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

Avoid paying back subsidy

There is the potential for subsidy to be overpaid, due to a range of circumstances. If you receive an overpayment of subsidy you are required to pay it back in full, even if by the time you are notified your DHOAS home loan has been closed.

For this reason, it is very important that you notify DVA as early as possible of any changes in status to your service, home loan, property or personal circumstances. You can use the Change of Circumstances form to report these changes.

If an unreported situation continues for a considerable period of time, there is the potential for you to become responsible for repaying to DHOAS a substantial amount of money. There are no options to seek exemption from repaying this outstanding amount.

If you are a Reservist, you need to be mindful of the impacts of ineffective serviceand being deemed separated for the financial year if you have not completed at least 20 days of paid Reserve service. This will result in your tier level being restrospectively reduced to tier 1 for that financial year if you have not served for 20 or more years. Even if you have closed your DHOAS home loan, you are still required to pay back any excess subsidy you received during the year you were deemed separated.

If you are uncertain about how changes will affect your DHOAS subsidy, please contact DHOAS to discuss potential impacts.

In the event of an overpayment, you will be contacted by DHOAS and given options for making the repayment.

If the outstanding amount is not paid within fourteen days of your notice from DHOAS, it becomes subject to interest charges, in accordance with Section 67 of the DHOAS Act. The interest is calculated daily on the unpaid amount using the Australian Tax Office’s General Interest Charge rate.


Reasons for overpayments

  • A lag in reporting about your separation from the ADF and dropping to a tier 1 because you have not completed 20 or more years of effective service at the time you separated. This can result in an overpayment if you're receiving payments at a higher tier. For Reservists to avoid overpayment, they should advise DHOAS as soon as possible if they believe they will not complete effective service within the financial year. See:  Important Information – Reserve Service
  • An inability to meet the Scheme conditions, including not living in the subsidised home as your principle place of residence for 12 months from the date that your subsidy payments commence. 
  • An error in the reporting of your home loan details, which results in your subsidy being calculated on an incorrect amount. 
  • An error in the reporting of details about DHOAS-eligible partners on the same home loan. This may result in an overpayment for one of the partners, and a corresponding underpayment for the other partner. 
  • An administrative error.


Repaying subsidy to DHOAS

If you are required to repay an overpayment, a DHOAS representative will contact you to discuss the options available to you.

Options for repayment include the following:

1. Post a cheque payable to DHOAS to the address below. Please write your name on the back of the cheque or attach the cheque to a letter containing your details.

GPO Box 9998
Brisbane QLD 4001

2. Using online banking, electronically transfer the funds directly into our Reserve Bank account, using the following details.

BSB 092-009
Account number 118881
Transaction reference: Your name

Please contact DHOAS if have any questions or concerns about an overpayment of your subsidy.

Depending on the amount you need to repay, another option may include DHOAS withdrawing the amount from your future subsidy payments. This is only possible if you are currently in receipt of subsidy, and you continue to have a valid DHOAS home loan and sufficient service credit.

Please note: DVA may also recover the funds directly from your DHOAS home loan account, under Section 68 of the DHOAS Act.


Caution: Loan changes can cease payments 

Making changes to your DHOAS home loan, can result in subsidy payments ceasing. These may include the following:

  • Refinancing to carry out renovations;
  • Increasing the loan amount;
  • Paying the loan to a nil or credit balance (even if the loan account remains open, or you immediately redraw the funds);
  • Adding or removing a co-borrower, etc.

To have your payments restarted, you will need to reapply to DHOAS for a subsidy certificate and your eligibility and entitlement will be assessed based on the legislation, regulations and policy applicable at the time of your application. This includes an assessment of the new purpose of the loan amount as the original intent is deemed to have changed.

If eligible, your subsidy certificate will be sent to you and you take it to your Home Loan Provider who will report your updated DHOAS home loan details to DVA.

You will also be required to restart the occupancy requirements, making the home your principle place of residence for 12 months. This is regardless of how long you have previously lived in the property.

You need to be cautious before you make any change to your home loan and consider the implications on your DHOAS subsidy. It is recommended that you first speak to DHOAS about your plans.

If you do not have access to another subsidy certificate, because you are separated, you will be unable to have your subsidy restarted.


Reporting Requirements 

The requirements of Section 84B of the Defence Home Ownership Assistance Scheme Act 2008, require that information is published on the total amount of overpayments that were incurred in a relevant reporting period. 

This information can be found here.