Australian Government - Department of Defence - Department of Veteran's Affairs

Service credit


You can be paid a DHOAS subsidy payment into an eligible DHOAS home loan for as long as you have a service credit (and you meet the Scheme conditions). Key points include:

  • A DHOAS service credit is accrued by completing effective ADF service.
  • You start accruing your DHOAS service credit after you complete your qualifying period, that is four years of Permanent service or eight years of Reserve service.
  • You can accrue a DHOAS service credit up to a maximum of 20 years or up to 25 years with warlike service.

 

When credit is accrued

Once both Permanent and Reserve members have completed their qualifying periods, they accrue the same amount of service credit for the length of service they undertake. That is, they each accrue one year of entitlement to DHOAS for every year of effective service they complete. However, they accrue the service at different times.

If you are a Permanent member, you accrue:

One month of entitlement for every month of effective service that you complete after your qualifying period of four years. If you have served for four years and one month, you will have one month of DHOAS service credit. You need at least one month of service credit (preferably two months to cover any administration requirements) before you can access a Subsidy Certificate and start receiving subsidy payments into your DHOAS home loan.

If you are a Reservist, you accrue:

One year of entitlement for every financial year of effective Reserve service you complete after qualifying. That is, if you have served as a Reservist for nine effective years, you will have one year of DHOAS service credit. You need at least one year of service credit (accrued when you complete one year of effective Reserve service after your eight year DHOAS qualifying period) before you can access a Subsidy Certificate and start receiving subsidy payments into your DHOAS home loan.  

“Effective” Reserve service involves undertaking at least 20 days of paid service within the financial year, including at least one day of paid Reserve service with the remainder made up of either further paid Reserve service, CFTS or Permanent service.

Subject to DVA being notified, you accrue the service credit once the effective service is completed, whenever that is in the financial year. For example, if you complete 20 days of paid Reserve service by 30 August, that’s when you receive credit for one year of service. Please note that DHOAS subsidy cannot be paid in advance of a Reservist completing the effective service, on the assumption that this will occur.

If you wish to have your additional year of entitlement recognised before the end of the current financial year (for example, if you are due to progress to a higher tier, or your service credit is due to be exhausted), please notify DHOAS using a Change of Circumstances form when you have completed your 20 days of Reserve service.

If you are a lateral recruit:

If you were in the Defence Force of another country before joining the ADF you may be eligible for the DHOAS, from the date you became an ADF member. That is, you won’t have to complete the qualifying period of service. However, only your period of service in the ADF contributes to your entitlement to DHOAS subsidy.

 

Calculating service credit

Overall, for both Permanent and Reserve members, to work out your service credit and the indicative period of time you can receive the DHOAS subsidy, you add up:

  • Your total years of ADF service; plus 
  • Additional years gained from completing warlike service (see below: Credit for warlike service)

Then you subtract ...

  • Your qualifying period; 
  • Any period of time you have already accessed DHOAS as well as subsidy from older schemes, the Defence Service Homes (DSH) or the Defence HomeOwner Scheme (DHOS);
  • Breaks in service after finishing your qualifying period which have paused your accrual in entitlement; 
  • Any years of ADF service that aren't recognised as a result of rejoining provisions

You can accrue a maximum, combined entitlement to DHOAS, DHOS and DSH of up to 20 years without warlike service or up to 25 years with warlike service.

Please note: Whether you are able to access all of your accrued entitlement to DHOAS will depend on whether you continue to have an eligible DHOAS home loan into which your subsidy can be paid and you meet the conditions of the scheme.

 

Credit for warlike service 

If you have provided warlike service you will be entitled to additional periods of subsidy assistance, extending your service credit as set out in the following table.

The maximum period that you can receive Defence home loan subsidies from DHOAS, DHOS and DSH combined, with the extra entitlement from your warlike service, is up to a maximum of 25 years.

Period of warlike service* Additional Service Credit
Not more than 3 months** 2 years
More than 3 but not more than 6 months 3 years
More than 6 but not more than 9 months 4 years
More than 9 months  5 years

* Any time spent on out-of-country leave during your warlike service does not count towards the warlike service bonus period.

** Definition of a 'month': A 'calendar month' (as defined by the Act Interpretation Act 1901) means a period that meets both these criteria:

a. It starts at the beginning of a day of a month
b. It ends at either of these times:

i. immediately before the beginning of the corresponding day of the next month
ii. if there is no corresponding day in the next month - at the end of the next month.
Example: 12 May 2000 - 11 June 2000; 30 January 2005 - 28 February 2005

The additional entitlement you accrue due to your warlike service extends the period of time that you can receive a subsidy on your DHOAS home loan. It can also be used to convert available entitlement into a lump sum, up to a maximum of four years.

However, warlike service will not fast-track your qualifying period. Nor will it fast-track you to a higher subsidy tier level. You still need to complete the minimum years of effective service required to be eligible for a higher subsidy tier.

