Changes to DHOAS & ADF Super
23rd October, 2020
Changes to Defence Home Ownership Assistance Scheme
Changes to the DHOAS eligibility criteria, effective 22 June 2020, extend the time frame for ADF members transitioning to civilian life to access the scheme from two to five years. The changes are designed to ensure that members who leave the ADF and re-join within five years will also retain all service credit accrued prior to their break in service.
DHOAS is administered on behalf of Defence by the Department of Veterans Affairs. The customer service team can be contacted on 1300 434 627 or go to dhoas.gov.au for details of the changes.
The following table (sourced from the DHOAS website) illustrates the levels of subsidy for 2020-21 available to applicants who meet the Scheme’s conditions:
| Subsidy tier |
Minimum Permanent service |
Minimum Reserve service |
Subsidised loan amount |
Maximum monthly subsidy* |
| 1 |
4 years |
8 years |
$300,243 |
Up to $206 |
| 2 |
8 years |
12 years |
$450,365 |
Up to $309 |
| 3 |
12 years |
16 years |
$600,486 |
Up to $412 |
*Estimated monthly subsidy values based on October 2020 median interest rates. These monthly subsidy values fluctuate based on changes in the median interest rate.
IMPORTANT: As with any financial transaction, it’s important to assess whether a DHOAS loan suits you and your family. Pay special attention to fees, charges and interest rates, especially if you are refinancing an existing loan. Remember, no one cares about your personal finances as much as you do.
Changes to ADF Super
ADF Super is the superannuation scheme for members who joined the ADF from 1 July 2016. It is administered by the Commonwealth Superannuation Corporation.
The government has announced changes to the rules from 6 July 2020 that will allow veterans who have had at least 12 months service to continue to use ADF Super after they leave the ADF.
This is an important and sensible change. It aligns ADF Super with much of the rest of the superannuation system where people can use their chosen superannuation fund throughout their careers.
There’s more information from the CSC on ‘Getting out? You can keep your ADF Super’.
Early Release of Superannuation – Covid-19 – Fines for False Claims
It’s been reported that the Australian Taxation Office (ATO) is “cracking down” on people who have made false claims to enable early access to up to $20,000 from their superannuation accounts (we described the Covid-19 early access scheme earlier this year).
In summary, applicants who are experiencing financial hardship (principally defined as unemployment or a reduction in work hours of at least 20%) are eligible to make the withdrawals in two instalments of up to $10,000 each.
An ATO spokesperson has advised smh.com.au that “a number of reviews are underway with individuals to confirm whether they meet the eligibility criteria”. It’s understood that the ATO is actively examining more than 5,000 applicants who may have made a false claim. If applicants knowingly make a false claim about their eligibility, penalties include a substantial fine and the taxation of the payments as normal income.
The key point from the ATO’s point of view will be to assess whether the taxpayer has made a genuine mistake or misunderstood the rules. If you are approached by the ATO, our strong recommendation is to be honest about what you understood when you made your claim.
If you are concerned about dealing with the ATO on this or any other matter, you can always appoint an accountant/registered tax agent to act on your behalf. But remember, professional advice costs money, so make sure you understand the fees up-front.
By the way, if you have made an application, you’re not alone. The Australian Prudential and Regulation Authority (APRA) figures show that at least $34 billion has already been withdrawn from Australian superannuation funds with more to come. The second instalment application date has been extended from 24 September to 31 December, 2020.
