Compensation offsetting is the process of reducing one compensation payment in recognition of another compensation payment for the same incapacity or death. The underlying principle behind these provisions is that a person should not be compensated twice for the same incapacity, when a person in a similar circumstance can only receive one source of compensation if only eligible from that source. Generally this principle applies to any award of compensation or damages from another source contributing to the same incapacity, for which Disability Compensation Payment is being paid, or the death for which war widow(er)'s pension is paid. In this situation a corresponding reduction or offset is calculated and applied to the Disability Compensation Payment or war widow(er)'s pension to prevent double compensation. A person should not receive dual compensation for an injury, disease or death simply because they have additional eligibility from another source.
These guidelines explain the policy and procedures when offsetting particular payments made under Parts II and IV of the Veterans' Entitlements Act 1986 (VEA). The authority for these guidelines are contained in the following sections of the VEA:
- Sections 30A to 30P of Division 5A in Part II
- Sections 74 to 79 of Division 4 in Part IV
- Section 25A of Division 4 in Part II