Use of Discount Tables in Personal Injury Litigation
- Arnold Shields
- Oct 8, 2009
- 2 min read
Updated: Jun 24
What Are Discount Tables?
In personal injury litigation, discount tables are used to calculate the present value of a future economic loss, usually a loss of earning capacity. Rather than adding up future weekly losses at face value, courts apply a discount rate to reflect the fact that receiving money now is worth more than receiving the same amount in the future.
Two types of multipliers are commonly used:
Weekly Multiplier – the present value of receiving $1 per week for a certain number of years.
Deferred Multiplier – the present value of receiving $1 once, at a future date.
Example 1 – Use of Weekly Multiplier
A plaintiff is assessed to have a weekly loss of $500 for 20 years. If the discount rate is 5%, the relevant multiplier (from the discount tables) is 666.4.
Calculation:
$500 x 666.4 = $333,200
This figure represents the present value of that future weekly loss.
Example 2 – Use of Deferred Multiplier
Suppose a plaintiff will incur a one-off loss of $100,000 in 10 years (e.g. a lump sum career loss or medical cost). The 5% deferred multiplier for 10 years is 0.614.
Calculation:
$100,000 x 0.614 = $61,400
This is how much that future payment is worth today.
Example 3 – Combined Weekly and Deferred Multipliers
Let’s say a plaintiff will lose $500 per week, but not immediately—the loss starts in 10 years and continues for 20 years. You need both multipliers:
Deferred multiplier (10 years at 5%) = 0.614
Weekly multiplier (20 years at 5%) = 666.4
Calculation:
$500 x 0.614 x 666.4 = $205,585
This method accurately captures the delayed start and the duration of the loss.
Use Our Free Discount Table Calculator
Dolman Bateman offers a free Discount Table Calculator to simplify these calculations. You can select your jurisdiction, discount rate, and time frame.
👉 Try it here: Discount Table Calculator
Discount Rates by Legislation
The discount rate applied depends on the jurisdiction and relevant statute. Here are the current rates:
Jurisdiction & Act | Section | Discount Rate |
NSW - Motor Vehicle Accidents Compensation Act 1999 | s.127 | 5% |
NSW - Civil Liability Act 2002 | s.14 | 5% |
NSW - Workers Compensation Act 1987 | s.151J | 5% |
VIC - Transport Accident Act 1986 | s.173 | 6% |
VIC - Wrongs Act 1958 | s.28I | 5% |
VIC - Accident Compensation Act 1985 | s.134AB | 6% |
Why It Matters
Correct use of discount tables ensures fair and consistent compensation. Courts, lawyers and forensic accountants rely on these calculations to avoid overestimating or underestimating damages, especially over long periods.
Need help with a personal injury matter involving loss of income? Contact our team at Dolman Bateman, we’ll work through the numbers with you.
Disclaimer:
The information provided in this article is general in nature and does not constitute personal financial, legal or tax advice. While every effort has been made to ensure the accuracy of this content at the time of publication, tax laws and regulations may change, and individual circumstances vary. Dolman Bateman accepts no responsibility or liability for any loss or damage incurred as a result of acting on or relying upon any of the information contained herein. You should seek professional advice tailored to your specific situation before making any financial or tax decision.
