What Is Capacity Building – Improved Daily Living in the NDIS?

Reading time: 10 minutes  |  Updated: April 2026  |  Written by: TEAH Allied Health Team

If you have an NDIS plan, you have probably seen the term Capacity Building — Improved Daily Living somewhere in your funding breakdown. It may have a dollar amount next to it, or it may be absent from your plan entirely. Either way, understanding what this budget category actually covers — and how to make the most of it — can make a significant difference to the supports you are able to access.

Improved Daily Living (IDL) is the NDIS funding category that pays for occupational therapy, speech pathology, physiotherapy, psychology, and most other allied health services in a participant’s plan. It is one of the most valuable — and most underutilised — parts of the NDIS funding framework. This guide explains exactly what it covers, what it does not, how to check if you have it, and how to use it strategically to unlock other supports.

What Is Capacity Building in the NDIS?

Every NDIS plan is divided into three broad budget categories. Understanding where Capacity Building sits within this structure is the starting point for understanding IDL.

Capacity Building is the investment arm of the NDIS. Whereas Core Supports fund the help you need right now, Capacity Building is meant to fund supports that build your skills, reduce your dependence on ongoing funded assistance, and help you live more independently over time. The NDIS’s philosophy is that a dollar spent on therapy today should, over time, reduce the dollars needed for daily support.

Capacity Building is divided into eight subcategories. Each subcategory has its own ring-fenced budget — you cannot move money freely between them. The subcategory that covers the vast majority of allied health services, including all occupational therapy, is Improved Daily Living.

What Is Improved Daily Living Specifically?

Capacity Building — Improved Daily Living (support purpose code 15) funds assessment, training, and therapy that helps a participant develop skills, build capacity, and participate more fully in the activities of daily life. In plain language: it pays for the allied health professionals who assess your needs, deliver therapy, and write the clinical reports your NDIS plan relies on.

The NDIA describes the purpose of IDL as helping participants to “develop, improve or maintain their independence and community participation skills.” This encompasses a wide range of activity — from a one-off assessment that takes two hours, to a structured twelve-week therapy program, to ongoing consultations that support a participant across multiple plan years.

What Does Improved Daily Living Fund?

IDL covers a broader range of supports than most participants realise. Here is a comprehensive breakdown of what it funds:

Allied health assessments

Any assessment conducted by a qualified allied health professional that is related to your disability and NDIS goals is fundable under IDL. This includes:

• Functional Capacity Assessments (FCAs) — the comprehensive OT evaluation that documents your support needs across all areas of daily life. Learn more about what an FCA involves →
• Home modification assessments — on-site OT evaluations that identify access barriers in your home and produce reports for Capital Supports funding. What a home modification assessment includes →
• Assistive technology assessments and prescriptions — OT evaluations that identify, trial, and prescribe AT funded through your Capital Supports budget. How AT assessments work →
• SIL and SDA assessments — OT reports that support applications for Supported Independent Living and Specialist Disability Accommodation. SIL and SDA assessment guide →
• Speech pathology assessments — communication, swallowing, and language assessments conducted by a speech pathologist
• Physiotherapy assessments — movement, strength, and mobility assessments
• Psychology assessments — functional assessments related to mental health, behaviour, and cognitive capacity
• Positive behaviour support assessments — functional behaviour assessments that inform Behaviour Support Plans

Individual therapy sessions

One-on-one therapy delivered by a qualified allied health professional — occupational therapist, speech pathologist, physiotherapist, psychologist, or positive behaviour support practitioner — is funded under IDL when it is:

• Goal-directed and aligned with the participant’s NDIS plan goals
• Delivered by an appropriately qualified and registered professional
• Designed to build capacity rather than simply maintain current function
• Related to the participant’s NDIS disability, not a general health condition

Group therapy

Therapy delivered in a group setting — such as a social skills group for participants with ASD, a fine motor group for children, or a life skills program — is fundable under IDL. Group therapy rates are lower per participant than individual therapy, making it a cost-effective way to stretch limited IDL budgets while still accessing clinical expertise.

Report writing and non-face-to-face work

The NDIS allows allied health providers to claim for the time they spend writing reports, completing clinical documentation, reviewing existing assessments, and communicating with other providers — up to a reasonable limit. For OTs, this is particularly important because NDIS reports are detailed clinical documents that can take many hours to produce.

Support worker and carer training

An allied health professional can be funded under IDL to train your support workers or family members in specific techniques relevant to your care — manual handling, communication strategies, sensory regulation approaches, behaviour response protocols, or safe use of assistive equipment. This is an underused but high-value use of IDL funding.

Telehealth allied health services

Therapy and some assessment services delivered via video call are fundable under IDL at the same rates as in-person services. Telehealth is particularly valuable for participants in regional and remote areas where local allied health services are scarce.

AT fitting, training, and handover

When your assistive technology is delivered, the OT’s time spent fitting, adjusting, and training you and your support workers to use the equipment is funded from IDL — even though the equipment itself came from Capital Supports.

OT costs calculated at $193.99/hr (2025–26 NDIS weekday rate). Psychology and speech pathology rates vary — confirm with your provider.

Improved Daily Living vs Core Supports — What’s the Difference?

