5.6.11 Bonus Payable to a War Widow/Widower who has Deferred Age Pension

Last amended: 22 April 2014

Bonus periods applicable to war widow/widower who has deferred age pension

In certain circumstances, a person who has been deferring age pension then becomes a war widow/widower before claiming age pension and their bonus, may have bonus periods accrued at Centrelink included in the calculation of their bonus by DVA. To have these bonus periods included in the bonus calculation, a war widow/widower must:

• have either been registered as a member of the Centrelink scheme before becoming a war widow/widower or, in the opinion of Commission, could have been so registered before becoming a war widow/widower,
• not have received a social security pension or benefit (other than a carer payment) at any time since reaching age pension age,
• not have claimed pension bonus under the social security law before becoming a war widow/widower, and
• have registered as a member of the DVA pension bonus scheme in respect income support supplement (ISS).

Person who has claimed but never received bonus under social security law

At some time before becoming a war widow/widower, it is possible for a war widow/widower to have claimed, but never received, age pension and bonus. If the person made such a claim at Centrelink but received no payment, either because they were ineligible or not payable, the period during which they deferred age pension can still be included in the calculation of the DVA bonus.

Bonus period accrued under social security law included in bonus calculation

A period during which a person has deferred age pension prior to becoming a war widow/widower may be treated as if it is a bonus period under the VEA. For this to occur Commission must determine that had the person applied for the bonus in respect of that period immediately before becoming a war widow/widower, that period would have accrued as a bonus period under social security law. This requires Commission to determine a number of matters, including whether particular periods were periods of accruing membership and whether the person or their partner passed the work test for those periods. If the person was not registered at Centrelink, the Commission must also determine from what date the person could have been registered.

Calculation of overall qualifying period

A person can accrue a maximum of five qualifying bonus periods with the most recent bonus periods taken into account when the bonus is calculated. The number of bonus periods accrued under the VEA will affect whether and to what extent any bonus periods accrued under social security can be included in the calculation of the bonus. Any decision made by a war widow/widower concerning when to claim pension and bonus should take account of this. Once five years has been accrued, any additional full-year bonus periods will take the place of the earlier bonus periods. As a result, the bonus periods accrued at DVA (which may attract a lower bonus because of the ceiling rate) will gradually replace those accrued at Centrelink (where payment is not subject to a ceiling).

Example of overall qualifying period calculation where war widow/widower has deferred age pension

Mrs Calley worked for three years after reaching age pension age and was deferring age pension. Her husband, who was a veteran, died just after the third anniversary of her registration for the scheme. She became a war widow upon his death, so then registered for the scheme with DVA and continued to work for another twelve months. Her overall qualifying period is four years. Her first bonus period commences on the date of her registration for the Centrelink scheme.

How bonus rules vary for war widows/widowers who have deferred age pension

Generally the rules applicable to the DVA pension bonus scheme apply to these war widows/widowers. However, the rules vary in the following respects:

• the person's first bonus period will normally not commence on the date the person first became an accruing member of the DVA scheme. It could commence as early as the first date the person became an accruing member of the Centrelink scheme,
• it is not necessary for a war widow/widower who meets the above criteria to have accrued any bonus periods since becoming a war widow/widower, provided she has accrued a minimum of one bonus period at Centrelink.

• If, for example, a woman has been accruing bonus periods at Centrelink and, upon the death of her veteran husband, she ceases work and claims ISS, she can claim her bonus from DVA without having deferred ISS for any period.
• It would also be possible for a person who becomes a war widow/widower after the age of 70 to have accrued bonus periods at Centrelink up until the day before becoming a war widow/widower, but at that point the widow/widower would cease accruing,

• if the war widow/widower has only accrued a part-year period of accruing membership at Centrelink, that period can be included in the calculation of the bonus if, when aggregated with a period accruing at DVA since becoming a war widow/widower, that period would amount to one year,
• if the war widow/widower has only accrued a part-year period of accruing membership with DVA, that period can be included in the calculation of the bonus if, when aggregated with a period accrued at Centrelink before the person became a war widow/widower, that period would amount to one year,
• if the war widow/widower was subject to a compensation preclusion period while deferring age pension, that period will reduce the length of the overall qualifying period, and     
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  5.6.5/Non-accruing Membership

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• any differences between the assessment of age pension and income support supplement will be reflected in the calculation of that part of the bonus which is based on the period age pension was deferred.    
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  Example of pension bonus calculation – change in pension deferred

  5.6.8/No change of Marital Status – Standard Formula not Applicable

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