are not defined within the VEA and there is no specific reference that these amounts are to be disregarded. The basis for excluding these payments from the income test is that they do not satisfy the meaning of income, being an amount earned, received or derived by a person for their own use or benefit. While the allowance amounts are received, they represent reimbursement for expenses incurred and so are not available for the pensioner's use or benefit for any other purpose.
Allowances paid to an employee for reimbursement of work-related expenses are not included in the pension assessment for work bonus purposes. Care must therefore be taken to ensure that such allowances are not regarded as employment income and included in the income concession calculations where a person is eligible to receive a work bonus.
Where allowance payments for work-related expenses are not separately identified within payslips or other proof of earnings, delegates should use other available sources of information to satisfy themselves that payments have been directed towards expenses. This might include tax return information, vehicle running sheets, telephone accounts and similar documents.
Payments for jury attendance or court appearances
Payments for out-of-pocket expenses for jury attendance or service, or court appearances by a witness, other than an expert witness, are not treated as income for DVA purposes.
Payments to jurors or expert witnesses for special skills or knowledge are treated as income if they are:
- a wage or fee, or
- payments to cover wages or salary lost during the court sitting.
The Department of Veterans' Affairs.