Motor Vehicle Compensation Scheme 2025

Motor Vehicle Compensation Scheme 2025

made under subsection 212(1) of the

Military Rehabilitation and Compensation Act 2004

Compilation No. 1 

Compilation date: 1 November 2025

Includes amendments: F2025L01171

About this compilation

This compilation

This is a compilation of the Motor Vehicle Compensation Scheme 2025 that shows the text of the law as amended and in force on 1 November 2025 (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. The details of amendments made up to, but not commenced at, the compilation date are underlined in the endnotes. Any uncommenced amendments affecting the law are accessible on the Register (www.legislation.gov.au).

Application, saving and transitional provisions

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.

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. Any modifications affecting the law are accessible on the Register.

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If a provision of the compiled law has been repealed in accordance with a provision of the law, details are included in the endnotes.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

1  Name................................................................1

2  Commencement........................................................1

3  Authority.............................................................1

4  Repeals...............................................................1

5  Definitions............................................................1

6  Schedules.............................................................2

Part 2—Eligibility and amount of compensation.................................3

7  Circumstances when a person is eligible for compensation for modifying a motor vehicle......3

8  Amount of any subsidy..................................................3

9  Commission may request advice from an approved program provider or an occupational therapist......4

10  Eligibility for a subsidy to assist the purchase of an initial motor vehicle..........4

11  Determining the amount of any subsidy....................................5

12  Commission may request advice from an approved program provider or an occupational therapist......5

13  Circumstances when a person is eligible for a replacement motor vehicle.........5

14  Determining the amount of any subsidy....................................6

15  Commission may request advice from an approved program provider or an occupational therapist......7

16  Other compensation...................................................7

17  Amount of other compensation..........................................7

18  Motor vehicle from another scheme.......................................7

19  Conditions relating to the compensation payment............................7

20  Ownership of motor vehicle.............................................8

21  Ongoing expenses relating to the motor vehicle..............................8

Schedule 1—Transitional....................................................9

Schedule 2—Amendments..................................................10

Endnotes................................................................11

Endnote 1—About the endnotes............................................11

Endnote 2—Abbreviation key..............................................12

Endnote 3—Legislation history.............................................13

Endnote 4—Amendment history............................................14

Part 1—Preliminary

1  Name

  This instrument is the Motor Vehicle Compensation Scheme 2025.

2  Commencement

  This instrument commences as follows:

 (a) Parts 1 and 2 and Schedule 1—on the day after the day the instrument is registered;

 (b) Schedule 2—at the same time as the Aged Care Act 2024 commences.

3  Authority

  This instrument is made under subsection 212(1) of the Military Rehabilitation and Compensation Act 2004.

4  Repeals

  The Motor Vehicle Compensation Scheme 2015 (Instrument 2015 No. MRCC 20) is repealed.

5  Definitions

Note: A number of expressions used in this instrument are defined in the Act, including the following:

(a) approved program provider (section 41);

(b) Commission (section 5).

 (1) In this instrument:

Act means the Military Rehabilitation and Compensation Act 2004.

care institution means any of the following that is not the person’s private home:

 (a) a residential care home (within the meaning of section 10 of the Aged Care Act 2024);

 (b) a hospital; or

 (c) a hospice; or

 (d) a psychiatric institution; or

 (e) any similar institution, however described, that provides daily care for the person.

claim means the claim referred to in paragraph 212(1)(c) of the Act.

eligible person means a person to whom paragraphs 212(1)(a), (b) and (c) of the Act apply.

initial motor vehicle means the first motor vehicle (whether new or second hand) that an eligible person has received under section 10 of the Scheme.

interest, in relation to a motor vehicle, means a joint interest in the motor vehicle or other interest but does not include an interest as a mortgagee.

previous motor vehicle means the last motor vehicle (whether new or second hand) that an eligible person received under section 10 or section 13 of the Scheme, as the case may be.

replacement motor vehicle means a motor vehicle (whether new or second hand) provided to an eligible person under section 13 of the Scheme as a replacement for a motor vehicle.

Scheme means this instrument.

6  Schedules

Each instrument that is specified in a Schedule to this instrument is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this instrument has effect according to its terms.

