Commonwealth: Defence Home Ownership Assistance Scheme Act 2008 (Cth)

Defence Home Ownership Assistance Scheme Act 2008 No. 27, 2008 Compilation No. 14 Compilation date: 14 October 2024 Includes amendments: Act No. 38, 2024 About this compilation This compilation This is a compilation of the Defence Home Ownership Assistance Scheme Act 2008 that shows the text of the law as amended and in force on 14 October 2024 (the compilation date). The notes at the end of this compilation (the endnotes) include information about amending laws and the amendment history of provisions of the compiled law. Uncommenced amendments The effect of uncommenced amendments is not shown in the text of the compiled law. Any uncommenced amendments affecting the law are accessible on the Register (www.legislation.gov.au). The details of amendments made up to, but not commenced at, the compilation date are underlined in the endnotes. For more information on any uncommenced amendments, see the Register for the compiled law. Application, saving and transitional provisions for provisions and amendments If the operation of a provision or amendment of the compiled law is affected by an application, saving or transitional provision that is not included in this compilation, details are included in the endnotes. Editorial changes For more information about any editorial changes made in this compilation, see the endnotes. Modifications If the compiled law is modified by another law, the compiled law operates as modified but the modification does not amend the text of the law. Accordingly, this compilation does not show the text of the compiled law as modified. For more information on any modifications, see the Register for the compiled law. Self‑repealing provisions If a provision of the compiled law has been repealed in accordance with a provision of the law, details are included in the endnotes. Contents Part 1—Preliminary 1 Short title 2 Commencement 3 Definitions 4 Meaning of deceased partner and surviving partner 5 When a person is a member of the Reserves 6 External Territories Part 2—Eligibility 7 Eligibility—who is eligible? 8 Eligibility—serving members 9 Eligibility—incapacitated members 10 Eligibility—rejoining incapacitated members 11 Eligibility—rejoining members 12 Eligibility—separated members 13 Eligibility—old scheme members Part 3—Subsidy certificates Division 1—Application for subsidy certificate 14 Application for subsidy certificate 15 Further information about application Division 2—Decision to give subsidy certificate 16 Decision to give subsidy certificate—general 17 Decision to give subsidy certificate—eligible applicants 18 Decision to give subsidy certificate—surviving partners 19 Decision to give subsidy certificate—loan discharged due to destruction or compulsory sale of house 20 Decision to give subsidy certificate—loan discharged due to compensable condition 21 Form of subsidy certificate Division 3—Effect of subsidy certificate 22 Period subsidy certificate in force 23 Subsidy certificate not a legislative instrument Division 4—Variation and cancellation of subsidy certificates 24 Variation of subsidy certificate 25 Cancellation of subsidy certificate Part 4—Subsidy Division 1—Entitlement to subsidy Subdivision A—General 26 Entitlement—form of subsidy 27 Entitlement—authorisation by Secretary 28 Entitlement—criteria Subdivision B—When subsidy becomes payable 29 When subsidy becomes payable—eligibility and service credits 30 When subsidy becomes payable—use of subsidised loan 31 When subsidy becomes payable—ownership and location of land 32 When subsidy becomes payable—occupation of house as a home (non‑building loan) 33 When subsidy becomes payable—use of land 34 When subsidy becomes payable—subsidy lump sum Subdivision C—When subsidy stops being payable 35 When subsidy stops being payable—scope 36 When subsidy stops being payable—general 37 When subsidy stops being payable—completion of building work 38 When subsidy stops being payable—ownership of land 39 When subsidy stops being payable—occupation of house as a home (non‑building loan) 40 When subsidy stops being payable—occupation of house as a home (building loan) 41 When subsidy stops being payable—use of land 42 When subsidy stops being payable—disclosure of changes of circumstances 43 When subsidy stops being payable—on request by the subsidised borrower Subdivision D—Revocation and variation 44 Revocation of authorisation for the payment of subsidy 45 Variation of authorisation of payment of subsidy—when a person is not a member of the Reserves Division 2—Service credits 46 Working out service credits 47 Service credits—working out accrued subsidy periods 48 Service credits—additional allowance for warlike service Division 3—Amount of subsidy Subdivision A—Monthly subsidy 49 Working out monthly subsidy 50 Monthly subsidy—average monthly interest 51 Monthly subsidy—loan capital 51A Monthly subsidy—shared liability between partners for subsidised loans 51B Monthly subsidy—shared liability between partners for subsidised loans if partner dies etc. 51C Monthly subsidy—joint and several liability for subsidised loans between non‑partners 52 Monthly subsidy—average house price 53 Monthly subsidy—median interest rate Subdivision B—Subsidy lump sum 54 Subsidy lump sum payments Division 4—How subsidy is paid 55 How subsidy is paid—scope 56 How subsidy is paid—to loan provider for the benefit of subsidised borrower 57 How subsidy is paid—monthly subsidy 58 How subsidy is paid—subsidy lump sum Division 5—Subsidy for surviving partners Subdivision A—Surviving partners of subsidised borrowers 59 Surviving partners of subsidised borrowers—scope 60 Surviving partners of subsidised borrowers—joint interests in land 61 Surviving partners of subsidised borrowers—interest in land inherited by surviving partner etc. 62 Surviving partners of subsidised borrowers—interest in land not inherited by surviving partner etc. Subdivision B—Surviving partners holding subsidy certificates 63 Subsidy for surviving partners—if they hold subsidy certificates Subdivision C—Application of this Part 64 Subsidy for surviving partners—how this Part applies 65 Subsidy for surviving partners—if surviving partner eligible in his or her own right etc. Division 6—Recovery of overpayments 66 Recovery of overpayments—scope 67 Recovery of overpayments—amount payable 68 Recovery of overpayments—from subsidised loan account 69 Recovery of overpayments—from sale of interest in land 70 Recovery of overpayments—in a court Part 5—Review of decisions Division 1—Internal review 71 Internal review—reviewable decisions 72 Internal review—persons whose interests are affected 73 Internal review—notice of reviewable decision and review rights 74 Internal review—applications for review of reviewable decisions 75 Internal review—review of reviewable decisions Division 2—External review 76 External review—review by Administrative Review Tribunal of internal review decisions Part 6—Administration 77 Approved forms 78 Declared loan providers 79 Use and disclosure of personal information 80 Delegation of Minister's power to make certain determinations 81 Delegation of Secretary's powers and functions 82 Alteration of rights 84 Appropriation 84A Payments of amounts purportedly by way of subsidy 84B Reports about payments of amounts purportedly by way of subsidy 85 Regulations Endnotes Endnote 1—About the endnotes Endnote 2—Abbreviation key Endnote 3—Legislation history Endnote 4—Amendment history An Act to establish a scheme to provide financial assistance to members of the Defence Force, and certain other persons, for the purchase, maintenance and development of their homes, and for related purposes Part 1—Preliminary 1 Short title This Act may be cited as the Defence Home Ownership Assistance Scheme Act 2008. 