C06/2014 June 2014 Statutory Increase Processing - Production and Mailout of Advice Letters with Payment Summaries, Standalone Payment Summaries (Issued Without a Covering Letter), and Medicare Levy Exemption Certificate

DATE OF ISSUE:  6 June 2014

June 2014 Statutory Increase Processing - Production and Mailout of Advice Letters with Payment Summaries, Standalone Payment Summaries (Issued Without a Covering Letter), and Medicare Levy Exemption Certificate

Replaces DI No.

N/A

Purpose of Instruction

This Departmental Instruction is to provide information about the processing arrangements for the June 2014 Statutory Increase (SI) processing of advice letters with payment summaries, Standalone Payment Summaries (issued without a covering letter), and Medicare Levy Exemption Certificate production and mailout.

Richard Magor

Assistant Secretary

Income Support & Grants

06 June 2014

Overview

Introduction

In June each year the Department undertakes a bulk exercise to issue all pensioner households with advice letters to persons in receipt of service pension, age pension including those in payment of Defence Force Income Support Allowance (DFISA) only, or income support supplement.  The majority of these letters will include Payment Summaries for the end of the financial year. Standalone Payment Summaries (issued without a covering letter) and Medicare Levy Exemption Certificates will also be issued at this time. The estimated number of mailpacks is given at Attachment A.

Major features of SI

Issues of significance with regard to this mailout are as follows: Production of advice letters to all service pensioners, income support supplement recipients and age pensioners including those being paid DFISA only; Adjustment of pension rates in accordance with adjustments to the Income Free Area, Assets Free Area and Deeming Thresholds; A full Income and Assets Attachment will be provided for all less than maximum rate pensioners; Full obligations will be provided for all pensioners being paid at less than maximum rate of pension; No Income and Assets Attachment will be provided to pensioners who are receiving the maximum rate of pension; Maximum rate pensioners will not be given the full obligations.  Instead a Financial Obligations paragraph that includes the prescribed rates will be in the body of the advices; End of Financial Year payment summary production; The Australian Taxation Office (ATO) insert – 'Do you need to lodge a tax return?' will only be issued to clients being paid at less than the maximum rate of income support pension, and to those receiving a Standalone Payment Summary (without a covering letter) or a Medicare Levy Exemption Certificate; Standalone Payment Summaries (SAPS), i.e. payment summaries sent without a covering letter, will be issued to clients who received some payment during the financial year but do not receive an advice letter, e.g. Centrelink DFISA clients or clients no longer in payment of income support pension; Payment summaries will list both taxable and tax exempt )ie non-taxable) payments; Production of Medicare Levy Exemption Certificates (MLEC); and Advice to pensioners of any gain or loss of treatment eligibility.

Production of Advice Letters

Processing Weekend – 13/06/2014 – 15/06/2014

Processing is scheduled to run from Friday evening, 13 June 2014 to Sunday, 15 June 2014. Any pension variations resulting from this exercise will be effective from 1 July 2014 for payday 10 July 2014.

Critical Dates

Processing period within DVA – (includes 'advices' processing)	Friday (pm) 13 June 2014 – Sunday (pm) 15 June 2014
Commencement of mailout production for advice letters with payment summaries, SAPS and MLECs	Wednesday, 18 June 2014
Progressive lodgment of all Advice Letters, SAPS and MLECs with Australia Post	Commencing Wednesday, 25 June 2014 and completed by CoB Tuesday, 1 July 2014

Letter Production	Computershare, located in Sydney, will print the advice letters, SAPS and MLECs, insert the ATO flyers where applicable, envelope and lodge all mail with Australia Post.
Lodgment of Letters	Letters will be progressively lodged with Australia Post commencing Wednesday, 25 June 2014.  All letters are to be posted by CoB Tuesday, 1 July 2014.