Part 2—Eligibility and amount of compensation

7  Circumstances when a person is eligible for compensation for modifying a motor vehicle

 (1) Subject to any other provision of this Part, a person is eligible for compensation to modify a motor vehicle for the person if, and only if, the Commission is satisfied that:

 (a) the person is an eligible person; and

 (b) if the person is a resident of a care institution, the person is capable of leaving the care institution;

 (c) the person either:

 (i) cannot drive a motor vehicle without driving or other modifications that enable the person to drive safely; or

 (ii) cannot be driven in a motor vehicle without modification that enables the person to be transported safely and in reasonable comfort; and

 (d) the person owns a motor vehicle or has an interest in a motor vehicle that is capable of having driving devices fitted or modifications made for use by the person; and

 (e) if the person has an interest in a motor vehicle, any other person with an interest agrees to the motor vehicle being modified in the way proposed; and

 (f) an approved program provider or an occupational therapist has made a written recommendation to the Commission that the approved program provider or occupational therapist is satisfied on reasonable grounds that the person would derive benefit directly from:

 (i) driving a motor vehicle, taking account of the benefits to the person’s physical and mental health and the person’s level of mobility without driving a motor vehicle; or

 (ii) being driven in a motor vehicle, taking account of the benefits to the person’s physical and mental health and the person’s level of mobility without driving a motor vehicle.

8  Amount of any subsidy

 (1) The amount of any subsidy under section 7, is such amount as the Commission considers is reasonable, taking account of all the other circumstances the Commission thinks are relevant, including all, or any, of the following:

 (a) the nature of the person’s impairment;

 (b) the nature of proposed driving devices or modifications;

 (c) the type and cost of alternative suitable driving devices or modifications that are reasonably available and cost effective;

 (d) whether there are alternative providers of suitable driving devices or modifications that are reasonably accessible and cost effective.

9  Commission may request advice from an approved program provider or an occupational therapist

 (1) The Commission may request advice from an approved program provider or an occupational therapist in relation to the type of any necessary driving devices or modifications to make the motor vehicle safe and reasonably comfortable at the minimum cost.

 (2) The Commission may take any advice provided under subsection (1) into account when determining the amount of any subsidy under section 7.

10  Eligibility for a subsidy to assist the purchase of an initial motor vehicle

 (1) Subject to any other provision of this Part, a person is eligible for compensation in the form of a subsidy to assist the person to purchase an initial motor vehicle if:

 (a) the person is an eligible person; and

 (b) the person either:

 (i) cannot drive a motor vehicle without driving or other modifications that enable the person to drive safely; or

 (ii) cannot be driven in a motor vehicle without modification that enables the person to be transported safely and in reasonable comfort; and

 (c) the person can establish:

 (i) where the person owns a motor vehicle or has an interest in a motor vehicle—that it is either not possible or not practicable to modify that motor vehicle; or

 (ii) the person does not own a motor vehicle or have an interest in a motor vehicle; and

 (d) if the person is a resident of a care institution, the person is capable of leaving the care institution; and

 (e) an approved program provider or an occupational therapist has made a written recommendation to the Commission that the approved program provider or occupational therapist is satisfied on reasonable grounds that the person would derive benefit directly from:

 (i) driving a motor vehicle, taking account of the benefits to the person’s physical and mental health and the person’s level of mobility without driving a motor vehicle; or

 (ii) being driven in a motor vehicle, taking account of the benefits to the person’s physical and mental health and the person’s level of mobility without access to a motor vehicle.

 (2) For the purposes of subsection (1), a person is not to be taken to derive direct benefit through the use of the motor vehicle by another person solely for that other person.

 (3) The Commission may determine to grant a person compensation for modifying a motor vehicle where a person is eligible under subsection (1) if it considers that is appropriate compensation in all the circumstances. Compensation under subsection (1) is only to be available if modification of a person’s motor vehicle or a motor vehicle in which they have an interest is not a cost effective or appropriate option.

