What are the SRDP and PI letters of offer and how do they affect veterans?
DVA has defined the SRDP as “an alternative form of periodic compensation (instead of incapacity payments) for people whose capacity for work has been severely restricted because of conditions due to military service on or after 1 July 2004. SRDP is not automatically granted. If you are assessed as being eligible for the SRDP, you will be offered the choice between commencing SRDP or continuing to receive incapacity payments.”
For many veterans, when they receive a letter of offer to move to the SRDP, it can be confusing. What are the eligibility criteria and why would a veteran be offered an SRDP?
Veterans who find themselves receiving Incapacity Payments may be assessed over time to receive the SRDP.
Incapacity payments are taxed and will normally continue until the veteran reaches the required age for the Age Pension or they make the choice to move the SRDP. The criteria for accessing SRDP are based on:
When a veteran becomes eligible for the SRDP, they will receive a letter from DVA with the terms of the offer, and from the date of the letter, they will have 12 months to decide whether to accept.
This is why it is mandated that veterans seek out financial advice before they accept the offer of SRDP.
The SRDP offer, even if a veteran decides not to accept the SRDP offer it comes with access to the DVA Gold Card. This means that a veteran will be entitled to the benefits that come with a Gold Card including;
All of these entitlements are to help veterans with their daily life and to manage their injuries and the ongoing effects of their service.
As part of the SRDP-eligible, dependent children will be able to access education assistance through the Military Rehabilitation and Compensation Act Education and Training Scheme.
SRDP is a tax-free payment indefinitely, whereas incapacity payments generally cease in line with the Age Pension. However for some veterans, due to the offsetting arrangement, the SRDP payment amount may be less than the normal entitlement to incapacity payments.
This can make the choice to access the SRDP a challenging one for veterans. As each circumstance is widely varied, it is vital to access a financial advisor who can help you in plain English understand the lasting impact of accessing the SRDP payment.
Here is where VBA Wealth can help. We have a team of advisors who can assist with understanding your entitlements and how your ongoing finances will be impacted by acceptance of the SRDP offer.
So, if you’ve received an offer of accessing SRDP and you’re feeling a bit lost we encourage you to fill out the form below to receive more information and get a full understanding of what to do next!