If you have been awarded a TAC or WorkSafe payment, a portion of it may have already been allocated for ‘loss of earnings’ or ‘lost earning capacity’. If this is the case, you will need to serve a ‘preclusion period’ before receiving most payments from Centrelink. (This is not the case for the Family Tax benefit or a Health Care Card).

A preclusion period is basically the amount of time that you cannot receive a Centrelink payment for.

This means that, for a certain period, you are not able to claim Centrelink benefits. The preclusion period is there because the amount you were awarded already takes into account your loss of earnings, and that this has been projected into the future as ‘economic loss’.

How long will the preclusion period be?

This will depend upon the amount you were awarded in compensation.

Basically, Centrelink works it out like this:They take an amount that is half what you received in your compensation, which is usually the amount you have been awarded for loss of earnings or lost earning capacity.

So, you received $250,000 as compensation for your accident. Half of this is $125,000.

Then they divide this by the weekly income figure at which Centrelink payments cut out for a single person. This is under the ‘pension income test’.

The ‘pension income test cut-out point’ is currently $1198.70 per week for a single person aged 21 or older on a pension (as at November 2023). This changes every three months, so always check.

You divide the loss of earnings amount ($125,000) by the pension income test cut-out point ($1198.70). In this case the result = 104.

This is the number of weeks that will be your ‘preclusion period’. It works out that 104 weeks is 2 years. This is the time during which you cannot receive a Centrelink pension or allowance.

You may wish to use the Compensation Estimator to estimate possible preclusion period.

You should always check your personal situation with Centrelink.

If your matter went to trial, there will already be a nominated amount for economic loss which Centrelink will consider. This amount is decided by the Judge or Magistrate who hears your case.
How do I get by during the preclusion period?

You can apply to the Senior Master to receive ‘maintenance payments’ during this time.

A maintenance payment is a payment that is made to a beneficiary, or someone assisting with their care, to help them meet regular living expenses.

If you think this could help you, you can talk to your Trust Officer, or read more information in Maintenance payments.

While you’re waiting for your preclusion period to end, you might be eligible for a Health Care Card. You need to apply to Centrelink for this.