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11.6.4 Payment Summaries
Who is sent payment summaries?
Payment summaries are sent to most pensioners (or their trustee) who receive any taxable payment or remote area allowance from DVA within each financial year.
When is a payment summary issued?
Payment summaries are issued at the end of each financial year. If at other times of the year a replacement is required, these can be issued at the relevant time.
Early release of a payment summary
Taxation legislation (the Tax Administration Act 1953) provides that a payment summary may be issued, on request, to a pensioner before the end of the financial year. The early release of a payment summary is intended to assist with the finalisation of tax assessments which may be needed before the end of the financial year, for example in administering an estate, in insolvency cases, or where pensioners are moving overseas.
The payment summary is to be provided within 14 days of the request being received. A person cannot make a request for early provision of a payment summary within 21 days of the end of the financial year.
Where a payment summary cannot be generated, the provision of the same payment and tax information by letter is permissible.
Reissue of payment summaries after overpayment
Where an overpayment has occurred, the payment summaries for the years affected by the overpayment can only be reissued when recovery of the overpaid amount for that year is completed. This is because the income for that year is only considered to have reduced once the repayment in respect of that year is completed.
Information contained in a payment summary
Each payment summary shows the following:
- total of all taxable payments (gross taxable payments) made by DVA within the financial year,
- total of any taxation amount withheld by DVA within the financial year,
- total tax exempt payments,
- tax-free pensions and benefits,
- other tax exempt payments,
- name of the pensioner,
- DVA file number,
- DVA state group number,
- pensioner's tax file number (TFN),
- number of days of Medicare Levy Exemption,
- total of any remote area allowance payments made by DVA within the financial year, and
- address of the pensioner.
Note: Some taxable Defence Force Income Support Allowance (DFISA) recipients may not have a TFN recorded with DVA. In this circumstance, a dummy number will be shown on their payment summary from DVA. This does not affect the validity of the payment summary. DFISA ceased to be paid 1 January 2022.More ?
Medicare Levy Exemption Certificates
If a veteran or war widow/widower who holds a Repatriation Health Card for All Conditions (Gold Card) does not receive a payment summary, DVA issues a Medicare levy exemption certificate for the financial year.
DVA does not calculate tax liability
DVA is responsible for calculating the amount of taxable payments it makes to a pensioner in the financial year. It is not responsible for calculating a pensioner's possible tax liability as that is a matter between the pensioner and the Australian Taxation Office.
Non taxable payments
Non-taxable payments are separately included on payment summaries.
The payments summary also identifies those non-taxable DVA payments which are a “tax free pension or benefit” as defined in the A New Tax System (Family Assistance) Act 1999. Tax free pensions and benefits must be separately declared on income tax returns for the purpose of income testing of other government benefits.
Remote area allowance also appears on the payment summary as it affects a person's eligibility for a Zone Tax Offset (formerly Zone Rebate) under the Income Tax Assessment Act 1936.More ?
Exclusion from supplying tax file number
Non-taxable payments made by DVA
Trustee has two meanings depending on the context, (i) and (ii).
(i) a person who looks after someone else's affairs
According to section 202 of the VEA, a trustee is a person appointed by the Commission to administer the financial affairs of a pensioner who may be incapable of managing their own affairs for reasons such as:
- ill health, or
These criteria include circumstances where a pensioner has a psychiatric disorder or a mental illness as a result of alcohol or drug addiction.
A trustee can be appointed, with or without the consent of the pensioner and once appointed, a trustee has full control of the pension payment.
(ii) a person responsible for administration of a trust
According to section 52ZO of the VEA, trustee has the same meaning as in the Income Tax Assessment Act 1997.
Remote area allowance is a supplementary payment added to the rate of income support pension where the pensioner's usual place of residence is situated in a remote area, and where the pensioner is physically present in the remote area.
The information below is for historical reference only.
Defence Force Income Support Allowance (DFISA) ceased on 1 January 2022 because adjusted disability income became exempt income under the Social Security Act 1991. It was an income support payment paid by DVA to people whose income support payment under Social Security Law was reduced, or not payable, because of the impact of adjusted disability pension. DFISA was the difference between the person's existing entitlement, and what the entitlement would have been had adjusted DP been exempt, but was assessed in the calculation of rent assistance.