Letter Content

Letters and Attachments	Copies of the expected advice letter content for this run are reproduced at Attachment B.  Samples of the Payment Summary and Medicare Levy Exemption Certificate are reproduced at Attachment C and Attachment D, respectively.
Single and Joint Advices	All service pensioners and income support supplement recipient couples will receive a joint advice, provided both members of a couple, including the illness separated, have the same IMS postal address recorded. Age pensioners receive single advice letters unless otherwise requested. Important to note:  Staff are reminded that if a client in a joint assessment requests separate or single advices, they need to update this information using the mainframe PRODIMS – Client Correspondence (CO.CO) Screen prior to the processing run to initiate the client request. Advice default requests in CO.CO will override the DOCGEN advice rules.
Full Obligations & Full Income and Assets List	Full Obligations and Full Income and Assets attachments will be issued to pensioners receiving pension at less than the maximum rate. This is in line with the Repatriation Commission policy that: pensioners receiving pension at less than the maximum rate be provided with their Full Obligations and Full Income and Assets every two years – Full Obligations and Full Income and Assets were last issued to this group in June 2012. Full Obligations will not be issued to SP/ISS/AP recipients receiving the maximum rate of pension. This is in line with the Repatriation Commission policy that: pensioners receiving the maximum rate of pension are required to be provided with their Full Obligations at a minimum interval of once every five years – Full Obligations were last issued to this client group in June 2013.  The next issue will be in June 2018.  Full Income and Assets attachments are not issued to this client group.
Financial Obligations including Prescribed Rates	The Financial Obligations paragraph, which includes prescribed rates information, will be present in the advices for all maximum rate SP/ISS/AP pensioners.
Payment Information Attachment	SP/ISS/AP pensioners who remain on maximum rate following the processing will not have a Payment Information Attachment printed as part of their advice as they are considered to be continuation cases. SP/ISS/AP pensioners whose pension rates have varied following the processing will receive a Payment Information Attachment.
Tasmanian Office Clients with Overseas Postal Address	Advice letters for Tasmanian Office clients with an overseas postal address will have their advices printed and posted directly from the Mailing House.
Non Taxable Pensioners	Those pensioners whose pensions are not taxable (eg. those in payment of invalidity service pension and who are under 65 years of age) will receive an advice letter with a payment summary.  As the number of Medicare Levy exemption days will be recorded on the payment summary, a separate MLEC will not be required.
PAYG Payment Summary	Payment summaries will be issued to all clients who received a payment from DVA during the 2013/2014 financial year.  Clients will be sent a payment summary listing both taxable and tax exempt (i.e. non-taxable) payments.  The tax exempt payment information will be broken into the following categories: Tax-free pensions and benefits including tax exempt disability pension, war widow/widower pension, service pension and income support supplement; and Other tax exempt payments. Payment summaries will form part of the advice letter for all income support payment recipients.  Where a payment summary is sent without a covering letter, it is referred to as a Standalone Payment Summary (SAPS). Payment summaries will not be sent to clients who are under 16 years of age on 30 June 2014, and did not receive a taxable payment in the financial year 2013/2014. A sample of the payment summary can be found at Attachment C.
General Information Sheet (GIS)	Each advice letter, except those for overseas pensioners, will have a General Information Sheet (GIS).  The GIS provides details of payment rates, income and asset thresholds, deeming rates and thresholds, treatment thresholds, rent assistance rates and other payment information.  There will be a separate GIS for clients assessed under the transitional rules and for those assessed under the non-transitional rules because different rates and thresholds apply. Some components of the pension supplement (pension supplement non-taxable and pension supplement flexible) are not payable to overseas pensioners.  Therefore, the information provided on the GIS is not applicable to them.  For this reason, overseas pensioners will not be issued with the GIS to avoid confusion.
ATO insert – Do you need to lodge a tax return?'	A 'pensioner flyer' produced by the ATO titled “Do you need to lodge a tax return?” will only be included in the advice letters produced for those in payment of less than the maximum rate of income support pension, those being issued a SAPS or a MLEC. The flyer will not be sent to those clients being paid at the maximum rate of income support pension. Each location will be supplied with a quantity of the flyers to insert with their Enclosures (treatment changes) or Reduction to Nil advice letters which will print at each location's nominated printer.
Pensioners to Contact ATO with Taxation Questions	It is important for DVA staff to note that pensioners have been advised in their letters to contact the Australian Taxation Office on 13 28 61 if they have any questions about taxation.  Should pensioners ring DVA offices with questions relating to taxation matters, staff should refer them to the Australian Taxation Office on 13 28 61. IMPORTANT NOTE:  DVA staff must not offer advice about taxation liability or the need to lodge a tax return.
Information on Tax Thresholds in VIEW	The 'Senior Australians Tax Offset' and 'Pensioner Tax Offset' amounts are displayed in the 'Tax Threshold Amounts' folder in the 'Fin Year Certificate' tab in VIEW.  The 2013/2014 threshold amounts will be available in VIEW from 1 July 2014.  Additional information about these thresholds is provided via VIEW Online Help.

Standalone Payment Summaries (issued without a covering letter)

