﻿ Calculating the Rate of Rent Assistance Payable | Compensation and Support Policy Library, Part 5 Income Support Allowances and Benefits, 5.1 Rent Assistance, 5.1.3 Payment of Rent Assistance

# Calculating the Rate of Rent Assistance Payable

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##### Rent assistance payable

VEA ?

The following factors affect the rate of rent assistance payable:

##### Calculating the rate of rent assistance

VEA ?

The amount of rent assistance payable is determined using the rent assistance module of the pension rate calculator appropriate to the person's family situation. This means that for every dollar of rent paid in excess of the relevant rent threshold, 75 cents of rent assistance is paid up to the applicable maximum rate. The rent thresholds and maximum rates of rent assistance are adjusted twice yearly in March and September in line with movement in the cost of living.

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##### Example of rent assistance calculation for a single assessment

VEA ?

A single pensioner is paying \$200.00 per fortnight in rent as at 15 April 2005. The rent threshold for a single pensioner as at 15 April 2005 is \$87.00 and the maximum rate payable \$98.00. For every \$1.00 of rent paid over the threshold of \$87.00, the pensioner will receive 75 cents of rent assistance up to a maximum of \$98.00. This is calculated as follows:

\$200.00 (rent) – \$87.00 (threshold) x 0.75 = \$84.75

As the rate calculated is less than the maximum rate of \$98.00, the single pensioner will receive \$84.75 per fortnight in rent assistance.

Note: If the pensioner receives disability income, the rate of rent assistance could be reduced under the disability income rent test.

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##### Example of rent assistance calculation for a partnered assessment

VEA ?

A couple is paying a total of \$250.00 per fortnight in rent as at 15 April 2005. The combined rent threshold for a partnered assessment as at 15 April 2005 is \$141.80 and the maximum combined rate payable \$92.40 (or \$46.20 each). For every \$1.00 of rent paid over the threshold of \$141.80, the couple will receive 75 cents of rent assistance between them (or 37.5 cents each) up to the maximum rate. For each member of the couple, this equals:

\$250.00 (total rent) – \$141.80 (combined threshold) x 0.375 = \$40.575

As the rate calculated is less than the maximum rate of \$46.20 each, each member of the couple will receive \$40.575, which rounds up to \$40.58 each per fortnight in rent assistance.

Note: If either member of the couple receives disability income, the rate of rent assistance could be reduced under the disability income rent test.

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##### Impact of ceiling rate on rent assistance

Where a war widow/widower in receipt of ISS or SP is eligible for rent assistance, from 1 January 2005 this is paid in addition to the ISS or SP ceiling rate, or if the person's rate of SP or ISS is less than the ceiling rate, in addition to that rate.

##### Payment of rent assistance where pensioner has saved children

If a war widow/widower in receipt of ISS has saved children, any rent assistance payable, as well as dependent child add-on and guardian allowance, is added to the ceiling rate to calculate the rate of ISS.

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##### Rate of rent assistance payable to pensioner whose partner is not receiving a rent increased pension

Subject to the amount of rent paid or payable and any disability income received, a pensioner whose partner is not receiving a rent increased pension is eligible for the single rate of rent assistance.

A pensioner is the partner of a person not receiving a rent increased pension if the partner lives with the person; and either

Module C – Rent Assistance

Schedule 6, Part 2, Module C of the VEA

VEA ? (go back)

Assessing rent assistance for disability income recipients

5.1.3/Disability Income Rent Test

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Reference Library - Pension Rates

PRC/View

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Assessing rent assistance for disability income recipients

5.1.3/Disability Income Rent Test

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Assessing rent assistance for disability income recipients

5.1.3/Disability Income Rent Test

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Payments in respect of saved children

Section 9.4.4

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Rent Assistance is an allowance, which may be paid to a service pensioner or income support supplement (ISS) recipient to assist in meeting the cost of rental accommodation.

To receive rent assistance, a pensioner must be paying rent (other than Government rent) for accommodation in Australia, and the amount paid must exceed a certain threshold.