2 Commencement (1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms. Commencement information Column 1 Column 2 Column 3 Provision(s) Commencement Date/Details 1. Sections 1 and 2 and anything in this Act not elsewhere covered by this table The day on which this Act receives the Royal Assent. 23 June 2008 2. Sections 3 to 85 The later of: 1 July 2008 (a) the day on which this Act receives the Royal Assent; and (b) 1 July 2008. Note: This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent. (2) Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act. 3 Definitions In this Act: accrued subsidy period has the meaning given by section 47. agreement includes: (a) a deed; and (b) a memorandum of understanding between Commonwealth agencies. approved form has the meaning given by section 77. Australia includes the external Territories. authorisation day has the meaning given by section 57. authorised Commonwealth contractor has the meaning given by section 81. average house price has the meaning given by section 52. average monthly interest has the meaning given by section 50. building work, in relation to land (or in relation to a loan that relates to an interest in land), has the meaning given by paragraph 30(1)(b). commencing day means the day on which this section commences. Commonwealth agency means a non‑corporate Commonwealth entity within the meaning of the Public Governance, Performance and Accountability Act 2013. compensable condition means a condition, disease, illness or injury suffered by a person in respect of which compensation is, or has been, payable under any of the following: (a) the Safety, Rehabilitation and Compensation Act 1988; (aa) the Safety, Rehabilitation and Compensation (Defence‑related Claims) Act 1988; (b) the Veterans' Entitlements Act 1986; (c) the Military Rehabilitation and Compensation Act 2004; (d) a law of the Commonwealth prescribed by the regulations. debtor has the meaning given by section 66. deceased partner has the meaning given by section 4. Note: Partner is defined in this section. For the definition of surviving partner, see section 4. declared loan provider has the meaning given by section 78. due amount has the meaning given by section 67. effective service, in relation to a person who is, or has been, a member of the Defence Force, means service in the Defence Force by the person that: (a) if the person has, at any time before, on or after the commencing day, stopped being a member of the Defence Force, and, more than 5 years later, again become a member of the Defence Force—does not include service before the person again became a member of the Defence Force; and (b) in any case—is recognised as effective service in accordance with the regulations. eligible has the meaning given by section 7. entitlement period has the meaning given by section 28. first authorisation day, for subsidy that is payable during an entitlement period, means the first authorisation day after subsidy becomes payable for the entitlement period. Note: For the definition of authorisation day, see section 57. The authorisation day is at the end of a monthly authorisation period (as defined in section 57). Subsidy becomes payable from the beginning of the first monthly authorisation period during which section 28 starts to apply. foreign service member means a member of the Defence Force who, before he or she became a member of the Defence Force, had been a member of the armed forces of a foreign country. house means a single dwelling, including a unit that is a single dwelling, but does not include: (a) a dwelling, or unit, that is unfit for anyone to live in or that is the subject of a condemnation order; or (b) a dwelling, or unit, that is to be compulsorily acquired by: (i) the Commonwealth, a State or a Territory; or (ii) an authority (including a local governing body) established for a public purpose by or under a law of the Commonwealth, a State or a Territory; or (c) a caravan, houseboat or another kind of mobile dwelling; or (d) a flat that is not a unit. Note: Unit is also defined in this section. internal review decision has the meaning given by section 75. intestacy law means a law of, or in force in, a State or Territory that provides for the devolution of the estate of a person who dies intestate. loan capital has the meaning given by section 51. loan limit has the meaning given by section 51 (monthly subsidy—loan capital), as affected by sections 51A and 51B (liability for subsidised loans shared between partners). loan provider means a body corporate which makes (or which is to make) loans to persons in relation to which this Act applies (or is to apply). loan provider agreement, in relation to a loan provider, means the agreement entered into by the Commonwealth with the loan provider (whether before, on or after the commencing day) for the purposes of the payment of subsidy for the benefit of subsidised borrowers, as varied from time to time. median interest rate has the meaning given by section 53. monthly authorisation period has the meaning given by section 57. monthly repayment has the meaning given by section 50. monthly subsidy has the meaning given by section 49. overpaid amount has the meaning given by section 66. partner: a person is the partner of another person if the two persons have a relationship as a couple (whether the persons are different sexes or the same sex) and ordinarily live with each other on a permanent and bona fide domestic basis. Note: For the definitions of surviving partner and deceased partner, see section 4. Permanent Forces means the Permanent Navy, the Regular Army or the Permanent Air Force. Reserves means the Naval Reserve, the Army Reserve or the Air Force Reserve. reviewable decision has the meaning given by section 71. Secretary means the Secretary of the Department. service credit has the meaning given by section 46. service year means a year prescribed by regulations made for the purposes of the definition of effective service in this section. subsidised borrower means a person to whom subsidy is (or is to be) payable under Part 4. subsidised loan means a loan in relation to which subsidy is (or is to be) payable under Part 4. subsidised loan account, in relation to a subsidised borrower who is a party to a subsidised loan with a loan provider, means the loan account maintained by the loan provider in the name of the borrower (or in the names of the borrower and another person or persons) in connection with the subsidised loan. subsidy means: (a) subsidy payable under this Act; or (b) in paragraph (c) of step 2 of the method statement in subsection 46(1) (working out service credits)—subsidy payable under the Defence Force (Home Loans Assistance) Act 1990 or the Defence Service Homes Act 1918. subsidy certificate means a certificate given under Part 3. surviving partner has the meaning given by section 4. Note: Partner is defined in this section. For the definition of deceased partner, see section 4. unit means a unit held under a strata title system (or a similar system) established under a law of a State or Territory (however the unit is described for the purpose of that law), together with: (a) any accompanying common property; and (b) any permanent improvement (for example, a garage or storeroom) associated with the unit. Note: A house (as defined in this section) may be a unit. warlike service means service in the Defence Force of a kind determined as warlike service for the purposes of the Veterans' Entitlements Act 1986, whether the determination is made, or the service performed, before, on or after the commencing day. Note: See section 5C of the Veterans' Entitlements Act 1986. 