SAPS – sent without a covering letter	SAPS will be produced for the following categories: Persons issued with an Education Allowance; Working Rule B Widows; Pensioners who received income support payment for part of the financial year and are no longer in payment of an income support pension; Disability pensioners and war widows/widowers who do not receive any income support payments; Overseas addressees (for clients who were in payment for part of the year but are no longer in payment); and Centrelink clients in payment of DFISA.
SAPS – posted directly to clients from the Mailing House	All SAPS, with the exception for overseas addressees listed above, are to be printed and enveloped at the mailing house, and lodged with Australia Post directly from the mailing house. In June 2013, DVA issued 80,715 SAPS. It is estimated that a similar number of SAPS will be issued in 2014 based on this statistic.
SAPS – Overseas Addressees	SAPS for clients who reside overseas and who are no longer in payment will not be printed at the mailing house.  A zip file of each SAPS category will be emailed to each location contact officer.  It lists the clients who reside overseas who are to receive a SAPS.  Staff should request a re-print for those overseas clients listed on the report and send their SAPS directly to them.
SAPS – Unknown Addressees	Where a client has an 'unknown address' recorded, a SAPS will not be produced.  A listing of clients with an 'unknown address' will be provided to each location contact officer.
SAPS – For Deceased Clients	SAPS for clients who have died during the financial year will not be printed at the mailing house.  Staff will be able to request a re-print of a deceased client's payment summary when required from 1 July 2014.
SAPS Reports	A SAPS report is generated for each of the following categories: MRCA Education Allowance; Education Allowance; Other; Group Destination; Overseas; Unknown Address; and Deceased. A report file for each category will be emailed in a zip file to the contact officer in each location.
Return Address if not Delivered	All SAPS mailpacks sent from the mailing house will be enveloped in a single window-faced envelope with a return address of GPO Box 9998 in your Capital City.
Payment Summary Reprint Facility - VIEW Advices Tab	From 1 July 2014, payment summaries for the 2013 - 2014 financial year may be re-generated using the 'Payment Summary Reprint' facility located under the Advices Tab in VIEW.
Payment Summary Template	The June SI Income Support contact officers will be provided with a 2013 - 2014 Payment Summary Template.
Medicare Levy Exemption Certificates (MLEC)	A MLEC will be issued to those Gold Card beneficiaries who are not in receipt of an income support payment and who do not receive an advice letter, that is: Australian veterans with Qualifying Service and over 70 years of age who are not in receipt of any payment from DVA. The number of Medicare Levy exemption days, where applicable, will be stated on the payment summary for all other pensioners. A sample of the Medicare Levy Exemption Certificate to be issued in 2014 can be found at Attachment D.
Medicare levy exemption – For Blind Pensioners	Blind pensioners in receipt of an income support payment are eligible for full or half Medicare Levy exemption.  The number of eligible exemption days will be printed on their Payment Summaries.
Zip File of MLEC Reports	A report of all clients who receive a MLEC will be produced and emailed in a zip file to the nominated contact officer. A MLEC will not be produced where a client has an 'unknown address' recorded.  However, a report will be produced and emailed in a zip file to all contact officers, listing those clients who are eligible to receive a MLEC but have an unknown address recorded.
MLEC Template	The June SI location contact officers will be provided with a MLEC Word template for manual issues of MLECs if required.

Issues Requiring Staff Action

ZIP Files of Advice Schedule Reports	A Zip File listing details of all clients who receive an advice will be emailed to the nominated contact officer in each location during the week following the processing run.  The Zip File replaces the Advices Schedule Report, which is too large to print on printers.
Enclosure (Treatment change) Advice Letters	Following the June SI processing, the Enclosure (treatment change) letters will be printed at the nominated printer at each location. It is requested that the streamed advice letters be checked for accuracy, and reconciled against the reports received in each location to ensure they reflect the correct treatment paragraphs. If any advice with incorrect treatment information is found, please consult with the Income Support System Support Officers to ensure correct information is provided in the manual replacement advice.
Reduction to Nil Letters	Following the June SI processing, any Reduction to Nil advice letters will be printed at the nominated printer at each location.  Staff are required to include a Commonwealth Seniors Health Card (CSHC) claim form, a CSHC fact sheet and a reply paid envelope with the advice in the mailpack.
'HELD' Advices to be Forced	As part of the Batch processing run all advices in 'Held' status will be forced to print.  Forced 'held' advices will print at the nominated printer in each respective location as part of the production run.  All forced advices will need to be checked to ensure the content of the advices is correct prior to posting to clients.
Handling of Daily Advices	Cases processed prior to the SI run should have the daily advice dispatched prior to the June advice letter being sent. Daily advices processed after the cutoff date of 13 June 2014 should be held by staff in each location until confirmation is received from the June SI Business Co-ordinator to release such advices.  This will ensure that pensioners receive their advices in chronological order.
Reprints of June SI Advices via VIEW Advices Tab	Reprints of individual advice letters produced from the quarterly processing can be requested via VIEW – Advices Tab reprint facility.  Quarterly advice reprints are available and can be requested from day one of the next quarter ie. March quarterly advices from 01/04/yyyy, June quarterly advices from 01/07/yyyy and September quarterly advices from 01/10/yyyy.
Staff Requests for Reprints of Daily Advices – Pre-SI Processing	The 'Reprint' scheduled jobs which produce the requested reprints of daily advices by staff are postponed as part of the SI processing.  Any requests for an advice reprint on the day of the commencement of the SI processing will not be actioned until after the SI run when the next 'Reprint' job is submitted.  'Unprinted' advice reprint requests will then print when the next 'Reprint' job is submitted.
DVA – Income Support Contact Officers	A contact person from each location acts as a liaison point for the Advices Team, and to assist with handling of streamed advices printed at each of the nominated location's printers. The Income Support (IS) Contacts for the June 2014 quarterly processing exercise are as follows:

NSW/ACT VIC QLD SA/NT WA TAS

Genia Sacharczuk/Steven Weston Greg Heitsch Stephen Hamill Maria Nasilowski Michelle Pauly/Margarete Mumme Daimeon Horne

Cards & Advices Team Contacts

Feedback from Staff	Any concerns regarding letters produced as part of this run should be directed to the Advices Help Desk – ACT mailbox.  Please ensure that any problems are reported without delay.
Contact Details	Any queries regarding advice wording, mail house printing and letter lodgement should be directed to the Advices Help Desk – ACT mailbox.

