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3.10.6 Rate Calculation under the Hardship Provisions

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Rate calculation when hardship provisions apply

To calculate the rate of service pension or income support supplement payable under the hardship provisions, the person's adjusted annual rate of ordinary income is deducted from the maximum payment rate of service pension or income support supplement

Unrealisable financial asset is exempt from the deeming provisions

    

If a financial asset is determined to be unrealisable under s.52Y for the purposes of the hardship provisions, it must be exempted from the deeming provisions.


According to Section 52Z(3) of the VEA a person's adjusted annual rate of ordinary income is an amount per year equal to the sum of:

  • the person's annual rate of ordinary income (other than income from assets), and
  • the person's annual rate of ordinary income from assets that are not assets tested, and
  • either:
  • the person's annual rate of ordinary income from unrealisable assets, or
  • the person's notional rate of ordinary income from unrealisable assets, whichever is the greater, and
  • an amount per year equal to $9.75 for each $250 of the value of the person's assets (other than disregarded assets)

 

 

The maximum payment rate is the amount calculated by adding the maximum basic rate applicable to a person to any rent assistance and pension supplement payable. See SCH6-A1(2) of VEA (Method Statement 1 Step 4) and SCH6-A1(6) of VEA (Method Statement 5 Step 4).