4 Meaning of deceased partner and surviving partner Scope (1) This section applies if 1 partner in a relationship dies. Definitions (2) In this Act: deceased partner means the partner who died. surviving partner means the partner of the deceased partner. Note: For the definition of partner, see section 3. 5 When a person is a member of the Reserves Membership of the Reserves (1) For the purposes of this Act, a person who has been engaged (by enlistment, appointment or transfer) as a member of the Reserves at a particular time (the engagement time) is to be treated as a member of the Reserves until: (a) the engagement ends; or (b) during a service year: (i) the engagement does not end; but (ii) the person does not perform effective service as a member of the Reserves. Effect of failure to perform effective service (2) If a person's membership of the Reserves ends under paragraph (1)(b) in relation to a service year, this Act applies to the person, and is taken to have applied to the person, as if he or she had: (a) in the case of a person who was a member of the Reserves at the end of the previous service year—stopped being a member of the Reserves immediately after the end of the previous service year; or (b) in any other case—not been engaged as a member of the Reserves at the engagement time. Note: This section may have the following effects: (a) the time at which a person is taken to stop being a member of the Reserves (or of the Defence Force) may be affected; (b) there may be a retrospective loss of entitlements in relation to subsidy certificates, the payment of subsidy, service credits and accrued subsidy periods and loan limits; (c) in particular, an authorisation of the payment of subsidy on the basis of a person's membership of the Reserves may be revoked retrospectively (see section 44); (d) if a subsidised borrower who is taken not to have been a member of the Reserves because of the operation of subsection (2) would have been otherwise entitled to subsidy, the authorisation of the payment of subsidy to the person may be varied retrospectively (see section 45). Example: A person is engaged as a member of the Reserves. The person is given a subsidy certificate under Part 3 on the basis of eligibility as a serving member of the Reserves. The person starts to receive amounts of monthly subsidy accordingly. However, at the end of the service year, the person has not performed effective service as a member of the Reserves. Because of subsection (2), this Act applies as if the person was not entitled to be given the subsidy certificate (because he or she was not eligible as a member of the Reserves). As a result, the original authorisation of the payment of subsidy may be revoked or varied (see sections 44 and 45). Amounts of subsidy to which the person is not entitled (because of the revocation or variation) are recoverable as overpayments under Division 6 of Part 4. 6 External Territories This Act extends to every external Territory. Part 2—Eligibility 7 Eligibility—who is eligible? A person is eligible if the person is eligible as any of the following: (a) a serving member (see section 8); (b) an incapacitated member (see section 9); (c) a rejoining incapacitated member (see section 10); (d) a rejoining member (see section 11); (e) a separated member (see section 12); (f) an old scheme member (see section 13). 8 Eligibility—serving members (1) A person is eligible as a serving member at a particular time (the eligibility time) if, at that time, the person: (a) is a member of the Defence Force; and (b) has completed (whether before, on or after the commencing day) the relevant qualifying service period under subsection (2). (2) The qualifying service period for a serving member is: (a) if the member is, at the eligibility time, a member of the Permanent Forces—2 years of effective service; and (b) if the member is, at the eligibility time, a member of the Reserves—4 years of effective service; and (c) if the member is, at the eligibility time, a foreign service member—2 years of effective service. Note: For the definition of effective service, see section 3. (3) A person is not eligible as a serving member at a particular time if the person is eligible as a rejoining incapacitated member (see section 10) or as a rejoining member (see section 11) at that time. Note: If a member of the Defence Force has had a break in service of more than 5 years before rejoining the Defence Force, the member's service before rejoining the Defence Force no longer counts as effective service (see the definition of effective service in section 3). 9 Eligibility—incapacitated members A person is eligible as an incapacitated member at a particular time if the person: (a) on or after 1 July 2008, stopped being a member of the Defence Force because of a compensable condition; and (b) has not again become a member of the Defence Force. 10 Eligibility—rejoining incapacitated members (1) A person is eligible as a rejoining incapacitated member at a particular time (the eligibility time) if the person: (a) before, on or after the commencing day, stopped being a member of the Defence Force because of a compensable condition; and (b) before, on or after the commencing day, again became a member of the Defence Force within 5 years after he or she stopped being a member; and (c) at the eligibility time: (i) is a member of the Defence Force; and (ii) has completed (whether before, on or after the commencing day) the relevant qualifying service period under subsection (2). (2) The qualifying service period for a rejoining incapacitated member is: (a) if the member is, at the eligibility time, a member of the Permanent Forces—2 years of effective service; and (b) if the member is, at the eligibility time, a member of the Reserves—4 years of effective service. Note: For the definition of effective service, see section 3. 11 Eligibility—rejoining members A person is eligible as a rejoining member at a particular time (the eligibility time) if the person: (a) before, on or after the commencing day, stopped being a member of the Defence Force; and (b) was eligible immediately before he or she stopped being a member; and (c) before, on or after the commencing day, again became a member of the Defence Force within 5 years after the day on which the person stopped being a member; and (d) is a member of the Defence Force at the eligibility time. 12 Eligibility—separated members A person is eligible as a separated member at a particular time if the person: (a) on or after 1 July 2008, stopped being a member of the Defence Force; and (b) was eligible immediately before he or she stopped being a member; and (c) has not again become a member of the Defence Force. 13 Eligibility—old scheme members A person is eligible as an old scheme member if the person meets the requirements prescribed by the regulations. Part 3—Subsidy certificates Division 1—Application for subsidy certificate 14 Application for subsidy certificate (1) A person may apply to the Secretary for a subsidy certificate. (2) An application must be in the approved form. Note 1: Section 77 deals with approved forms. Note 2: Sections 137.1 and 137.2 of the Criminal Code create offences for providing false or misleading information or documents. 