Changes to monthly subsidy amount
There are three circumstances where the amount of your monthly subsidy payments will change:
1. Your monthly payments fluctuate based on changes to the median interest rate used to calculate DHOAS subsidy amounts.
2. You reach a service milestone and progress to a higher tier level, and...
3. You separate from the ADF and your tier level is reduced to tier 1 because you haven’t completed 20 years of effective service at the time of separation.
Your monthly subsidy amount will fluctuate up and down in line with changes to the median interest rate used to calculate your DHOAS subsidy. For more information, please see Formula for Calculating Subsidy.
If you complete a service milestone and progress to a higher subsidy tier level, you become eligible for that tier’s higher subsidised loan limit. This means your DHOAS subsidy can be calculated on a higher portion of your DHOAS home loan and you will receive a higher monthly subsidy amount.
Your subsidy will increase when you go up a tier only if your DHOAS home loan balance is higher than your current tier’s subsidised loan limit.
If it is, you can benefit from more of your loan balance attracting subsidy, up to your new subsidised loan limit. If your loan balance isn’t higher than your new subsidised loan limit, your subsidy will not increase, it will continue to be calculated on the full amount of your loan balance.
For members of the Permanent Force, DVA will progress your subsidy tier increase after you reach your service milestone, based on service reports from Defence. It is not necessary to submit any documentation to DVA to trigger your tier increase.
For Reservists, DVA will review Reservists' effective service at the end of the financial year. If you've reached the service milestone to progress a tier, DVA will amend your monthly subsidy payments from that time. No documentation needs to be submitted by members. If you complete your effective year of service (20 days of paid Reserve service) before the end of the financial year, and you're entitled to increase a tier level, you are requested to advise DVA using a Change of Circumstances form. This enables DVA to progress your tier increase at the time you advise us, instead of the end of the financial year.
If you separate from the ADF your eligible subsidy tier level may change, and your subsidy payments may be reduced.
If you separate before you complete 20 years of effective service you will be paid your DHOAS assistance at tier 1 level (even if you were entitled to a higher tier while serving).
If you complete 20 or more years of effective service before separating, you can continue to receive your subsidy payments at tier 3 level.
For further details about the impact of leaving the ADF on your DHOAS entitlement, and on accessing and using your one-only subsidy certificate post-separation, please see Separation from the ADF .
Important: Reservists need to be cautious that they do not assume they are recognised as serving members for the purpose of DHOAS when they may actually be deemed separated because they have not completed 'effective' service as defined under the Scheme. Please see: Important information - Reserve service.