7.4 Calculating Compensation Offsetting of Dependant's Payments | CLIK

Date amended:

10 Jul 2026

External

To calculate compensation offsetting for a widow/er follow the six steps below:

STEPS	EXAMPLE
Step 1 - Identify the dollar amount of the DVA dependant's pension paid in respect of the veteran's death. Includes W/W and children.	Step 1 - Widow B receives $758.70 war widow's pension per fortnight in respect of her husband's defence caused death.
Step 2 - Identify the fortnightly equivalent of other compensation paid, excluding Additional Death Benefits paid under Defence Act 1903.	Step 2 - Widow B received $241,556.66 lump sum which included $40 531.62 under the Defence Act in respect of the veteran's death. Compensation for offsetting purposes = $201,025.04. ($241,556.66 - $40,531.62)
Step 3 - Calculate the fortnightly equivalent of the lump sum using the AGA instructions and tables.	Step 3 - Widow B is 46 years old next birthday. The fortnightly equivalent is calculated by: 201 025.04 x 17.102 = 343.79. 10,000
Step 4 - The dependant's pension rate is compared with the fortnightly equivalent of the lump sum and the lesser is the amount by which the dependant's pension/s is offset.	Step 4 - As the fortnightly equivalent is lower than the current war widow's pension rate, the offset amount is $343.79
Step 5 - Using the preferred pensioner rules, the offset amount is manually entered into Process Direct. CPI increases this initial offset at the same time as war widows pension.	Step 5 - As Widow B is the only dependant in payment, $343.79 is manually entered into Process Direct, Disability Compensation Payment Summary Screen/PTIV indexed field against her war widow's pension.
Step 6 - Refer the file to the income support area if the dependant is in receipt of a CAP and is under pension age. If over pension age the ADB may affect the assessment of income support supplement, depending on the method of the lump sum disposal (invested or otherwise).	Step 6 - As the ADB is not offset against war widow pension it has the potential to affect the ISS assessment. Refer file to income support section.