15 Further information about application (1) The Secretary may, by writing, request an applicant for a subsidy certificate to give to the Secretary, within the period stated in the request, further stated information in relation to the application. (2) The Secretary may refuse to consider the application until the applicant gives the Secretary the information in accordance with the request. Note 1: Part 5 provides for the administrative review of a decision to refuse to consider an application for a subsidy certificate. Note 2: Sections 137.1 and 137.2 of the Criminal Code create offences for providing false or misleading information or documents. Division 2—Decision to give subsidy certificate 16 Decision to give subsidy certificate—general Scope (1) This section applies if a person applies for a subsidy certificate in accordance with section 14. Decision to give, or to refuse to give, subsidy certificate (2) The Secretary must give a subsidy certificate to the applicant if: (a) section 17, 18, 19 or 20 applies; and (b) either: (i) the applicant has a service credit (see section 46); or (ii) for a case in which section 18 (surviving partners) applies—the applicant has a service credit, or would, if the subsidy certificate were in force, have a service credit (because of the operation of section 63). Note: As soon as a subsidy certificate given under section 18 (surviving partners) comes into force, the surviving partner has the service credit the deceased partner would have had, if he or she had not died (see sections 63 and 64). (3) The Secretary: (a) must refuse to give a subsidy certificate to the applicant if subsection (2) does not apply; and (b) despite subsection (2), may refuse to give a subsidy certificate to the applicant under that subsection if, in relation to a previous entitlement period: (i) the applicant failed to comply with section 42 (which deals with the disclosure of changes of circumstances); or (ii) the Secretary has revoked an authorisation of the payment of subsidy to the applicant under section 44. Note: Part 5 provides for the administrative review of a decision to refuse to give a subsidy certificate to an applicant. 17 Decision to give subsidy certificate—eligible applicants The Secretary must give a subsidy certificate to the applicant if the Secretary is satisfied that the applicant: (a) is eligible; and (b) does not hold a subsidy certificate that is in force; and (c) if the applicant is not a member of the Defence Force—has not previously applied for a subsidy certificate since he or she stopped being a member of the Defence Force. 18 Decision to give subsidy certificate—surviving partners The Secretary must give a subsidy certificate to the applicant if the Secretary is satisfied that: (a) the applicant is the surviving partner of a deceased partner; and (b) the deceased partner was eligible immediately before his or her death; and (c) the applicant has not previously been given a subsidy certificate under this section in relation to the deceased partner. Note: Entitlement to subsidy may be transferred from a deceased partner to a surviving partner in certain circumstances, without the requirement for the surviving partner to obtain a new subsidy certificate (see sections 60 and 61). 19 Decision to give subsidy certificate—loan discharged due to destruction or compulsory sale of house The Secretary must give a subsidy certificate to the applicant if the Secretary is satisfied that: (a) a subsidised loan to the applicant is discharged because property that secured the loan is: (i) destroyed; or (ii) compulsorily acquired under a law of the Commonwealth, a State or a Territory; or (iii) sold or transferred under an order of a court, other than an order made under the Bankruptcy Act 1966 or in proceedings for the recovery of a debt; and (b) the applicant was a subsidised borrower in respect of the subsidised loan immediately before the loan was discharged; and (c) the application is made within 12 months after the subsidised loan is discharged. 20 Decision to give subsidy certificate—loan discharged due to compensable condition The Secretary must give a subsidy certificate to the applicant if the Secretary is satisfied that: (a) on or after 1 July 2008, the applicant stopped being a member of the Defence Force because of a compensable condition; and (b) a subsidised loan to the applicant is discharged because property that secured the loan is sold or transferred; and (c) the Secretary is satisfied that the sale or transfer was reasonably necessary because of the applicant's compensable condition; and (d) the applicant was a subsidised borrower in respect of the subsidised loan immediately before the loan was discharged; and (e) the application is made within 12 months after the subsidised loan is discharged. 21 Form of subsidy certificate (1) A subsidy certificate must be in the approved form. (2) A failure to comply with this section does not affect the validity of the certificate. Note: Section 77 deals with approved forms. Division 3—Effect of subsidy certificate 22 Period subsidy certificate in force A subsidy certificate: (a) comes into force on the day stated in the certificate; and (b) stops being in force at the earliest of the following times: (i) if subsidy becomes payable to the person who holds the certificate—immediately after the end of the first authorisation day for the subsidy; (ia) if the person who holds the subsidy certificate is not a member of the Defence Force (or has stopped being a member of the Defence Force)—as soon as the person no longer has a service credit (see section 46); (ii) if the certificate is cancelled under section 25—at the time of cancellation; (iii) in any other case—12 months after the certificate was given. 23 Subsidy certificate not a legislative instrument A subsidy certificate is not a legislative instrument. Division 4—Variation and cancellation of subsidy certificates 24 Variation of subsidy certificate Secretary may vary certificate (1) If a subsidy certificate contains an error or omission, the Secretary may, by written notice to the person who holds the certificate, vary the certificate by revoking the certificate and substituting another. Note: Part 5 provides for the administrative review of a decision to vary a subsidy certificate. Effect of variation (2) If the Secretary varies a subsidy certificate (by revoking it and substituting another), the certificate as substituted: (a) has effect as if it had been the original certificate; and (b) comes into force (or is taken to have come into force) on the day stated in the original certificate. 25 Cancellation of subsidy certificate The Secretary may, by written notice given to a person who holds a subsidy certificate, cancel the certificate if the Secretary is satisfied that: (a) the certificate was given as a result of a false or misleading statement made by the person; or (b) at the time the decision to give the certificate was made, the person was not entitled to be given the certificate. Note: Part 5 provides for the administrative review of a decision to cancel a subsidy certificate. Part 4—Subsidy Division 1—Entitlement to subsidy Subdivision A—General 26 Entitlement—form of subsidy Subsidy is only payable to a person in the form of: (a) monthly subsidy worked out under section 49; or (b) both of the following: (i) monthly subsidy worked out under section 49; (ii) a subsidy lump sum worked out under section 54. Note: A subsidy lump sum is only payable to a member of the Defence Force, and is only payable in relation to the first residential property bought while the person is a member of the Defence Force (see section 34). 