5.12.4 Administration of Pension Supplement

Last amended: 1 July 2010

No need to apply

A pensioner does not need to apply for pension supplement (PSup). If they are eligible, the allowance will be paid automatically to the same payment destination as their income support pension.

Rates

The annual rate — s of pension supplement, minimum pension supplement amount and pension supplement basic amount are calculated as percentages of the combined couples rate.  The percentages are:

The daily rate of pension supplement is calculated by dividing the annual rate by 364.

Payment

Pension supplement is paid fortnightly on pension pay day.  They may also elect to [glossary:defer a portion of the fortnightly amount and have it paid:] quarterly.

Quarterly election

Pensioners may elect to receive the minimum pension supplement amount quarterly, rather than fortnightly. When a quarterly election is in force, the payment each fortnight is reduced by that portion which will accrue and be paid at the end of the quarter.  The remainder of the supplement continue — s to be paid fortnightly. Pensioners whose rate of pension is determined under the transitional provisions also have the option to receive an amount equal to the minimum pension supplement a — mount in a quarterly instalment.

Notification Methods

Pensioners may notify the Department by phone, letter, fax, in person or by email to change between fortnightly and quarterly minimum pension supplement payments. M — ember — s of a couple ca — n elect different payment frequencies.

Quarterly instalments

The amount of the quarterly instalment is worked out by multiplying the person's daily rate of minimum pension supplement amount by the number of days during the test period for which a quarterly election is in force.  The amount pa — yable will exclude any minimum pension supplement amount that has been paid fortnightly since the last test day. It will also exclude payment for any days that the person was not eligible to receive the minimum pension supplement amount, for example, if pension was granted part way through the quarter, or the pensioner was overseas longer than 13 weeks.

Test periods and test days

A test period starts on the most recent supplement test day and ends on the day immediately before the current test day.  Instalments are paid as soon as practicable after each test day. The quarterly pension supplement test days are:

• 20 March

• 20 June

• 20 September, and

• 20 December.

Tax-exempt pension supplement

The basic amount of pension supplement is taxable.  The tax exempt and the minimum amount components of the pension supplement are tax exempt.

Indexation of PSup rate

All three components of PSup are indexed twice each year. If the rates are increased the new rate takes effect from 20 March and 20 September each year.

Recovery of debts

Outstanding debts owed to DVA because of overpayment may be recovered by withholding pension supplement.