ATTACHMENT A

HOUSEHOLDS TO RECEIVE ADVICE LETTERS WITH PAYMENT SUMMARIES OR STANDALONE PAYMENT SUMMARIES OR MEDICARE LEVY EXEMPTION CERTIFICATES

ESTIMATES BASED ON 2013 STATISTICS

STATE	JOB 1 - Less than Maximum Rate	JOB 2 - Maximum  rate	JOB 3 - Overseas	Total no of advice letters (Job 1+2+3)	JOB 4 - Standalone Payment Summary	JOB 5 - Medicare Levy Exemption Certificate
NSW	15398	39158	-	54556	26245	476
VIC	11026	26093	-	37119	15836	317
QLD	11077	22269	-	33346	23081	192
SA	7537	16372	-	23909	5890	88
WA	5613	10295	-	15908	7654	136
TAS	1831	4030	651	6512	2009	0
TOTAL	52482	118217	651	171350	80715	1209

Please note:

• The advice letters numbers provided are based on the June 2013 statistics.
• Northern Territory clients are included in the numbers for South Australia and ACT clients are included in the NSW numbers.

ATTACHMENT B

JUNE 2014 SI PARAGRAPH CONTENT

Example 1:

• SERVICE PENSION
• LESS THAN MAXIMUM RATE – VARIATION (INCREASE)
• ASSETS TESTED

• JOINT ASSESSMENT

• TAXABLE
• PAYMENT SUMMARIES ENCLOSED
• GENERAL INFORMATION SHEET (GIS) ENCLOSED

GPO Box 9998 Brisbane  QLD  4001

Telephone:

Capital city callers: 133 254

Non-capital city callers: 1800 555 254

Facsimile: (07) 3223 8479

14 June 2014

044   123 456 789

MR JOHN SMITH

MRS MARY SMITH

123 SAMPLE STREET

MODELTOWN  QLD  4010

YOUR FILE NUMBER IS QX000000

Dear Mr and Mrs SMITH,

This is to advise you that your service pension has been increased.  This change will take effect from 1 July 2014.

Payment Information

Details of your fortnightly payments are provided in the Payment Information Attachment.

Cost of living changes to the Income and Assets Test

Recent increases in the cost of living have been applied to the following income and assets limits for service pension:

• Income Free Area – this is the amount of gross income you can have before your service pension is reduced below the maximum rate payable;
• Assets Value Limit – this is the amount of assets you can have (other than your family home) before your service pension is reduced below the maximum rate payable;
• Deeming Thresholds – these are the amounts of financial assets you can have before the higher deemed interest rates are applied to the assessment of service pension.

For details on these changes, please refer to the General Information Sheet which is attached to this letter.

Issue of 2013/2014 Financial Year Payment Summaries

As it is the end of the 2013/2014 financial year, Payment Summaries are being issued.  You will need this information if you are required to lodge a tax return.

Payment Summary for JOHN SMITH is enclosed with this letter.

Payment Summary for MARY SMITH is enclosed with this letter.

If you are unsure as to whether you are required to lodge a tax return or if you have any questions about taxation matters you should contact the Australian Taxation Office on 13 28 61.

Department of Veterans' Affairs' staff are unable to assist with taxation enquiries.

Medicare Levy Exemption

If you have been eligible for full treatment at departmental expense during the past financial year, you are eligible for a full or half exemption from payment of the Medicare levy for that period.  The number of days you are eligible for a full or half Medicare levy exemption is shown on your Payment Summary.

Your Income and Assets

Your service pension is assessed under the assets test using your income and assets as shown in the attached list.  It is important that you check that this list is a full and accurate statement of your income and assets.

Events You Must Tell Us About

Details of your obligations to notify us of changes to your circumstances are included in the attachment 'Statement of Obligations - Important Information You Should Retain'.  These apply to both you and your partner and it is important that you both read them.

Changes You Have Already Told Us About

If you have told us recently about a change to your income and assets or your domestic situation, it may not have been processed before this letter was sent.  If this is the case, we will send you another letter providing details of your new pension assessment when that change has been finalised.  This normally takes no more than 4 weeks.

Your Right of Review

If you do not agree with this variation to your pension, you may apply to have it reviewed by a Review Officer at this office.  If you do decide to apply, you must do so within three months of being advised of this decision.  Such a request for review must be in writing, and must set out your reasons for seeking this review.

If you have any questions regarding this letter please contact the Department on the telephone number shown at the top of this letter. If you prefer to communicate with us by mail, e-mail or in person, please view our website at www.dva.gov.au for contact details.

Yours sincerely,

ALISON STANLEY

Deputy Commissioner

as Delegate of the Secretary and Repatriation Commission

ATTACHMENTS

• Payment Information Attachment
• Income and Assets Attachment
• Statement of Obligations

• Payment Summary/s

• General Information Sheet

PAYMENT INFORMATION ATTACHMENT

The Department calculates pension payments on a daily basis.  This means that your fortnightly pension payment is made up of 14 days of entitlement of pension.  Therefore, when there is a change to your circumstances on any particular day in the fortnight, your pension will be adjusted from that day.  For that reason your pension payment may be different for one or two paydays after a reassessment.