A person's 'partner' is someone who is a member of a couple with that person.

According to Schedule 6C5 of the VEA, a person has a partner with a rent increased pension, if:

• the partner is living with the person in their home; and
• the partner is receiving a service pension or social security pension; and
• either of the following applies:
• the partner is receiving a service pension the rate of which is increased to take account of rent paid or payable by the partner; or
• the partner is receiving a social security pension and is entitled to be paid family tax benefit at a rate higher than the base rathe under Part 2, Division 1, Clause 4 of Schedule 1 to the Family Assistance Act 1999.

For [glossary:service pension:DEF/Service pension/er/SP] recipients, disability income when calculating the rent assistance reduction amount (as set out in the table in [glossary:SCH6-C13 of the VEA) refers to:

• disability pension (as defined by section 5Q(1) of the VEA) including disability pension paid by foreign governments; and
• weekly permanent impairment compensation payments made under section 68, 71 or 75 of the Military Rehabilitation and Compensation Act 2004; and
• weekly amounts a person would have been paid if the person had not instead received permanent impairment compensation under section 68, 71 or 75 of the Military Rehabilitation and Compensation Act 2004 as a lump sum.

For ISS recipients, disability income when calculating the rent assistance reduction amount (as set out in the table in SCH6-C14B of the VEA) has the same meaning as adjusted disability pension.

For [glossary:service pension:DEF/Service pension/er/SP] recipients, disability income when calculating the rent assistance reduction amount (as set out in the table in [glossary:SCH6-C13 of the VEA) refers to:

• disability pension (as defined by section 5Q(1) of the VEA) including disability pension paid by foreign governments; and
• weekly permanent impairment compensation payments made under section 68, 71 or 75 of the Military Rehabilitation and Compensation Act 2004; and
• weekly amounts a person would have been paid if the person had not instead received permanent impairment compensation under section 68, 71 or 75 of the Military Rehabilitation and Compensation Act 2004 as a lump sum.

For ISS recipients, disability income when calculating the rent assistance reduction amount (as set out in the table in SCH6-C14B of the VEA) has the same meaning as adjusted disability pension.

The disability income rent test is the method of calculating the amount by which a pensioner's rent assistance is reduced because of the disability income paid to them or their patner. The amount calculated is the RA reduction amount.

RA reduction amount = disability incomerent assistance free areaX taper rate

Note: The rent assistance free area and taper rate are identical to those that normally apply to the person's [glossary:income support payment:DEF/Income support payment] and family situation.

For [glossary:service pension:DEF/Service pension/er/SP] recipients, disability income when calculating the rent assistance reduction amount (as set out in the table in [glossary:SCH6-C13 of the VEA) refers to:

• disability pension (as defined by section 5Q(1) of the VEA) including disability pension paid by foreign governments; and
• weekly permanent impairment compensation payments made under section 68, 71 or 75 of the Military Rehabilitation and Compensation Act 2004; and
• weekly amounts a person would have been paid if the person had not instead received permanent impairment compensation under section 68, 71 or 75 of the Military Rehabilitation and Compensation Act 2004 as a lump sum.

For ISS recipients, disability income when calculating the rent assistance reduction amount (as set out in the table in SCH6-C14B of the VEA) has the same meaning as adjusted disability pension.

The disability income rent test is the method of calculating the amount by which a pensioner's rent assistance is reduced because of the disability income paid to them or their patner. The amount calculated is the RA reduction amount.

RA reduction amount = disability incomerent assistance free areaX taper rate

Note: The rent assistance free area and taper rate are identical to those that normally apply to the person's [glossary:income support payment:DEF/Income support payment] and family situation.

A war widow/widower is generally a person who immediately before their partners death, was the partner of, or was legally married to:

Refer to 5E(1) of the VEA for the full definition.

