Family Tax Benefit changes came into effect this week. How do they affect you and your family?
Background
The Family Tax Benefit (FTB) is a two-part means-tested government benefit designed to help you meet the costs of raising kids.
FTB-A is a per child payment for families with dependent children aged up to 19. FTB-B is targeted at single parent families and lower-income families.
The FTB payments have been around for as long as The Titanic and MMMbop (1997), but this financial year there are some changes to note.
Here’s what you and your family need to be aware of going forward.
Changes for all FTB recipients
If your child is not properly immunised or fails health check requirements, your FTB Part A payments may be reduced by up to $28.28 per fortnight ($737.30 per year), per child.
– Immunisation: Here you can find out about how to meet the minimum immunisation requirements.
– Health check: Your child will also need to undergo an assessment of their physical health – height, weight, hearing, sight and general wellbeing – before they start school. Requirements vary between states and territories so take a look here to find out what you’ll need to do to continue receiving payments.
– Indexation: FTB payments are frozen until 1 July 2020 and will not rise with CPI before then.
Thresholds are also frozen. The FTB Part A higher income free area will remain at $94,316, as will the FTB Part B primary earner income limit of $100,000.
Changes if you receive FTB Part A and an income support payment
As of July 1, you’re no longer exempt from the FTB Part A income test.
That means, if your employment income rises to the point that your income support payment cuts out, you will be subject to the FTB Part A income test.
The government will use your family income estimate to work out how much FTB Part A you get paid. As a result, when your income support drops or cuts out, the same may happen to your FTB Part A payments.
If you receive a letter requesting a family income estimate, it’s important you provide the relevant information within 21 days, otherwise your FTA Part A will be cancelled.
You should also note that your child’s payment may also be affected if your income is used to calculate Youth Allowance, ABSTUDY living allowance, ABSTUDY School Fees Allowance (Group 2) or Assistance for Isolated Children Additional Boarding Allowance.
Get in touch
Each family’s situation is different. And we understand that some scenarios aren’t always clear cut.
So if you’re still unsure about how the FTB changes will affect you and your family, feel free to get in touch.
We’d be more than happy to walk through the changes and answer any questions you may have.
Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.
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