Payment for 10 JULY 2014  VeteranPartner

Payment for 24 JULY 2014  VeteranPartner

Please Note: If you have an overpayment or lump sum advance which is currently being recovered (by deductions from your fortnightly pension), the amount paid into your account may be less than the total fortnightly payment shown above.

INCOME AND ASSETS ATTACHMENT

(Information currently used to assess your pension)

The following is a complete list of your Income and Assets as recorded by the Department.  If any details are incorrect or have been omitted you should notify the Department within 14 days (28 days if you are living overseas or receive remote area allowance).  Please note that failure to fulfil this obligation may lead to your service pension being overpaid.  Such overpayments are recoverable.

You are receiving service pension at less than the maximum rate payable.

The amount that you are paid depends on your combined income and assets but does not include the home in which you live.  The pension is calculated under two separate tests: an income test and an assets test.  The test that pays the lower rate of pension is the one that applies.

You are currently paid under the assets test.  The total of your assessed fortnightly income is $X,XXX.XX.  The total of all your assets (excluding any deductible assets) is $XXX,XXX.XX.  Details of how your pension has been assessed are shown below.

FINANCIAL ASSETS

Savings and Cheque Accounts

Description	Account Number	Asset Amount
XXXXXXXX	XXXXXXXXXXX	$XXXX.XX
XXXXXXXX	XXXXXXXX	$XXX.XX

Listed Securities and Unlisted Public Securities

Description	No. of Shares	Asset Amount
XXXXXX	X,XXX	$XX,XXX.XX
QQQQQQQQQQQQQ	XXX	$X,XXX.XX

Managed Investments

Description	Units	Asset Amount
VVVVVVVVVV	XX	$XXX.XX
CCCCCCCCCCCCC	XXX	$XXX.XX

Total Financial Assets

FINANCIAL ASSETS VALUE	DEEMED INTEREST RATE	DEEMED INCOME PER FORTNIGHT
$XX,XXX.XX	X.X%	$XX.XX
$         XX.XX	X.X%	$XX.XX
$XX,XXX.XX		$XX.XX

What is Deemed Income?

For pension purposes, income from financial assets such as accounts with banks, building societies and credit unions, loans, bonds, debentures, gifts, shares, managed investments and bullion is deemed.  The value of all your financial assets are added together, and deemed interest rates are applied to calculate the income.

At present, deemed income is calculated as follows, on the total of all your financial assets:

$0 to $XX,XXX - at X.X%

$XX,XXX + - at Y.Y%

If your investments are earning more than the X.X% or Y.Y% deeming rates, this additional income will not affect the rate of your T-PENSION-SP-ISS-AP.

IMPORTANT: You only need to notify the department if there are any changes to the value of your financial assets, as shown above.  You do not need to advise of any changes to the interest rates of these investments.

OTHER INCOME AND ASSETS

The following assets are those, which do not have deeming applied to them but are still used to determine your rate of pension.

Home Assets

The asset and/or income values shown below are the amounts used for pension purposes.

• Market value of household contents - $XX,XXX.XX

Miscellaneous Assets

• T-MISC-ASSET-DESCRIPTION with a net market value of $X,XXX.XX

Direct Income

• T-DESCRIPT-MISC-EARNINGS - $XX.XX per fortnight

STATEMENT OF OBLIGATIONS

IMPORTANT INFORMATION YOU SHOULD RETAIN

(Information current as at T-ADVICE-PRINT-DATE)

Events You Must Tell Us About

You must tell us within 14 days (28 days if you are living overseas or receive remote area allowance) if any of the events listed below occur.  These events may affect the amount of service pension you receive.  If you do not tell us of any of these changes you may be overpaid.  We are entitled under section 205 of the Veterans' Entitlements Act 1986 to recover this overpayment.

You will also need to tell us the date any changes to your circumstances occur.

When you are telling us of changes to your circumstances you should do this by telephoning or visiting any Department of Veterans' Affairs Office, or by writing to the Deputy Commissioner.

Obligations - Financial

You currently receive service pension at less than the maximum rate because your assets are above the current threshold.

You are obliged by law to tell us within 14 days (28 days if you are living overseas or receive remote area allowance) if you gain or dispose of any assets.  You must also notify this Department if your combined gross income from all sources increases above $X,XXX.XX per fortnight.  This will ensure that your service pension continues to be paid at the correct rate.

If your combined assets are reduced, any increase in pension can only be made the day your new details are received by us.

The following information may assist you to decide what you need to tell us about:

Some examples of what you need to tell us about

• Increases to the total value of your financial investments.

• Money acquired through inheritance, lotteries, gambling, etc.
• Increases to income from other sources eg. wages, superannuation.
• If you give away $10,000 or more worth of assets in a tax year or $30,000 or more in a five-year rolling period that commences on, or any time after 1 July 2002.  Assets may be cash or non-cash assets such as a car or other property.

Some examples of what you do not need to tell us about

(This information is obtained from the finance industry)

• Changes to the interest rates paid on your savings and investments.
• Changes to the unit value or rates of return for investments in publicly listed companies.
• Restructures of publicly listed companies in which you have money invested.