The ceiling rate of service pension and income support supplement (ISS) is applied to all war widows/widowers when assessing the rate of pension. This amount was previously frozen at \$124.90 per fortnight, however, since legislation was introduced in September 2002, is now indexed twice yearly in line with percentage increases in the maximum rate service pension. A higher ceiling rate can apply, however, in the following cases:

If a person:

• became a war widow/widower-pensioner before 1 November 1986,

• has continually received service pension, social security pension or ISS since that date, and

• the rate of pension immediately before that date was more than \$120.10

in such a case the ceiling rate is equal to the pre-November 1986 rate plus 4%.

If a person:

• is a person to whom ISS is payable,

• is not permanently blind, and

• whose Part II or IV pension is [glossary:compensation reduced:DEF/Compensation reduced pension],

the ceiling rate is the sum of the ceiling rate as calculated above and the amount of the reduction in the Part II or Part IV pension. The maximum ceiling rate cannot exceed the maximum rate of single service pension. For ceiling rates refer to SCH6-A4 to A9 of VEA. The amount of increase to the ceiling rate pension under Part II or Part IV is worked out by using the formula in SCH6-A9 of the VEA.

From 1 January 1998 responsibility for administration of most income support child related payments was transferred to  Centrelink. However, saving provisions allow any person in receipt of service pension or income support supplement on 31 December 1997 who would be or is financially disadvantaged by the transfer to continue having their child related payments paid by DVA. Saved children are assessed under the rules contained in the VEA as at 31 December 1997.

Dependent child add-on is an amount which is included in a person's service pension or ISS where that person has saved children.

Guardian allowance is included in the calculation of a person's service pension or ISS where that person has a saved child and where that person is either not a member of a couple or is a illness separated couple or respite care couple.

For [glossary:service pension:DEF/Service pension/er/SP] recipients, disability income when calculating the rent assistance reduction amount (as set out in the table in [glossary:SCH6-C13 of the VEA) refers to:

• disability pension (as defined by section 5Q(1) of the VEA) including disability pension paid by foreign governments; and
• weekly permanent impairment compensation payments made under section 68, 71 or 75 of the Military Rehabilitation and Compensation Act 2004; and
• weekly amounts a person would have been paid if the person had not instead received permanent impairment compensation under section 68, 71 or 75 of the Military Rehabilitation and Compensation Act 2004 as a lump sum.

For ISS recipients, disability income when calculating the rent assistance reduction amount (as set out in the table in SCH6-C14B of the VEA) has the same meaning as adjusted disability pension.

According to Schedule 6C5 of the VEA, a person has a partner with a rent increased pension, if:

• the partner is living with the person in their home; and
• the partner is receiving a service pension or social security pension; and
• either of the following applies:
• the partner is receiving a service pension the rate of which is increased to take account of rent paid or payable by the partner; or
• the partner is receiving a social security pension and is entitled to be paid family tax benefit at a rate higher than the base rathe under Part 2, Division 1, Clause 4 of Schedule 1 to the Family Assistance Act 1999.

A service pension is an income support payment broadly equivalent to the social security age and disability support pensions. It may be paid once a veteran or partner has reached the nominated age or is incapacitated for work.

ISS is an income support payment that may be paid to eligible war widows and widowers under the VEA and persons receiving wholly dependent partners' compensation under the MRCA, and who satisfy the means tests. It is an indexed rate, increased twice-yearly in March and September in line with changes to the cost of living and/or average wages. Income Support Supplement (ISS) legislation commenced on 20 March 1995. It is a payment created to replace the ceiling rate income support age, carer, wife and disability support pensions, paid to war widows/widowers by Centrelink.

The term social security pension is defined in Section 5Q(1) VEA to mean:

• age pension;
• disability support pension;
• wife pension;
• carer payment;
• pension PP (single);
• sole parent pension;
• bereavement allowance;
• widow B pension;
• mature age partner allowance;
• special needs pension.

As benefits (pensions) may change, for the most current definition access this link to the Social Security Act 1991

http://www.comlaw.gov.au/comlaw/management.nsf/lookupindexpagesbyid/IP200401781?OpenDocument