27 Entitlement—authorisation by Secretary Authorisation of initial payment (1) The Secretary must authorise the payment of subsidy to a person if subsidy becomes payable to the person under subsection 28(1). Note: An authorisation under this subsection may be revoked under section 44. In certain circumstances related to membership of the Reserves, the authorisation may be varied under section 45. (2) The Secretary: (a) must refuse to authorise the payment of subsidy to a person under subsection (1) if subsidy has not become payable to the person under subsection 28(1); and (b) despite subsection (1), may refuse to authorise the payment of subsidy to a person under that subsection if, in relation to a previous entitlement period: (i) the person failed to comply with section 42 (which deals with the disclosure of changes of circumstances); or (ii) the Secretary has revoked an authorisation of the payment of subsidy to the person under section 44. Note: Part 5 provides for the administrative review of a decision to refuse to authorise the payment of subsidy. Authorisation of continuing monthly payments (3) The Secretary must (on a monthly basis) authorise the continued payment of monthly subsidy to a person while subsidy continues to be payable to the person under subsection 28(3). Note: Monthly subsidy is paid to the subsidised borrower's loan provider on a monthly basis (by a payment into the borrower's subsidised loan account for the borrower's benefit) under Division 4. (4) The Secretary must refuse to authorise the continued payment of monthly subsidy to a person if subsidy stops being payable to the person under section 36. Note: Part 5 provides for the administrative review of a decision to refuse to authorise the continued payment of monthly subsidy. 28 Entitlement—criteria When subsidy becomes payable (1) Subsidy becomes payable to a subsidised borrower in relation to a loan to the borrower if: (a) the loan is made by a declared loan provider; and (b) the loan is secured by a mortgage over an interest (including a leasehold interest) in land; and (c) the conditions under Subdivision B are met. (2) Subsidy becomes payable to a subsidised borrower with effect from the beginning of the monthly authorisation period during which subsection (1) starts to apply in relation to the borrower. When subsidy continues to be payable (3) After subsidy becomes payable to a subsidised borrower, monthly subsidy continues to be payable to him or her during a continuous period (an entitlement period) until it stops being payable under section 36, subject to section 44 (revocation of authorisation of payment of subsidy). Note 1: If subsidy is payable to a person, the person is a subsidised borrower (see section 3). Note 2: If payment of subsidy is suspended under section 61 because of a subsidised borrower's death, the suspension does not break the continuity of the entitlement period. Note 3: If the Secretary revokes an authorisation under section 44 in relation to an entitlement period, subsidy is taken never to have been payable during the period. Multiple loans and subsidised borrowers who are partners etc. (4) Nothing in this Part prevents subsidy from being payable: (a) in relation to more than one loan during different entitlement periods; or (b) in relation to more than one house, or interest in land, during different entitlement periods; or (c) to each of 2 subsidised borrowers in his or her own right in relation to the same loan. Note: Special rules may apply for working out the amount of loan capital (which affects the amount of subsidy) if a subsidised borrower and another person are liable in respect of the same subsidised loan (see sections 51A, 51B and 51C). Subdivision B—When subsidy becomes payable 29 When subsidy becomes payable—eligibility and service credits The following conditions must be met: (a) a subsidy certificate held by the subsidised borrower must be in force; (b) the subsidised borrower must have a service credit under section 46. Note: Immediately after the first authorisation day for the subsidy, the subsidy certificate stops being in force (see section 22). If subsidy stops being payable (under section 36), the subsidised borrower can only again become entitled to subsidy under this Division if he or she is given a new subsidy certificate. 30 When subsidy becomes payable—use of subsidised loan (1) The Secretary must be satisfied that the subsidised loan is used, or is to be used, to do one of the following: (a) to buy the interest in land, if there is a house on the land; (b) to buy the interest in land and undertake work (building work) on the land consisting of any of the following: (i) the construction or the completion of a house, other than a unit, on the land; (ii) the enlargement, renovation or repair of a house on the land; (iii) the construction of any other permanent improvement on the land, if the improvement is used primarily for private or domestic purposes in association with the house; (c) if the subsidised borrower already has an interest in the land—to undertake building work on the land; (d) to discharge another loan used by the subsidised borrower for a purpose mentioned in paragraph (a), (b) or (c). (2) If a house mentioned in subsection (1) is a unit, paragraphs (1)(b) and (c) do not cover building work in relation to any accompanying common property. Note: For the definitions of house and unit, see section 3. 31 When subsidy becomes payable—ownership and location of land The following conditions must be met: (a) the subsidised borrower, or the subsidised borrower and his or her partner together, must hold a 50% or greater interest in the land: (i) no matter whether the interest is held individually, as joint tenants or as tenants in common; and (ii) no matter whether the interest is legal or equitable; (b) no part of the interest in land must be held as a trustee or as a beneficiary of a trust; (c) the land must be in Australia. 32 When subsidy becomes payable—occupation of house as a home (non‑building loan) Scope (1) This section applies if the subsidised loan is: (a) for the purpose covered by paragraph 30(1)(a) (to buy a house and land), or to discharge another loan for that purpose; and (b) not for the purpose of building work, or to discharge another loan for that purpose. Subsidy condition (2) The Secretary must be satisfied that the subsidised borrower, or a dependant of the subsidised borrower, occupies a house on the land as a home. Note 1: This condition need only be satisfied for the first year after the first authorisation day for the subsidy (see section 39). Note 2: In the case of a loan for the purpose of building work, a similar occupation condition applies to the continuation of entitlement to subsidy after the completion of the building work (see section 40). 33 When subsidy becomes payable—use of land (1) The Secretary must be satisfied that the land is not used primarily for the purpose of carrying on a business, trade or profession. (2) If the subsidised loan relates to a unit, subsection (1) does not apply to any accompanying common property, or any other unit, held under the same strata title (or similar) system. 