Member's Guide to ADF Pay and Conditions in Australia – see Disclaimer
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3.6
Military Superannuation and Benefits Scheme retention benefit
The purpose of the benefit is
to provide a payment to an eligible member after 15 years of continuous
eligible service. It encourages members to serve until they have completed 20
years' service.
Who is eligible?
You may be eligible if you
are in one of these groups.
·
You are ranked Major or above (officers), or Sergeant or
above (other ranks).
·
You are an officer who was a sailor, soldier, or
airman/airwoman, immediately before being commissioned.
·
You are a Chaplain earning at least a Major's salary.
You need to be a member of
the Military Superannuation and Benefits Scheme (MSBS). You also need 15 years'
continuous unbroken service.
Who else might be
eligible?
You may be eligible if you
have not reached Major or Sergeant rank, and you are
in an employment category declared by the Minister to be a 'specified category'
or an 'inter-employment category'.
These categories relate to
members whose promotion prospects have been limited for certain Service-related
reasons.
How much is it?
If you elect to undertake service
to the 20 year point, the payment will equal one year's salary plus Service
allowance at your rank and salary at the time the benefit is payable
(computation day). A pro-rata amount will be paid if, from the time of
eligibility, you are not able to complete a full five years' further service
before the 20 year point.
This can happen if you become
eligible by promotion after having completed 15 years' service.
The payment is taxed as if it
were salary. You might like to seek financial advice about how the payment will
affect your taxation obligations.
You have the choice of salary
sacrificing your payment. This means that you pay it into an approved
superannuation fund (see 3.4,
Salary packaging).
What does it mean?
By accepting the payment, you
are agreeing to serve in the Permanent Forces until your 20 years' service
point. If you do leave voluntarily (or a Service tribunal terminates your
services), you will have to repay a pro rata part of the benefit.
When to apply?
To accept the benefit, you
must apply during the period that starts 90 days before you are eligible, and
ends on the day you become eligible. If you are promoted to the rank of Major
or Sergeant when you have between 15 and 20 years' service, you will be
eligible to receive the benefit on a proportional basis and you must elect to
accept the benefit no more than 90 days after you are promoted. There can be no
exceptions to this time limit.
Application to Reservists: No.
References:
ADF Pay and Conditions
Manual, Chapter 3 Part 5 Divisions
1 and 2
Military Superannuation
and Benefits Act 1991, Part 8