11  Determining the amount of any subsidy

 (1) The amount of any subsidy under section 10, is such amount as the Commission considers is reasonable, after deducting the trade-in value at arm’s length of the person’s existing motor vehicle (if any) or interest in a motor vehicle (if any) and taking account of all the other circumstances the Commission thinks are relevant, including all, or any, of the following:

 (a) the nature of the person’s impairment;

 (b) the type and cost of the motor vehicle that the person is proposing to purchase;

 (c) the type and cost of accessories that are reasonably required for the person;

 (d) the type and cost of alternative motor vehicles to the motor vehicle the person is proposing to purchase;

 (e) the ability of the proposed motor vehicle to be fitted with any necessary driving devices or be otherwise modified for the person;

 (f) in relation to a second hand motor vehicle—the number of kilometres travelled by the motor vehicle, the life of the motor vehicle and the possible application of section 12;

 (g) if the person’s existing motor vehicle was stolen or destroyed through no fault on the part of the person—the full amount of the of insurer’s write-off payment;

 (h) if the person sold or disposed of a motor vehicle or an interest in a motor vehicle within the period of 12 months ending on the date of making a claim—the trade-in value at arm’s length for which that motor vehicle or interest was sold or disposed.

12  Commission may request advice from an approved program provider or an occupational therapist

 (1) The Commission may request advice from an approved program provider or an occupational therapist in relation to the type of motor vehicle, the type of any reasonable accessories and the type of any necessary driving devices or modifications to make the motor vehicle safe and reasonably comfortable at the minimum cost.

 (2) The Commission may take any advice provided under subsection (1) into account when determining the amount of any subsidy under section 10.

13  Circumstances when a person is eligible for a replacement motor vehicle

 (1) Subject to any other provision of this Part, where a person has received a previous motor vehicle, the person is eligible for compensation to assist with the purchase of a replacement motor vehicle under this section if:

 (a) any of the following applies at a time when the person is an eligible person:

 (i) the person’s claim for compensation under this section is made at least 5 years after the person last received compensation under section 7 or section 10; or

 (ii) the person’s previous motor vehicle has travelled at least 100,000 kilometres after it was purchased or modified, whichever last occurred; or

 (iii) the person’s previous motor vehicle was stolen or destroyed through no fault of the person; and

 (b) an approved program provider or occupational therapist has made a written recommendation to the Commission that the approved program provider or occupational therapist is satisfied on reasonable grounds that the person would derive benefit directly from:

 (i) driving a motor vehicle, taking account of the benefits to the person’s physical and mental health and the person’s level of mobility without driving a motor vehicle; or

 (ii) being driven in a motor vehicle, taking account of the benefits to the person’s physical and mental health and the person’s level of mobility without access to a motor vehicle; and

 (c) a qualified mechanic considers that the person’s previous motor vehicle is unsafe, taking into account the previous motor vehicle’s maintenance and service history, and its condition.

 (2) For the purposes of subsection (1), a person is not to be taken to derive direct benefit through the use of the motor vehicle by another person solely for that other person.

14  Determining the amount of any subsidy

 (1) The amount of any subsidy under section 13, is such amount as the Commission considers is reasonable, after deducting the trade-in value at arm’s length of the person’s previous motor vehicle (if any) or interest in a previous motor vehicle and taking account of all the circumstances the Commission thinks are relevant, including all, or any, of the following:

 (a) the nature of the person’s impairment;

 (b) the type and cost of the motor vehicle that the person is proposing to purchase;

 (c) the type and cost of accessories that are reasonably required for the person;

 (d) the type and cost of alternative motor vehicles to the motor vehicle the person is proposing to purchase;

 (e) the ability of the proposed motor vehicle to be fitted with any necessary driving devices or be otherwise modified for the person;

 (f) in relation to a second hand motor vehicle—the number of kilometres travelled by the motor vehicle, the life of the motor vehicle and the possible application of section 15;

 (g) if the person’s existing motor vehicle was stolen or destroyed through no fault on the part of the person—the full amount of the of insurer’s write-off payment.

15  Commission may request advice from an approved program provider or an occupational therapist

 (1) The Commission may request advice from an approved program provider or an occupational therapist in relation to the type of motor vehicle, the type of any reasonable accessories and the type of any necessary driving devices or modifications to make the motor vehicle safe and reasonably comfortable at the minimum cost.

 (2) The Commission may take any advice provided under subsection (1) into account when determining the amount of any subsidy under section 13.

16  Other compensation

 (1) A person is eligible for compensation in the form of a subsidy to assist the person with:

 (a) the cost of insurance insofar as the insurance only relates to any modifications provided under the Scheme; or

 (b) repairs to any modification that have been made as a result of compensation to modify a vehicle under this Scheme.