Warlike service example – Permanent member

A member of the Permanent ADF has completed three years of service in total. This includes more than nine months of warlike service. Although you have undertaken warlike service, this does not extend your qualifying period. You still have one more year of service to complete your four year qualifying period.

However, once you have completed the four year qualifying period, you will have a five year DHOAS service credit, accrued as a result of your warlike service. As of then, you can start accessing subsidy on a DHOAS home loan for five years (and for longer if you keep serving in the ADF and accruing DHOAS entitlement).

Warlike service example – Reservist

A Reservist has completed three years of service in total. This includes 12 months of warlike service. Although you have undertaken warlike service, this does not fast track your qualifying period. You still have to complete your eight year qualifying period.

However, you have done 12 months of CFTS which is counted as double towards the eight year period. For example, you did 12 months of CFTS and this contributes two years towards your eight year qualifying period. Therefore, you have so far completed four years of service towards your eight year qualifying period. You have four more years to go.

Once you have completed the qualifying period, you will immediately gain a five year DHOAS service credit, accrued as a result of your warlike service. As of then, you can start accessing subsidy on a DHOAS home loan for five years (and for longer if you keep serving in the ADF and accruing DHOAS entitlement).

 

Access to previous subsidy schemes

To work out your DHOAS service credit, in addition to subtracting your qualifying period from the total number of years you have served, you also subtract the number of years you have previously accessed other Defence home loan subsidies.

This includes subsidy already received from DHOAS as well as subsidy from earlier schemes, the Defence HomeOwner Scheme (DHOS) and Defence Service Homes (DSH).

For example, you have served for a total of 20 years in the Permanent Force. You subtract your four year qualifying period, leaving 16 years of DHOAS service credit. If you have already accessed the DHOS for six years, you also subtract this amount. This means you will have a service credit of 10 years remaining to access DHOAS.

 

Examples of DHOAS service credit

Permanent member

You are a member of the Permanent ADF, and you have completed 10 years and two months of effective service.

To work out your accrued entitlement, or service credit, you first take your total period of effective ADF service (10 years, two months).

Then you add the credit for your warlike service. You have completed more than three months but less than six months of warlike service. This means you can add an additional three years to your service credit, taking it up to 13 years and two months.

From this, you subtract your qualifying period of four years. This means your service credit, as of today, is nine years and two months.

However, you have already received payments under the earlier home loan subsidy scheme DHOS for two years. You would subtract this time from your entitlement period. This means, as of today, you have seven years and two months of entitlement to DHOAS.

Reservist 

You are currently a Reservist, and you have completed 14 years of effective Reserve service. Within this time you had one year of ineffective service because you did not complete 20 days of paid Reserve service within the financial year.

To work out your accrued entitlement, or service credit, you take your total period of effective service. This is 13 years, as you do not accrue entitlement for the year you did not complete effective service.

In addition, you have completed more than three months but less than six months of warlike service. This means you can add an extra three years towards your service credit, taking it up to 16 years.

From this, you subtract your qualifying period of eight years. This means your service credit is eight years.

However, you have already received payments under the earlier home loan subsidy scheme DHOS for two years. You also subtract this time from your total years of service. This means, as of today, you have six years of entitlement to DHOAS. 

Combined Permanent and Reserve service

You have completed six years of Permanent service. Prior to this service, you completed 10 years of effective service in the Reserves.

To work out your accrued entitlement to DHOAS, or service credit, you first need to subtract your qualifying period from your total years of service. Your qualifying period of eight years as a Reservist will be subtracted from your first 10 years in the Reserves. This will leave you with an eight year service credit (six years in the Permanent Force and the remaining two years in the Reserves).

In addition, you have completed more than six months but less than nine months of warlike service. This means you can add an additional four years to your service credit, taking it up to 12 years.

However, you have already received payments under the earlier home loan subsidy scheme DHOS for two years. You also subtract this time from your total years of service. This means, as of today, you have 10 years of entitlement to DHOAS.

** Please note: For further information about working out your qualifying period using combined Permanent and Reserve service years, please see qualifying period

Maximum service credit

The maximum entitlement to subsidy from the DHOAS, DHOS and DSH schemes combined is 20 years without warlike service and up to 25 years with warlike service.

 

Service credit is not a guarantee of DHOAS benefit

A DHOAS service credit is indicative only and cannot be seen as a guarantee of benefits that will be paid to you for a certain length of time into the future, regardless of your circumstances. This is because the period of time you can receive DHOAS assistance also relies on you meeting certain conditions, such as having a DHOAS home loan into which the subsidy can be paid.

For example, you have a 10 year service credit but you close your DHOAS home loan after two years of subsidy. You cannot access the other eight years of entitlement unless you apply for another subsidy certificate, take out another DHOAS home loan and meet all other conditions, including the 12 month occupancy requirement. If you cannot do this then you do not have a claim to DHOAS entitlement.

 


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