34 When subsidy becomes payable—subsidy lump sum (1) In addition to the other conditions in this Subdivision, all of the following conditions must be met for a subsidy lump sum to be payable to the subsidised borrower at a particular time: (a) the subsidised borrower must give the Secretary a request, in the approved form, for the payment of a subsidy lump sum; (b) the subsidised borrower must be a member of the Defence Force; (c) the Secretary must be satisfied that there is a reasonable expectation that the subsidised borrower will: (i) continue to be a member of the Defence Force for 1 year after the first authorisation day for the subsidy; and (ii) comply with all the relevant conditions mentioned in sections 37 to 41; (d) the request must state a number of months (not exceeding 48) of service credit to be accessed for the purpose of section 54 (which deals with the amount of the subsidy lump sum); (e) the subsidised borrower must have at least the number of months standing to his or her service credit that is stated in the request; (f) the Secretary must be satisfied that there is a reasonable expectation that monthly subsidy will be payable to the subsidised borrower during an entitlement period of: (i) if the subsidised borrower is, at the time, a member of the Permanent Forces—at least one month; or (ii) if the subsidised borrower is, at the time, a member of the Reserves—at least the number of months remaining in the service year; (g) subsection (2) (previous home ownership etc.) must not apply. Note: Sections 137.1 and 137.2 of the Criminal Code create offences for providing false or misleading information or documents (for example, in a request under paragraph (1)(a)). Previous home ownership etc. (2) This subsection applies if all of the following conditions are met: (a) the subsidised borrower has, at a time when the subsidised borrower was a member of the Defence Force, bought an interest in land in Australia; (b) the purchase results in the borrower, or the borrower and his or her partner together, holding a 50% or greater interest in the land: (i) no matter whether the interest is held individually, as joint tenants or tenants in common; and (ii) no matter whether the interest is legal or equitable; (c) at some time while such an interest is held: (i) there is a house on the land; and (ii) the house is occupied by the borrower or another person as a home, or could be occupied by the borrower or another person as a home; (d) either: (i) the interest in land is not the interest in relation to which the request for lump sum subsidy is made; or (ii) if the interest in land is the interest in relation to which the request for lump sum subsidy is made—the interest was bought before the Secretary gave the borrower the subsidy certificate on the basis of which the lump sum subsidy is requested. Subsidised borrower is surviving partner (3) In the application of this section to a person who is a subsidised borrower by virtue of being a surviving partner of a deceased partner: (a) the number of months standing to the subsidised borrower's service credit is the number of months applying by the operation of sections 63 and 64; but (b) for a subsidy lump sum to be payable to the subsidised borrower, the borrower must otherwise meet the conditions mentioned in subsection (1) in his or her own right. Note: A surviving partner may be entitled to subsidy by the operation of section 63. Subdivision C—When subsidy stops being payable 35 When subsidy stops being payable—scope This Subdivision applies if, in relation to a particular entitlement period, the Secretary has (under section 27) authorised the payment of subsidy to a subsidised borrower in relation to a subsidised loan, secured by a mortgage over an interest in land. 36 When subsidy stops being payable—general (1) Subsidy stops being payable to the subsidised borrower, in relation to the entitlement period: (a) if an event mentioned in an item in the following table occurs; and (b) with effect from the start of the monthly authorisation period in which the critical time provided for that item occurs. When subsidy stops being payable Item Event Critical time 1 All outstanding amounts due under the subsidised loan are paid As soon as the outstanding amounts are paid 2 The subsidised borrower no longer has a service credit As soon as the subsidised borrower no longer has a service credit 3 Subsidy becomes payable to the subsidised borrower in relation to another loan (unless subsidy is payable in relation to one of the loans by the operation of Division 5 (subsidy for surviving partners)) When subsidy becomes payable in relation to the other loan 4 The Secretary is satisfied that the condition under section 37 (relating to the completion of building work) is not met 2 years after the first authorisation day for the subsidy 5 A condition mentioned in section 38 (relating to the ownership of land) is not met As soon as the condition is not met 6 The Secretary is satisfied that the condition under section 39 or 40 (relating to occupation of the house) is not met As soon as the condition is not met 7 The Secretary is satisfied that the condition under section 41 (relating to the use of the land) is not met As soon as the condition is not met 8 The Secretary is satisfied that the condition under section 42 (relating to the disclosure of changes of circumstances) is not met in relation to an event At the earlier of the following times: (a) the time the subsidised borrower becomes aware of the event; (b) the constructive knowledge time mentioned in subsection 42(3) 9 Subsidy stops being payable in accordance with a notice given by the Secretary under section 43, at the request of the subsidised borrower On the later of the following days: (a) the day requested by the subsidised borrower; (b) a day (if any) stated by the Secretary in the notice 10 Authorisation for the payment of subsidy to the subsidised borrower is revoked in accordance with a notice given by the Secretary under subsection 44(2) When subsidy first became payable 11 The subsidised borrower dies, unless subsidy is, or becomes, payable to the borrower's surviving partner under section 60 or 61 When the subsidised borrower dies Note: The Commonwealth may recover, as overpayments, any subsidy paid to a subsidised borrower after subsidy has stopped (or is taken to have stopped) being payable to him or her (see Division 6). (2) The Secretary may, by writing, declare that an event mentioned in item 1 of the table in subsection (1) is taken not to have occurred in relation to a subsidised borrower if the Secretary is satisfied that all outstanding amounts due under the subsidised loan were paid as a result of a genuine error, mistake or accident. (3) A declaration made under subsection (2) is not a legislative instrument. 37 When subsidy stops being payable—completion of building work Scope (1) This section applies if the subsidised loan is for the purpose of building work, or to discharge another loan for such a purpose. Subsidy condition (2) The building work must be completed within 2 years after the first authorisation day for the subsidy. 38 When subsidy stops being payable—ownership of land The following conditions must continue to be met: (a) the subsidised borrower, or the subsidised borrower and his or her partner together, must hold a 50% or greater interest in the land: (i) no matter whether the interest is held individually, as joint tenants or as tenants in common; and (ii) no matter whether the interest is legal or equitable; (b) no part of the interest in the land must be held as a trustee or as a beneficiary of a trust. 