17  Amount of other compensation

 (1) The amount of compensation under section 16 is equal to:

 (a) the cost of any additional insurance that only relates to the modifications; or

 (b) the cost of the repairs to the modifications.

18  Motor vehicle from another scheme

 (1) A person is not eligible for compensation in the form of a subsidy to assist with the purchase of a motor vehicle under this Scheme if the person receives or has received:

 (a) a payment or any other form of assistance for the purchase of a motor vehicle; or

 (b) a motor vehicle;

  under any other law, contract, agreement or understanding within 5 years before making a claim for compensation under this Scheme.

19  Conditions relating to the compensation payment

 (1) If a person receives compensation in the form of a subsidy to assist with the purchase of a motor vehicle under this Scheme, the person must:

 (a) register the motor vehicle; and

 (b) comprehensively insure the motor vehicle to its full market value.

20  Ownership of motor vehicle

 (1) If a person receives compensation in the form of a subsidy to assist with the purchase of a motor vehicle under this Scheme:

 (a) the person is taken to be the legal owner of the motor vehicle; and

 (b) the motor vehicle cannot be sold, transferred, encumbered or otherwise dealt with without the written agreement of the Commonwealth; and

 (c) it is a condition of the subsidy that the person maintain the motor vehicle in good working order; and

 (d) it is a condition of the subsidy that if the motor vehicle is damaged and the person receives any payment in respect of the damage from an insurer—the person must apply the amount of the payment towards repairing the damage to the motor vehicle or the replacement of the motor vehicle.

Note:  Section 408 of the Act is an offence provision that limits a person’s ability to deal with goods provided under the Act without the Commission’s consent.

 (2) Subject to the operation of this Scheme in relation to future eligibility, the vehicle can be loaned at any time at the person’s discretion.

21  Ongoing expenses relating to the motor vehicle

 (1) Subject to section 16, if a person receives compensation in the form of a subsidy to assist with the purchase of a motor vehicle under this Scheme, the person is wholly responsible for garaging, maintenance, insurance, registration, and operation of the motor vehicle.

Schedule 1—Transitional

1  Definitions

In this Schedule:

commencement day means the day section 1 of this instrument commenced.

former scheme means the Motor Vehicle Compensation Scheme (Instrument 2015 No. MRCC 20) as in force immediately before the commencement day.

2  Process not determined under former scheme

 (1) A process commenced under the former scheme and not determined before the commencement day is taken to have been commenced under the Scheme.

3  Compensation received under former scheme

 (1) A driving or other modification that an eligible person received under the former scheme is taken to have been received under the Scheme for the purposes of the Scheme.

 (2) A motor vehicle that an eligible person received under the former scheme is taken to be a previous motor vehicle for the purposes of the Scheme.

Schedule 2—Amendments

Motor Vehicle Compensation Scheme 2025

1  Subsection 5(1), definition of care institution, paragraph (a)

substitute

 (a) a residential care home (within the meaning of section 10 of the Aged Care Act 2024);

Endnotes

Endnote 1—About the endnotes

The endnotes provide information about this compilation and the compiled law.

The following endnotes are included in every compilation:

Endnote 1—About the endnotes

Endnote 2—Abbreviation key

Endnote 3—Legislation history

Endnote 4—Amendment history

Abbreviation key—Endnote 2

The abbreviation key sets out abbreviations that may be used in the endnotes.

Legislation history and amendment history—Endnotes 3 and 4

Amending laws are annotated in the legislation history and amendment history.

The legislation history in endnote 3 provides information about each law that has amended (or will amend) the compiled law. The information includes commencement details for amending laws and details of any application, saving or transitional provisions that are not included in this compilation.

The amendment history in endnote 4 provides information about amendments at the provision (generally section or equivalent) level. It also includes information about any provision of the compiled law that has been repealed in accordance with a provision of the law.

Misdescribed amendments

A misdescribed amendment is an amendment that does not accurately describe how an amendment is to be made. If, despite the misdescription, the amendment can be given effect as intended, then the misdescribed amendment can be incorporated through an editorial change made under section 15V of the Legislation Act 2003.

If a misdescribed amendment cannot be given effect as intended, the amendment is not incorporated and “(md not incorp)” is added to the amendment history.

Endnote 2—Abbreviation key

Endnote 3—Legislation history

Endnote 4—Amendment history