You would have to select VA compensation in lieu of retired pay on the VA claim for compensation (not "pension" in this case).
Part V - Military Retired/Severance Pay What If I have received or will receive military pay?
This section asks about your military severance or separation pay, the type, and the amount. If you currently receive military retired pay, we may reduce your retired pay by the amount of any compensation that we award. It is to your advantage because VA compensation is not taxable while retired pay is taxable. However, if you wish to receive military retired pay rather than VA compensation, you must check the box in Item 25. Some veterans receive various readjustment, separation, or severance pay from service departments which may be recouped in full or in part from VA benefit payments.
The above was taken from a 2014 version of VA Form 526, VETERAN'S APPLICATION FOR COMPENSATION AND/OR PENSION. There might be more recent versions.
Ron
Added:
https://www.vba.va.gov/pubs/forms/VBA-21-526ez-ARE.pdf is a 2018 EZ version.
See Section VI:
IMPORTANT INFORMATION ON MILITARY RETIRED PAY (Includes all Uniformed Services Retired Pay): Submission of this application constitutes a waiver of military retired pay in an amount equal to VA compensation awarded, if you are entitled to both benefits. Your retired pay may be reduced by the amount of VA compensation awarded. Receipt of the full amount of military retired pay and VA compensation at the same time may result in an overpayment, which may be subject to collection. If you qualify for concurrent receipt of VA compensation and military retired pay, the waiver of retired pay will not apply. If you do not want to waive any retired pay to receive VA compensation, you should check the box in Item 26.
Note that if you check the box in Item 26, you will not receive VA compensation, if granted. If you are currently in receipt of VA compensation and you check the box in Item 26, your VA compensation will be terminated, if you are also eligible for military retired pay. IMPORTANT: VA COMPENSATION PAY IS NON-TAXABLE. THEREFORE, VA COMPENSATION PAY MAY BE THE GREATER BENEFIT.
24A. ARE YOU RECEIVING MILITARY RETIRED PAY? (If "Yes," complete Items 24C and 24D) 24B. WILL YOU RECEIVE MILITARY RETIRED PAY IN THE FUTURE?
26. Do NOT pay me VA compensation. I do NOT want to receive VA compensation in lieu of retired pay [DO NOT CHECK THIS BLOCK...RG]