39 When subsidy stops being payable—occupation of house as a home (non‑building loan) Scope (1) This section applies if the subsidised loan is: (a) for the purpose covered by paragraph 30(1)(a) (to buy a house and land), or to discharge another loan for that purpose; and (b) not for the purpose of building work, or to discharge another loan for such a purpose. Subsidy condition (2) At any time during the period covered by subsection (3), the subsidised borrower, or a partner or dependant of the subsidised borrower, must occupy a house on the land as a home. (3) This subsection covers the period: (a) starting on the first authorisation day for the subsidy; and (b) ending: (i) 1 year after that day; or (ii) if the Secretary is satisfied that there are service requirements, or exceptional circumstances, justifying a shorter period of occupation—at an earlier time approved by the Secretary in writing. 40 When subsidy stops being payable—occupation of house as a home (building loan) Scope (1) This section applies if the subsidised loan is for the purpose of building work, or to discharge another loan for such a purpose. Subsidy condition (2) At any time during the period covered by subsection (3), the subsidised borrower, or a partner or dependant of the subsidised borrower, must occupy a house on the land as a home. (3) This subsection covers the period: (a) starting on the day the building work is completed; and (b) ending: (i) 1 year after that day; or (ii) if the Secretary is satisfied that there are service requirements, or exceptional circumstances, justifying a shorter period of occupation—at an earlier time approved by the Secretary in writing. Note: The building work must be completed within 2 years after the first authorisation day for the subsidy (see section 37). 41 When subsidy stops being payable—use of land (1) The land must not be used primarily for the purpose of carrying on a business, trade or profession. (2) If the subsidised loan relates to a unit, subsection (1) does not apply to any accompanying common property, or any other unit, held under the same strata title (or similar) system. 42 When subsidy stops being payable—disclosure of changes of circumstances Scope (1) This section applies if any of the following events occurs: (a) a reasonably significant change to the agreement for the subsidised loan between the subsidised borrower and the loan provider who made the loan to the subsidised borrower, or to the conditions of the mortgage; (b) a change that affects the way in which the subsidised borrower's service credit is worked out; (c) a reasonably significant change to a house or permanent improvement mentioned in section 30 (including the destruction of the house or improvement), or any other reasonably significant change affecting the land; (d) in a case in which the subsidised loan is for the purpose of building work, or to discharge another loan for such a purpose—the building work is completed; (e) a change in the nature or extent of the interest held in the land by the subsidised borrower or his or her partner; (f) in a case in which the subsidised borrower holds an interest in the land with his or her partner together (as mentioned in paragraph 38(a))—the subsidised borrower and the partner stop being partners; (g) during the period covered by subsection 39(3) or 40(3)—the subsidised borrower, or a partner or dependant of the subsidised borrower, stops occupying a house on the land; (h) the land starts to be used, to a reasonably significant extent, for the purpose of carrying on a business, trade or profession. (2) If the subsidised loan relates to a unit, paragraph (1)(h) does not apply to any accompanying common property, or any other unit, held under the same strata title (or similar) system. Subsidy condition (3) The subsidised borrower must give notice of the event to the Secretary, in the approved form, within a reasonable time after the time (the constructive knowledge time) the Secretary is satisfied that it is reasonable for the subsidised borrower to have become aware of the event. Note: Sections 137.1 and 137.2 of the Criminal Code create offences for providing false or misleading information or documents. (4) Without limiting subsection (3), a subsidised borrower fails to comply with the subsection even if, at the constructive knowledge time, the borrower was not aware of the event. Note: A failure to comply with this condition is grounds for the Secretary to refuse to give a subsidy certificate on a future occasion, and to refuse authorisation for the payment of subsidy in relation to a future entitlement period (see sections 16 and 27). 43 When subsidy stops being payable—on request by the subsidised borrower (1) The subsidised borrower may, in the approved form, request the Secretary to stop the payment of subsidy. (2) On receipt of a request under subsection (1), the Secretary must stop the payment of subsidy, by written notice given to the subsidised borrower. (3) The Secretary may, in the notice, state a day for the payment of subsidy to be stopped that is later than the day requested by the subsidised borrower. Note: Part 5 provides for the administrative review of a decision by the Secretary to state a day in a notice under this subsection. (4) The Secretary must give a copy of the notice to the loan provider who made the subsidised loan to the subsidised borrower. Subdivision D—Revocation and variation 44 Revocation of authorisation for the payment of subsidy Scope (1) This section applies if: (a) the Secretary authorises the payment of subsidy to a subsidised borrower under section 27 in relation to a subsidised loan, on the basis of a subsidy certificate; and (b) as a result, subsidy has been paid to the subsidised borrower during an entitlement period. Note: If the payment of subsidy is authorised because the subsidised borrower is a surviving partner of a deceased partner, the subsidy certificate concerned may be a subsidy certificate given to the deceased partner or to the surviving partner. Revocation of authorisation (2) The Secretary may, by written notice to the subsidised borrower, revoke the authorisation of the payment of subsidy to the subsidised borrower in relation to the entitlement period if the Secretary is satisfied that: (a) the subsidy certificate ought not to have been given; or (b) the subsidy certificate was only given because of a false or misleading statement by the subsidised borrower (or anyone else); or (c) payment of subsidy at any time during the entitlement period was only made (or continued) because of a false or misleading statement by the subsidised borrower (or anyone else). Note: Part 5 provides for the administrative review of the Secretary's decision to revoke the authorisation. (3) The Secretary may give a notice under subsection (2) during the entitlement period, or at any time after the end of the entitlement period. Effect of revocation (4) If an authorisation is revoked under this section, subsidy is taken not to have become payable to the subsidised borrower during the entitlement period. Note: The Commonwealth may recover, as overpayments, any subsidy paid to a subsidised borrower during the entitlement period if subsidy is taken not to have become payable to the