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5.4.5 Review of Pension Loans Scheme

Last amended 
25 June 2015
Change in pension entitlement

Where changes in income, assets or pension entitlement occur as a result of a DVA or pensioner initiated review, the amount of the loan payments may need to be recalculated i to ensure that the total of the PLS payment and any actual pension entitlement does not exceed 150% of the maximum payment rate and that the PLS rate is consistent with the person's choice on how to set the PLS rate.

Recalculation of loan payments is not required for pensioners who chose to receive a set rate as a loan subject to the total of their PLS rate plus their new rate of pension does not exceed 150% of the maximum rate payable.    

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Change to nominated amount




A request to change the nominated amount or withdraw from the pension loans scheme can be made at any time to DVA in writing and must be signed by the veteran and, if they are a member if a couple, their partner.

A request to increase the nominated amount is subject to the pensioner remaining under the maximum loan applicable to their circumstances. An increase in the nominated amount requires a re-assessment of the pension loan to ensure that the assets on which the charge is placed are still sufficient. This may require a re-valuation of assets by a property valuation service provider.

Revaluation of property/asset

Valuation of the real estate used as security on a pension loans scheme loan is conducted at the time of grant and each year following the grant. Property valuations are done by a property valuation service provider at no cost to the client.

If any changes are made that may impact on the value of the property, a revaluation may be required. For example, the creation of an easement, that limits the way part of the property can be used, will require a revaluation by a property valuation service provider.

A check should be made after each revaluation to ensure that the pension loans scheme recipient has not exceeded their maximum loan and is still entitled to ongoing pension loans scheme payments.    

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Pensioner becomes a member of a couple

If a pensioner becomes a member of a couple, a review based on the new circumstances is necessary to establish continued entitlement to any payment of pension under pension loans scheme. Payment under pension loans scheme is suspended until the new member of a couple signs a Pension Loans Application. The suspension is lifted and payment resumed to one or both members of the couple if continuing eligibility is established and a new application form is signed by both members of the couple (even if the partner is not accessing the scheme).

Separation of a couple

If a couple with a debt under pension loans scheme separate, the pension loan should be suspended until a full review of the pensioner's circumstances is completed. The review needs to establish:

  • whether any asset securing a debt is affected by any property settlement,
  • what impact this may have on continuing eligibility for payment under the pension loans scheme, and
  • what impact this has on recovery of the debt.

if the separation is permanent, and one member of the couple is no longer entitled to receive payments under the PLS, the debt owed by that person may be recovered in part or in full:

  • when property settlement occur, or
  • at an appropriate time dependanr in the circumstances of the case.  

Example: A person who no longer qualifies becuase they are under pension age or have insufficent assets to secure the debt.

If the separation is permanent and both people wish to continue in the scheme, then each member of the couple will need to qualify for payments under the PLS in their own right.

Relocation of a separated couple

If the pensioner or pensioners decide to relocate and their principal residence is the secured asset, the person's entitlement must be reassessed to decide whether it is appropriate to allow transfer of the charge to the new property. This depends on the value of the new property offered as security. There must not be a time gap between the sale of the old property and the purchase of the new property. Effectively, the old debt is recovered and a new assessment is done using the new property as security.


Portability of payments under pension loans scheme

Payments under the PLS are not directly affected by portability rules.  However, for PLS participants living outside Australia, the portability provisions may reduce the maximum payment rate under the rate calculators, which may result in a lower maximum fortnightly PLS rate being available than to PLS participants living in Australia.

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Portability of service pension and income support supplement

Chapter 11.4 Portability of Pensions and Allowances


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Calculation of the maximum loan available

5.4.4/Calculation of Pension Loan


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Portability of service pension and income support supplement

Chapter 11.4 Portability of Pensions and Allowances


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The Department of Veterans' Affairs.