This is one of the most common points of confusion for participants and families navigating an NDIS plan. The distinction is fundamental — and getting it wrong means either trying to fund therapy from the wrong budget, or missing out on therapy entirely because you don’t know which budget to look in.

Which Allied Health Professionals Can I Access Through IDL?

Improved Daily Living is not limited to occupational therapy. The budget funds a wide range of qualified allied health professionals, as long as the services they provide are related to your NDIS disability and your plan goals.

TEAH provides occupational therapy, speech pathology, and physiotherapy services across WA, NT, QLD, and Victoria — all fundable from your Improved Daily Living budget.

How to Use IDL Strategically — Assessments That Unlock Other Funding

One of the least understood aspects of IDL is how it acts as a gateway to other, much larger forms of NDIS funding. Certain OT assessments funded by IDL produce clinical reports that directly unlock Capital Supports — funding that can be worth tens or even hundreds of thousands of dollars.

This means that a well-timed IDL investment in an OT assessment can return many times its cost in new funding access.

How Much IDL Funding Should Be in My Plan?

There is no standard IDL allocation. The amount included in your plan depends on what you can demonstrate you need — which is itself determined largely by the clinical evidence submitted at your last plan review. Participants with the same disability can end up with wildly different IDL allocations depending on how thoroughly their therapy needs were documented.

As a practical guide, here is how IDL allocations tend to vary by need level:

If your current IDL allocation feels insufficient for the therapy your condition genuinely requires, the solution is better clinical evidence at your next plan review — which means engaging an OT or allied health professional well before your review date to document your needs comprehensively.

What If IDL Is Not in My Plan?

If you look at your NDIS plan and find no Capacity Building — Improved Daily Living allocation, it means either the NDIA did not include it at your plan meeting, or the clinical evidence submitted at the time did not support including it. This is unfortunately common — and it is fixable.

Request a plan variation

If your therapy needs are urgent — for example, you need an FCA to support an imminent plan review, or you need an AT assessment for equipment that is affecting your daily safety — contact the NDIA and request a plan variation. A plan variation is an amendment to your current plan without a full review. You will need supporting evidence from your GP, support coordinator, or an existing allied health provider explaining why the IDL funding is needed now.

Prepare thoroughly for your next plan review

If your therapy needs are not immediately urgent, the most effective approach is to document them clearly before your next scheduled plan review. Gather supporting letters from your GP and any current allied health providers, and if possible, commission a private OT assessment that documents your therapy needs — which can then be submitted as evidence to include IDL funding in your next plan.

Talk to your support coordinator

If you have a support coordinator, they should be actively advocating for IDL funding on your behalf. If your support coordinator has not raised the absence of IDL in your plan, bring it up at your next meeting. Access to therapy is a fundamental part of the NDIS’s purpose — a plan without any IDL funding should be questioned.

Getting the Most from Your IDL Budget

1. Plan your therapy year before the money arrives. Identify your highest-priority OT and allied health needs at the start of your plan year — and book appointments early. IDL budgets that sit untouched for the first nine months of a plan are frequently underused or lost at plan expiry.
2. Start with assessments, not just therapy. If you have not had a recent FCA or AT assessment, prioritise those first. They produce clinical reports that may unlock significantly more funding — both Capital Supports and additional IDL in your next plan — making subsequent therapy more fundable.
3. Use your IDL budget to justify more IDL in your next plan. The NDIA bases your next plan’s IDL allocation partly on how much you used in the current plan and what your allied health providers recommend. Consistent, well-documented therapy use, with clear goal-progress notes from your OT, is the strongest foundation for a larger allocation next time.
4. Don’t let your IDL budget expire unused. Unspent Capacity Building funding generally does not roll over. Set a calendar reminder three months before your plan expiry to review your IDL balance and schedule any remaining appointments.
5. Ask your OT to write goal-aligned progress notes. For every therapy session, your OT should be documenting progress toward your NDIS goals. These notes are the evidence base for retaining or increasing your IDL allocation at plan review — and they protect against the NDIA questioning whether therapy is producing measurable outcomes.
6. Consider group therapy to extend your budget. If your IDL budget is limited, group therapy delivered by a qualified OT or speech pathologist costs roughly half the individual rate per person. It is not right for every participant, but for social skills, life skills, and some fine motor programs it can be highly effective and cost-efficient.

Frequently Asked Questions

Summary

Capacity Building — Improved Daily Living is the NDIS funding subcategory that makes therapy, assessments, and allied health supports possible. It covers the full range of OT services — from Functional Capacity Assessments and home modification reports through to ongoing individual therapy and support worker training — as well as speech pathology, physiotherapy, psychology, and more.

Used strategically, IDL funding is far more than a therapy budget. It is the gateway to Capital Supports for assistive technology and home modifications, the clinical evidence base for SIL and SDA applications, and the foundation of every NDIS plan review. Understanding how it works — and using it deliberately — is one of the most effective things a participant or support coordinator can do to maximise outcomes under the scheme.

TEAH works with NDIS participants across Darwin (NT), Perth (WA), Brisbane (QLD), and Victoria to make the most of every dollar of Improved Daily Living funding — with assessments that produce NDIA-quality reports and therapy programs aligned to measurable goals.