This section contains information on the criteria for application of the financial hardship rules:
Last updated: 12 November 2007
VEA ? [3]
Hardship provisions can apply to people who either:
The following conditions must also be met before hardship provisions can apply:
A crisis payment [4] is a one off non-taxable payment to extend assistance to people who are in severe financial hardship and who:
The payment is designed to assist in the establishment of a new residence or to re-establish a current residence after domestic or family violence has occurred.
More ? [7]
Assets reduced rate is the amount calculated when the reduction for assets is subtracted from the maximum payment rate. See SCH6-A1(2) [17] of VEA (Method Statement 1 Step 8) and SCH6-A1(6) [17] of VEA (Method Statement 5 Step 8).
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.
One element of the means test for income support pensions whereby the rate of pension payable to a pensioner reduces progressively as their assets increase above a certain threshold known as the assets value limit (AVL). [18]
An asset of a person is an unrealisable asset if:
A crisis payment is a one-off non-taxable payment to extend immediate financial assistance to people in severe financial hardship who:
Last amended: 24 July 2007
VEA ? [20]
Access to the financial hardship rules is denied to people who have:
for less than adequate financial consideration [4], unless the Commission [4] makes a written determination to disregard the disposal provisions for hardship purposes.
More ? [21]
VEA ? [22]
Situations where it may be appropriate to disregard the application of the disposal provisions for hardship purposes include:
If a person disposed of income of $4,000, and had only $1,000 left in available funds, they would still be considered to have satisfied the test of severe financial hardship if the gifting had not occurred. The discretion could then be exercised in favour of the applicant because the severe financial hardship would not be considered to be a direct consequence of the disposal.
If a person disposed of realisable assets worth $25,000 and still had $5,000 in readily available funds, the severe financial hardship would be considered a direct consequence of the disposal and the disposal provisions would not be disregarded.
VEA ? [23]
Where the disposal provisions are disregarded, the pension rate under the hardship rules is determined on the basis that the person still has the disposed income or the deprived asset [4]. Notional income may be assessed against the asset.
More ? [24]
If there is a disposition of assets on or after 1 July 2002, the rolling period is the period comprising the tax year in which the relevant disposition took place and such (if any) of the 4 previous tax years as occurred after 30 June 2002. This means that disposals that occurred prior to 1 July 2002 are not counted in the rolling period. Subsection 52JB(4) VEA [31] (for individuals) and subsection 52JD(6) VEA [31] (for members of a couple) define the rolling period relevant to the $30,000 disposal of assets 'free area' rule.
For adequate financial consideration to be received when disposing of an asset [4], a person must receive value in the form of money or assets. Adequate financial consideration can be accepted when the amounts received reasonably equate to the market value of the asset. It may be necessary to obtain a valuation from a property valuation service provider.
When disposing of income [4], in order for adequate financial consideration to be received, the person must receive money, goods or services which approximate in value to the rate of disposed income. If a person disposes of an income producing asset and receives adequate financial consideration in money or money's worth for the asset, then it can be accepted that they have received adequate financial consideration for the disposal of both the income and the asset.
According to Section 179 [31]of the VEA [31], the Commission is a body corporate under the name of Repatriation Commission.
A deprived asset is an asset:
Links
[1] https://clik.dva.gov.au/user/login?destination=node/16843%23comment-form
[2] https://clik.dva.gov.au/user/login?destination=node/16897%23comment-form
[3] https://clik.dva.gov.au/book/export/html/16843#tgt-cspol_part3_ftn280
[4] https://clik.dva.gov.au/%23
[5] https://clik.dva.gov.au/book/export/html/16843#tgt-cspol_part3_ftn281
[6] https://clik.dva.gov.au/book/export/html/16843#tgt-cspol_part3_ftn282
[7] https://clik.dva.gov.au/book/export/html/16843#tgt-cspol_part3_ftn283
[8] https://clik.dva.gov.au/service-eligibility-assistant-updates/all-determinations-order-date-signed-oldest-most-recent/determinations-under-vea
[9] https://clik.dva.gov.au/book/export/html/16843#ref-cspol_part3_ftn280
[10] https://clik.dva.gov.au/compensation-and-support-policy-library/part-9-principles-determining-pension-rate/91-income-and-assets-test-principles/913-income-and-assets-tests/assets-test
[11] https://clik.dva.gov.au/book/export/html/16843#ref-cspol_part3_ftn281
[12] https://clik.dva.gov.au/compensation-and-support-policy-library/part-9-principles-determining-pension-rate/96-deprivation-income-and-assets
[13] https://clik.dva.gov.au/compensation-and-support-policy-library/part-3-income-support-eligibility/310-financial-hardship/3103-lodging-claim-under-financial-hardship-provisions
[14] https://clik.dva.gov.au/book/export/html/16843#ref-cspol_part3_ftn282
[15] https://clik.dva.gov.au/compensation-and-support-policy-library/part-3-income-support-eligibility/312-crisis-payment
[16] https://clik.dva.gov.au/book/export/html/16843#ref-cspol_part3_ftn283
[17] http://www.comlaw.gov.au/Series/C2004A03268
[18] http://clik.dva.gov.au/glossary/assets-value-limit-avl
[19] https://clik.dva.gov.au/user/login?destination=node/16870%23comment-form
[20] https://clik.dva.gov.au/book/export/html/16843#tgt-cspol_part3_ftn284
[21] https://clik.dva.gov.au/book/export/html/16843#tgt-cspol_part3_ftn285
[22] https://clik.dva.gov.au/book/export/html/16843#tgt-cspol_part3_ftn286
[23] https://clik.dva.gov.au/book/export/html/16843#tgt-cspol_part3_ftn287
[24] https://clik.dva.gov.au/book/export/html/16843#tgt-cspol_part3_ftn288
[25] https://clik.dva.gov.au/book/export/html/16843#ref-cspol_part3_ftn284
[26] https://clik.dva.gov.au/book/export/html/16843#ref-cspol_part3_ftn285
[27] https://clik.dva.gov.au/book/export/html/16843#ref-cspol_part3_ftn286
[28] https://clik.dva.gov.au/book/export/html/16843#ref-cspol_part3_ftn287
[29] https://clik.dva.gov.au/compensation-and-support-policy-library/part-3-income-support-eligibility/310-financial-hardship/3106-rate-calculation-under-hardship-provisions
[30] https://clik.dva.gov.au/book/export/html/16843#ref-cspol_part3_ftn288
[31] http://clik.dva.gov.au/legislation-library