Obligations – Domestic Situation

You must tell us if:

• You live apart because of age, ill health or any other reasons
• You get divorced
• Your partner passes away.

Obligations – Homeowner

As a homeowner, you must tell us full details if:

• You sell your home
• Either of you leave your home because of age or ill health
• You rent or sublet your home
• Either of you leave your home for any period in excess of twelve months

Obligations – General

• Either of you change your postal and/or residential address,
• Either of you leave Australia,
• Either of you are granted any pension or benefit from the Department of Families, Housing, Community Services and Indigenous Affairs,
• Either of you are granted any pension or benefit from an overseas authority,
• Either of you make a claim or receive workers compensation, sickness or accident insurance other than a payment of disability, war widow's or war widower's pension from this department,
• Either of you are imprisoned after conviction for an offence,
• Either of you are the beneficiary, trustee or controller of a private trust, including a testamentary trust or a special disability trust.

Conclusion

The above are your full obligations to the Department.  If you have any queries about any of the above matters please contact this office at the address or telephone number shown at the top of this letter.

Example of the General Information Sheet (GIS) for Service Pensioners (non-transitional). There are separate GIS for transitional, income support supplement and age pension recipients.

GENERAL INFORMATION ON SERVICE PENSION RATES AND LIMITS

(Information current as at 1 July 2014)

MAXIMUM RATES OF SERVICE PENSION (including supplements)

Singles Rate$XXX.XX (per fortnight)

Couples Rate (each)$XXX.XX (per fortnight)

PENSION INCOME LIMIT (per fortnight)            Income Free Area            Cut Off

Singles Limit                                     $XXX.XX$X,XXX.XX

Couples Limit (combined)                                     $XXX.XX$X,XXX.XX

INCOME TEST : Pension rate is reduced by 50 cents for each dollar of income above the income free area.

PENSION ASSETS LIMIT                                     Assets Free Area             Cut Off

Home Owner

Singles Limit                                    $XXX,XXX    $XXX,XXX

Couples Limit (combined)                                    $XXX,XXX$X,XXX,XXX

Non Home Owner

Singles Limit                                    $XXX,XXX    $XXX,XXX

Couples Limit (combined)                                    $XXX,XXX$X,XXX,XXX

ASSETS TEST : Pension rate is reduced by 37.5 cents for every $250 of assets above the assets free area.

NOTE:

• Income and assets limits do not apply to blinded service pensioners.
• Higher income and assets cut off limits may apply if rent assistance is payable.
• Both income and assets tests are applied to work out a pension rate.  The rate of pension paid is the lower of the two.

GOLD CARD INFORMATION

The Gold Card income and assets limits shown in the next section do not apply if:

• Your disability pension is above 50% of the general rate and you also receive an amount of service pension (including pension supplement).  Should your service pension cease due to excess income and assets, you will no longer be eligible for a Gold Card; or

• You receive a disability pension at 100% of the general rate, Intermediate rate, EDA or TPI; or
• You are aged 70 years or over and you are a veteran who served in Australia's Defence Force and have qualifying service from any conflict or you are an Australian Mariner with qualifying service from World War II.

The Gold Card income and assets limits shown in the next section apply if:

• You receive a disability pension below 50% of the general rate and you also receive an amount of service pension; or
• You are an Australian veteran or mariner whose eligibility for the Gold Card is dependent solely on your service pension payment.

GOLD CARD INCOME CUT OFF LIMITS

Singles Limit                                          $XXX.XX (per fortnight)

Couples Limit (combined)                     $XXX.XX (per fortnight)

GOLD CARD ASSETS CUT OFF LIMITS

Home OwnerNon Home Owner

Singles Limit$XXX,XXX$XXX,XXX

Couples Limit (combined)$XXX,XXX$XXX,XXX

DEEMING

Deeming assumes that any money you have invested in financial assets is earning a particular amount of income regardless of the actual amount earned.  The deeming rates are:

SinglesLow Rate:- 2.0% interest up to the threshold of $48,000

High Rate:- 3.5% interest for the remaining balance

CouplesLow Rate:- 2.0% interest up to the threshold of $79,600

High Rate:- 3.5% interest for the remaining balance

ILLNESS SEPARATED COUPLES

Couples separated due to ill health are paid the single rate of service pension but have their income and assets assessed as a couple.

RENT ASSISTANCE

You may be eligible for rent assistance if you pay rent to a non-government body or landlord.  Rent assistance is not payable if you reside in a government funded (approved) nursing home, or in government funded housing.

The amount of rent assistance you received depends on the amount of rent you pay and your family circumstances.  Rent assistance is paid at the rate of 75 cents in the dollar for every dollar you pay over the set rent limits.

Maximum Amount of Rent Assistance Payable (per fortnight)

No children1-2 children3 or more children

Singles Rate$XXX.XX$XXX.XX$XXX.XX

Couples Rate(combined)$XXX.XX$XXX.XX$XXX.XX

Rent Limit (per fortnight)

No children1-2 children3 or more children

Singles Limit$XXX.XX$XXX.XX$XXX.XX

Couples Limit (combined)$XXX.XX$XXX.XX$XXX.XX

GIFTING

A gift is an asset which is given away or disposed of without receiving the market value of that gift in return.  A gift may be either a cash amount or non cash assets such as a car or other property.

