Review Indicates Possible Overpayment Prior to Bereavement

Last amended: 19 April 2011

Comparing income and assets before and after bereavement

When processing a review following bereavement, compare the income and assets declared prior to the bereavement to those declared in the review. If there is a discrepancy, this may indicate that income and assets had been under-declared prior to death, or may be under-declared in the end of bereavement review. Where income and assets declared in the end of bereavement review are significantly less than those declared by the couple prior to bereavement, investigate whether income and assets have been distributed to other parties from the estate or are being under-declared.    

Does an overpayment exist prior to bereavement

The following table illustrates when an overpayment may or may not exist for the period before single obligations started to apply.

Example of reduction caused by changes to applicable limits

The following example illustrates a reduction caused by the change from partnered to single limits:

• the assessment prior to the death was maximum partnered rate,
• obligations were to advise when income exceeded the partnered [glossary:ordinary/adjusted income:] [glossary:fee area:] (OIFA),
• $40,000 held as financial assets, generating deemed income of approximately $46 per fortnight,
• partner dies,
• single OIFA and AVL limits apply to surviving partner from the day after the end of the bereavement period or the time notified of their new obligations, whichever is the later,
• end of bereavement review shows financial assets total $125,000, generating deemed income of approximately $210 per fortnight, and
• the current level of deemed income reduces the single rate of pension to below the maximum rate.

Has an overpayment occurred while partnered obligations applied

In the example used, establish the reasons for the increase to the level of financial assets, if not clear from the review. This is to rule out the possibility that specific obligations have not been met, such as the sale of a home, receipt of compensation, or cashing in of a life insurance policy. Assuming all other obligations are met, apply the married income and assets tests and if the couple would still have received the maximum rate of pension, no further investigation is required. Deemed income of approximately $210 per fortnight, generated from financial assets of $125,000, is below the partnered income free area. Therefore, no overpayment occurs before the date the person is informed of their new obligations, or the day after the end of the bereavement period, whichever is the later.