Incapacity Payments
Incapacity Payments are an ongoing income replacement benefit for veterans whose accepted conditions prevent them from working at their normal capacity. They're available under both MRCA and DRCA and are calculated on the difference between what you could earn if you were well and what you're actually able to earn because of your condition.
The calculation is based on your Normal Weekly Earnings (NWE) — generally your earnings at the time of separation or at the onset of incapacity — compared to your actual weekly earnings. The gap is what DVA pays. Payments are subject to review as your circumstances change.
Incapacity Payments require ongoing evidence of incapacity and regular financial documentation. Managing the reviews and keeping DVA updated is part of the ongoing work we do for clients receiving these payments.
Who is eligible
You have an accepted condition under MRCA or DRCA
Your accepted condition is affecting your capacity to work
You are below the applicable pension age
You are not in receipt of SRDP (SRDP and incapacity payments are mutually exclusive under MRCA)
You have financial evidence of your employment situation and earnings capacity
How it works
Establish Incapacity
We gather medical evidence from your treating practitioners establishing the impact of your accepted conditions on your work capacity.
Financial Evidence
We identify your Normal Weekly Earnings and gather the financial evidence DVA needs to calculate your entitlement.
Calculate Entitlement
We calculate your likely entitlement based on your NWE and current earnings capacity so you know what to expect before lodging.
Lodge Form D2059
We complete and lodge Form D2059 with supporting evidence and manage DVA's review process as your circumstances change.
How Clear Path helps
We assess whether your accepted conditions meet the threshold for incapacity payments
We calculate your Normal Weekly Earnings and advise on your likely entitlement
We gather the medical and financial evidence DVA requires and prepare the claim
We manage the ongoing review process so your payments continue without unnecessary interruption
We advise when SRDP may be a better option if your incapacity is severe and permanent
Common questions
What is Normal Weekly Earnings (NWE)?
Normal Weekly Earnings is the reference figure DVA uses to calculate your incapacity payment. It's generally based on what you were earning at the time your incapacity arose, adjusted for factors like pay increases in your former industry. The calculation can be complex and getting it right matters because it directly affects the amount you receive.
Can I receive incapacity payments and work part-time?
Yes. Incapacity payments are calculated on the difference between your NWE and your actual earnings. If you're working part-time because of your condition, the gap between your full earning capacity and what you're actually earning is what DVA pays.
Do incapacity payments stop at a certain age?
Under MRCA, incapacity payments cease at pension age (currently 67). Under DRCA, the rules differ slightly and depend on your circumstances. We'll advise on how age affects your entitlements.
Ready to get started?
Book a free consultation and we'll walk you through what this means for your situation.
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