You must notify us if you give away a total of $10,000 or more in a tax year or $30,000 over a rolling five-year period.

The amount above either limit will continue to be counted as if it were still your asset for a period of 5 years and may therefore continue to affect your pension.  We will also deem income on the value of any gift above either limit for 5 years.

Example 2:

• AGE PENSION PLUS DFISA
• LESS THAN MAXIMUM RATE – VARIATION (INCREASE)
• SINGLE ASSESSMENT

• TAXABLE
• PAYMENT SUMMARY ENCLOSED
• GIS ENCLOSED

GPO Box 9998 Brisbane  QLD  4001

Telephone:

Capital city callers: 133 254

Non-capital city callers: 1800 555 254

Facsimile: (07) 3223 8479

14 June 2014

045   123 456 789

MR ROBERT MURDOCH

223 SAMPLE STREET

MODELTOWN  QLD  4010

YOUR FILE NUMBER IS QX000000

Dear Mr MURDOCH,

This is to advise you that your:

• age pension has been increased.

• Defence Force Income Support Allowance (DFISA) has varied.

This change will take affect from 1 July 2014.

Payment Information

Details of your fortnightly payments are provided in the Payment Information Attachment.

Cost of living changes to the Income and Assets Test

Recent increases in the cost of living have been applied to the following income and assets limits for age pension:

• Income Free Area - this is the amount of gross income you can have before your age pension is reduced below the maximum rate payable;
• Assets Value Limit - this is the amount of assets you can have (other than your family home) before your age pension is reduced below the maximum rate payable;
• Deeming Thresholds – these are the amounts of financial assets you can have before the higher deemed interest rates are applied to the assessment of age pension.

For details on these changes, please refer to the General Information Sheet which is attached to this letter.

Issue of 2013/2014 Financial Year Payment Summaries

As it is the end of the 2013/2014 financial year, Payment Summaries are being issued.  You will need this information if you are required to lodge a tax return.

Payment Summary for ROBERT MURDOCH is enclosed with this letter.

If you are unsure as to whether you are required to lodge a tax return or if you have any questions about taxation matters you should contact the Australian Taxation Office on

13 28 61.

Department of Veterans' Affairs' staff are unable to assist with taxation enquiries.

Medicare Levy Exemption

If you have been eligible for full treatment at departmental expense during the past financial year, you are eligible for a full or half exemption from payment of the Medicare levy for that period.  The number of days you are eligible for a full or half Medicare levy exemption is shown on your Payment Summary.

If you were previously being paid by Centrelink, they will issue a Payment Summary to you separately.

Your Income and Assets

Your service pension is assessed under the assets test using your income and assets as shown in the attached list.  It is important that you check that this list is a full and accurate statement of your income and assets.

Events You Must Tell Us About

Details of your obligations to notify us of changes to your circumstances are included in the attachment 'Statement of Obligations - Important Information You Should Retain'.  These apply to both you and your partner and it is important that you both read them.

Changes You Have Already Told Us About

If you have told us recently about a change to your income and assets or your domestic situation, it may not have been processed before this letter was sent.  If this is the case, we will send you another letter providing details of your new pension assessment when that change has been finalised.  This normally takes no more than 4 weeks.

Your Right of Review

If you do not agree with this decision, you can contact your nearest Veterans' Affairs office and discuss the reasons for the decision.  If you remain dissatisfied, you may apply to have the decision reviewed by an Authorised Review Officer, with no prior involvement in the case.  If you decide to apply for a review more than 13 weeks from the day this notice is given to you, you can only be paid an adjustment from the date we receive your application.  Requests for review may be made in person, by telephone or in writing.

The rate of DFISA paid to you is derived from your age pension assessment.  You may seek to have your age pension assessment reviewed if you are dissatisfied with your DFISA rate.

If you have any questions regarding this letter please contact the Department on the telephone number shown at the top of this letter. If you prefer to communicate with us by mail, e-mail or in person, please view our website at www.dva.gov.au for contact details.

Yours sincerely,

ALISON STANLEY

Deputy Commissioner as Delegate of the Secretary

ATTACHMENTS

• Payment Information Attachment
• Income and Assets Attachment
• Statement of Obligations

• Payment Summary             

• General Information Sheet

Example 3:

• INVALIDITY SERVICE PENSION
• MAXIMUM RATE

• NON TAXABLE
• PAYMENT SUMMARY ENCLOSED
• GIS ENCLOSED

GPO Box 9998 Brisbane  QLD  4001

Telephone:

Capital city callers: 133 254

Non-Capital city callers: 1800 555 254

Facsimile: (07) 3223 8479

14 June 2014

046   123 456 789

MR BILL BROWN

323 SAMPLE STREET

MODELTOWN  QLD  4010

YOUR FILE NUMBER IS QX000000

Dear Mr BROWN,

I am writing to you about your service pension payment from Veterans' Affairs. You currently receive the maximum rate of service pension and this amount remains unchanged.

