5.8.8 Worked Examples of Multiple Interim Payments - prior to 1 July 2013

The following examples demonstrate the effect of multiple interim payments on a person's entitlements based on a single accepted impairment. The examples are based on the following set of information:

Payment	Date	Age	Impairment	Lifestyle	Calculation (warlike/non-warlike)
Interim A	2-7-2008	36	18 points	0	0.159 x $275.86 = $43.86 per week
Interim B	2-7-2009	37	30 points	0	0.265 x $286.07 = $75.81 per week
Final	2-7-2010	38	50 points	3	0.509 x $292.08 = $148.67 per week

Example 1 – Male choosing lump sum, periodic, periodic

Payment	Date	Age	Impairment	Lifestyle	Calculation (warlike/non-warlike)	Election
Interim A	2-7-2008	36	18 points	0	A = 0.159 x $275.86 = $43.86 per week $43.86 x 1232.4 = $54,053.06 lump sum	Takes lump sum of $54,053.06
Interim B	2-7-2009	37	30 points	0	B = 0.265 x $286.07 = $75.81 per week A1 (current equivalent of Interim A payment) = 0.159 x $286.07 = $45.49 per week $75.81 (B) - $45.49 (A1) = $30.32 per week	Takes periodic payment of $30.32 per week
Final	2-7-2010	38	50 points	3	Final = 0.509 x $292.08 = $148.67 per week A2 (current equivalent of Interim A payment) = 0.159 x $292.08 = $46.44 $148.67 (final) – $46.44 (A2) = $102.23 per week	Takes new periodic payment of $102.23 per week

In this example (1), the current weekly equivalent of the lump sum taken at Interim A is subtracted before the final calculation of weekly payments.

Example 2 – Male choosing periodic, lump sum, periodic

Payment	Date	Age	Impairment	Lifestyle	Calculation (warlike/non-warlike)	Election
Interim A	2-7-2008	36	18 points	0	A = 0.159 x $275.86 = $43.86 per week	Takes periodic payment of $43.86
Interim B	2-7-2009	37	30 points	0	B = 0.265 x $286.07 = $75.81 per week A1 = 0.159 x $286.07 = $45.49 per week $75.81 (B) - $45.49 (A1) = $30.32 per week $30.32 x 1218.1 = $36,932.79	Takes lump sum of $36,932.79 and continues periodic payment of $43.86 (indexed) per week
Final	2-7-2010	38	50 points	3	Final = 0.509 x $292.08 = $148.67 per week ($30.32 ? $286.07) x $292.08 = $30.96 (current equivalent of $30.32) $148.67 (final) – $30.96 = $117.71 per week	Takes new periodic payment of $117.71 per week

In this example (2), the weekly equivalent of the lump sum taken at Interim B is subtracted before the final calculation of weekly payments.

Example 3 – Male choosing lump sum, periodic, lump sum

Payment	Date	Age	Impairment	Lifestyle	Calculation (warlike/non-warlike)	Election
Interim A	2-7-2008	36	18 points	0	A = 0.159 x $275.86 = $43.86 per week $43.86 x 1232.4 = $54,053.06 lump sum	Takes lump sum of $54,053.06
Interim B	2-7-2009	37	30 points	0	B = 0.265 x $286.07 = $75.81 per week A1 = 0.159 x $286.07 = $45.49 per week $75.81 (B) - $45.49 (A1) = $30.32 per week	Takes periodic payment of $30.32 per week
Final	2-7-2010	38	50 points	3	Final = 0.509 x $292.08 = $148.67 per week A2 = 0.159 x $292.08 = $46.44 $148.67 (final) – $46.44 (A2) = $102.23 $102.23 x 1221.5 = $124,873.94 $124,873.94 – (52 weeks x $30.32) = $123,297.30	Takes lump sum of $123,297.30 ($124,873.94 minus Interim B already paid as periodic payments). Periodic payments will cease.

In this example (3), the weekly equivalent of the lump sum taken at Interim A is subtracted before the final calculation of weekly payments, which is converted to a lump sum. Also, the equivalent of the periodic payments paid for the 52 weeks between July 2009 & July 2010 is subtracted from the final lump sum calculation.

Example 4 – Male choosing periodic, periodic, lump sum

Payment	Date	Age	Impairment	Lifestyle	Calculation (warlike/non-warlike)	Election
Interim A	2-7-2008	36	18 points	0	A = 0.159 x $275.86 = $43.86 per week	Takes periodic payment of $43.86
Interim B	2-7-2009	37	30 points	0	B = 0.265 x $286.07 = $75.81 per week	Takes new periodic payment of $75.81 per week
Final	2-7-2010	38	50 points	3	Final = 0.509 x $292.08 = $148.67 per week $148.67 (final) x 1221.5 = $181,600.41 $181,600.41 – (52 weeks x $43.86 (A) + 52 weeks x $75.81 (B)) = $175,377.57	Takes lump sum of $175,377.57 ($181,600.41 minus total of Interim A & B already paid as periodic payments). Periodic payments will cease

In this example (4), the final assessment of weekly payments is converted to a lump sum.

Example 5 – Male choosing periodic, lump sum, lump sum

Payment	Date	Age	Impairment	Lifestyle	Calculation (warlike/non-warlike)	Election
Interim A	2-7-2008	36	18 points	0	A = 0.159 x $275.86 = $43.86 per week	Takes periodic payment of $43.86
Interim B	2-7-2009	37	30 points	0	B = 0.265 x $286.07 = $75.81 per week A1 = 0.159 x $286.07 = $45.49 per week $75.81 (B) - $45.49 (A1) = $30.32 per week $30.32 x 1218.1 = $36,932.79	Takes lump sum of $36,932.79 and continues periodic payment of $43.86 (indexed) per week
Final	2-7-2010	38	50 points	3	Final = 0.509 x $292.08 = $148.67 per week ($30.32 ? $286.07) x $292.08 = $30.96 (current equivalent of $30.32) $148.67 – $30.96= $117.71 per week $117.71 x 1221.5 = $143,782.76 $143,782.76 – (52 weeks x $43.86 (A) + 52 weeks x $45.49 (1)) = $139,136.56	Takes lump sum of $139,136.56 ($143,782.76 minus the total of Interim A already paid as periodic payments). Periodic payments will cease

In this example (5), the current weekly equivalent of the lump sum taken at Interim B is subtracted from the final calculation of weekly payments, which is converted to a lump sum. The final lump sum calculation also takes account of the periodic payments which were paid for 52 weeks at the 2008-2009 rate and 52 weeks at the 2009-2010 rate.

Ceasing periodic payments: In examples 3, 4 and 5, the person's periodic payments effectively cease. This is due to the final amount being converted to a lump sum. The 'special circumstances' provision in section 78(4) would need to be used to allow the person to choose to convert to a lump sum all PI compensation payable to them that has not previously been converted to a lump sum.

This provides additional flexibility to the claimant, otherwise, the amount that could be converted would be limited to the difference between the interims paid and the final assessment.

Source URL: https://clik.dva.gov.au/military-compensation-mrca-manuals-and-resources-library/policy-manual/ch-5-permanent-impairment/58-interim-permanent-impairment-compensation/588-worked-examples-multiple-interim-payments-prior-1-july-2013