borrower (see Division 6). Notice to loan provider (5) The Secretary must give a copy of a notice under subsection (2) to the loan provider who made the loan to the subsidised borrower. If the subsidised borrower has died (6) If the subsidised borrower has died, the Secretary may revoke the authorisation of the payment of subsidy to the subsidised borrower by giving a notice under subsection (2) to the borrower's legal personal representative. If the subsidised borrower is a surviving partner (7) In the application of this section to a surviving partner (of a deceased partner) who is a subsidised borrower because of section 60 or 61: (a) a reference in paragraph (2)(c) to the payment of subsidy includes a reference to the payment of subsidy to the deceased partner during the entitlement period; and (b) subsection (4) does not apply to the deceased partner's entitlement to subsidy. Note 1: Revocation of an authorisation is grounds for the Secretary to refuse to give a subsidy certificate on a future occasion, and to refuse authorisation for the payment of subsidy in relation to a future entitlement period (see sections 16 and 27). Note 2: If section 45 (variation of authorisation of payment of subsidy—when a person is not a member of the Reserves) applies, the authorisation of the payment of subsidy cannot be revoked under this section because of the operation of subsection 5(2) (which relates to when a member stops being a member of the Reserves) (see subsection 45(5)). 45 Variation of authorisation of payment of subsidy—when a person is not a member of the Reserves Scope (1) This section applies in relation to a subsidised borrower if the Secretary is satisfied that, immediately after the end of a service year: (a) the Secretary, under section 27, has authorised the payment of subsidy to the subsidised borrower during an entitlement period beginning at or after the start of the service year on the basis of the borrower's eligibility as a member of the Reserves; and (b) subsection 5(2) applies to the subsidised borrower's membership of the Reserves in relation to the service year; and (c) by the operation of that subsection, the Secretary would (apart from this section) have the power to revoke the authorisation of the payment of subsidy to the subsidised borrower under section 44; and (d) during the entitlement period, the Secretary could have given a subsidy certificate to the subsidised borrower, and subsidy on the basis of that certificate would have been payable to the borrower, otherwise than on the basis of the borrower's eligibility as a member of the Reserves. Example 1: Paragraph (d) may apply because of the operation of subsection 5(2). Subsidy might have otherwise been payable to the subsidised borrower on the basis of the borrower's eligibility as a separated member (as the result of the person's being taken to have stopped being a member of the Reserves). Example 2: Paragraph (d) may also apply despite the operation of subsection 5(2). If the subsidised borrower's partner is a member of the Defence Force, and the partner dies, subsidy might in any case have been payable to the borrower as the surviving partner of the deceased partner. Variation of authorisation (2) The Secretary may, by written notice to the subsidised borrower, vary the authorisation of the payment of subsidy to the borrower in relation to the entitlement period. Note: Part 5 provides for the administrative review of the Secretary's decision to vary the authorisation. (3) The Secretary may give a notice under subsection (2) during the entitlement period, or at any time after the end of the entitlement period. Effect of variation (4) If an authorisation is varied under this section: (a) subsidy is payable, and is taken to have become payable, to the subsidised borrower on the basis of the borrower's eligibility (otherwise than as a member of the Reserves) as mentioned in paragraph (1)(d); and (b) subsidy is taken to have become (and continued) to be so payable (subject otherwise to this Act) with effect from the earliest time that subsidy would have been payable to the subsidised borrower as mentioned in paragraph (1)(d). Note: If the amount of subsidy paid to the subsidised borrower during the entitlement period on the basis of the borrower's membership of the Reserves exceeds the amount of subsidy payable to the borrower as a result of the operation of this subsection, the Commonwealth may recover the amount of the excess as an overpayment (see Division 6). Application of section 44 (5) If this section applies in relation to the authorisation of the payment of subsidy to a subsidised borrower, the authorisation cannot be revoked under section 44 only because of the operation of subsection 5(2). Notice to loan provider (6) The Secretary must give a copy of a notice under subsection (2) to the loan provider who made the loan to the subsidised borrower. If the subsidised borrower has died (7) If the subsidised borrower has died, the Secretary may vary the authorisation of the payment of subsidy to the subsidised borrower by giving a notice under subsection (2) to the borrower's legal personal representative. Division 2—Service credits 46 Working out service credits (1) Whether a person has a service credit at a particular time (the subsidy time) for the purposes of an entitlement period, and the length of time standing to the person's service credit, is worked out as follows. Method statement Step 1. Work out the person's accrued subsidy period under section 47, in completed months, as at the subsidy time. Step 2. Add together the following: (a) if a subsidy lump sum has become payable to the person—the number of months of service credit accessed for the subsidy lump sum (see section 54); (b) in any case—the number of months in respect of which monthly subsidy has been payable in relation to the person under this Act, as at the subsidy time; (c) in any case—the number of months in respect of which subsidy has been payable in relation to the person under the Defence Force (Home Loans Assistance) Act 1990 and the Defence Service Homes Act 1918, as at the subsidy time. Step 3. If the step 1 result exceeds the step 2 result, the person has a service credit at the subsidy time. Step 4. The number of months (if any) by which the step 1 result exceeds the step 2 result is the number of months standing to the person's service credit. (2) Step 2 of the method statement in subsection (1): (a) includes months during a previous entitlement period or periods; and (b) includes a reference to a subsidy lump sum that became payable to a person during a previous entitlement period; and (c) includes months during which subsidy was paid (under this or another Act) whether or not the months are continuous. 47 Service credits—working out accrued subsidy periods (1) A person's accrued subsidy period, at a particular time, is the period that applies to the person in accordance with the following table. Accrued subsidy period Item If the person is eligible at the time … the person's accrued subsidy period at the time is … up to a maximum period of … 1 As a serving member (see section 8) The number of months of effective service the person has completed since becoming eligible as a serving member 240 months (20 years) 2 As an incapacitated member (see section 9) The greater of the following: 240 months (20 years) (a) the number of months of effective service the person had completed when he or she stopped being a member of the Defence Force;