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Disability income rent test

The disability income rent test is the method of calculating the amount by which a pensioner's rent assistance is reduced because of the disability income paid to them or their patner. The amount calculated is the RA reduction amount.

RA reduction amount = disability incomerent assistance free areaX taper rate

Note: The rent assistance free area and taper rate are identical to those that normally apply to the person's [glossary:income support payment:DEF/Income support payment] and family situation.

 

 

For [glossary:service pension:DEF/Service pension/er/SP] recipients, disability income when calculating the rent assistance reduction amount (as set out in the table in [glossary:SCH6-C13 of the VEA) refers to:

  • disability pension (as defined by section 5Q(1) of the VEA) including disability pension paid by foreign governments; and
  • weekly permanent impairment compensation payments made under section 68, 71 or 75 of the Military Rehabilitation and Compensation Act 2004; and
  • weekly amounts a person would have been paid if the person had not instead received permanent impairment compensation under section 68, 71 or 75 of the Military Rehabilitation and Compensation Act 2004 as a lump sum.

For ISS recipients, disability income when calculating the rent assistance reduction amount (as set out in the table in SCH6-C14B of the VEA) has the same meaning as adjusted disability pension.

 

A person's 'partner' is someone who is a member of a couple with that person.

For [glossary:service pension:DEF/Service pension/er/SP] recipients, disability income when calculating the rent assistance reduction amount (as set out in the table in [glossary:SCH6-C13 of the VEA) refers to:

  • disability pension (as defined by section 5Q(1) of the VEA) including disability pension paid by foreign governments; and
  • weekly permanent impairment compensation payments made under section 68, 71 or 75 of the Military Rehabilitation and Compensation Act 2004; and
  • weekly amounts a person would have been paid if the person had not instead received permanent impairment compensation under section 68, 71 or 75 of the Military Rehabilitation and Compensation Act 2004 as a lump sum.

For ISS recipients, disability income when calculating the rent assistance reduction amount (as set out in the table in SCH6-C14B of the VEA) has the same meaning as adjusted disability pension.

 

The rent assistance free area is the amount of disability income an income support pensioner may receive without suffering any reduction in rent assistance under the disability income rent test. The rent assistance free area applicable to a person is identical to the income free area the person receives as an income support pensioner and is determined by their family situation.

 

 

The taper rate is used to reduce the rate of a person's service pension or income support supplement if they or their partner have any ordinary income in excess of the ordinary/adjusted income free area (IFA). Any income in excess of the IFA will reduce the maximum payment rate by a 'taper rate' of 50 cents in the dollar (or 40 cents for transitional rate of pension). The result is the income reduced rate.

The same taper rate is also used in disability income rent test calculations to determine the amount of rent assistance for service pensioners and income support supplement recipients.

In addition to the income test taper, any assets in excess of the assets value limit will reduce the maximum payment rate per fortnight by 37.5 cents for every $250 over the Asset Value Limit. The result is the assets reduced rate

 

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