Cost of living changes to the Income and Assets Test

Recent increases in the cost of living have been applied to the following income and assets limits for service pension:

• Income Free Area – this is the amount of gross income you can have before your service pension is reduced below the maximum rate payable;
• Assets Value Limit – this is the amount of assets you can have (other than your family home) before your service pension is reduced below the maximum rate payable;
• Deeming Thresholds – these are the amounts of financial assets you can have before the higher deemed interest rates are applied to the assessment of service pension.

For details on these changes please refer to the General Information Sheet which is attached to this letter.

Issue of 2013/2014 Financial Year Payment Summaries

As it is the end of the 2013/2014 financial year, Payment Summaries are being issued.  You will need this information if you are required to lodge a tax return.

Payment Summary for BILL BROWN is enclosed with this letter.

If you are unsure as to whether you are required to lodge a tax return or if you have any questions about taxation matters you should contact the Australian Taxation Office on

13 28 61.

Department of Veterans' Affairs' staff are unable to assist with taxation enquiries.

Medicare Levy Exemption

If you have been eligible for full treatment at departmental expense during the past financial year, you are eligible for a full or half exemption from payment of the Medicare levy for that period.  The number of days you are eligible for a full or half Medicare levy exemption is shown on your Payment Summary.

Financial Obligations

You need to tell us within 14 days (28 days if you are living overseas or receive remote area allowance) if your total income from all sources is more than $XXX.XX per fortnight or the value of your total assets is more than $XXX,XXX.XX.

Other Obligations

We have explained your obligations to you in previous letters and the booklet 'You and Your Pension'.  These obligations still apply.

Changes You Have Already Told Us About

If you have told us recently about a change to your income and assets or your domestic situation, it may not have been processed before this letter was sent.  If this is the case, we will send you another letter providing details of your new pension assessment when that change has been finalised.  This normally takes no more than 4 weeks.

If you have any questions regarding this letter please contact the Department on the telephone number shown at the top of this letter. If you prefer to communicate with us by mail, e-mail or in person, please view our website at www.dva.gov.au for contact details.

Yours sincerely,

ALISON STANLEY

Deputy Commissioner

as Delegate of the Secretary and Repatriation Commission

ATTACHMENTS

• Payment Summary
• General Information Sheet

ATTACHMENT C

GPO Box 9998  in your Capital City

XXXX  SMITH

XXXXXXXX STREET

SUBURB  STATE  POSTCODE

Payee Details

XXXX SMITH

XXXXXXX STREET

SUBURB STATE POSTCODE

DVA file number	QX000000
Payee's tax file number	444 444 444
Total tax withheld	$XXX.XX
Gross taxable payments	$XXXX.XX
Total tax exempt payments	$XXXXX.XX
- Tax-free pensions and benefits	$XXXX.XX
- Other tax exempt payments	$XXXX.XX
Medicare levy full or half exemption days	XXX
Remote area allowance	$XXX.XX

Payer Details

Payer's ABN or withholding number:    2396 4290 824

Payer's name:    Department of Veterans' Affairs

Signature of authorised person:    ALISON STANLEY

Date:    14/06/14

See notes on reverse.

Notes:

Total tax withheld: The amount Veterans' Affairs has deducted from your payments for tax.  If you have an amount in total tax withheld, you should lodge a tax return to ensure that you receive any refund of withheld tax you may be entitled to.  If no tax was withheld, you may still have to lodge a tax return.

Gross taxable payments: The amount you should include as income under 'Australian Government pensions and allowances' in the Income section if you are completing a tax return.

Total tax exempt payments: The total of the tax exempt payments you were paid for the tax year, including Tax-free pensions and benefits and Other tax exempt payments.

Tax-free pensions and benefits: Tax exempt payments that you should include on your tax return under 'Tax-free Government Pensions or Benefits'.  This amount may also need to be declared on your spouse's tax return as 'spouse's tax exempt pension income'.

Other tax exempt payments: Tax exempt payments that you do not need to show on your tax return.

Medicare levy exemption: A holder of a Veterans' Affairs Gold Card for medical treatment is eligible for a full or half exemption from paying the Medicare Levy.  If you are eligible for an exemption, your number of Medicare Levy exemption days is shown on this payment summary.  The number of days shown should be included in the Medicare levy section of your tax return.

Remote area allowance: You will need to include your Remote area allowance separately on your tax return if you are claiming a zone tax offset.

Further assistance: If you have any taxation enquiries, including whether you need to lodge a tax return or whether you qualify for a full or half Medicare Levy exemption, read the Individual tax return instructions for the relevant financial year, call the Australian Taxation Office on 13 28 61 between 8.00 am and 6.00 pm Monday to Friday, or visit www.ato.gov.au.  Enquiries about your payments should be directed to the Department of Veterans' Affairs.

The Australian Taxation Office checks information shown in tax returns

against information provided by the Department of Veterans'Affairs.

ATTACHMENT D

SAMPLE OF MEDICARE LEVY EXEMPTION CERTIFICATE

GPO Box 9998

In Your Capital City

Client name

Client address

Client address

Medicare Levy Exemption Certificate