In this article, we will be breaking down the 2nd component of the Family Assistance payment, the Family Tax Benefit Part B. Outlining what it is, how it works and if eligible, how it can improve the quality of life for your family.
This article is in partnership with our Family Tax Benefit Part A blog, where we outlined why it’s important that you’re aware of family assistance and social security payments available to you, and went into detail about the first component of the Family Tax Benefit.
What is The Family Tax Benefit Part B?
The Family Tax Benefit Part B is a payment per family for single parent households and/or two parent households, where there is a reliance on one parents’ income as a main source of income.
This payment is available due to recognition that some parents are unable to work due to raising children.
How Much Can I Receive, and How Do I Receive It?
If your family is eligible, you will receive payment on a fortnightly or annual basis at the end of the financial year. Unlike Part A, Part B is a per-family payment, so the number of children you are raising doesn’t affect the amount you receive. If eligible, these payments will be made to your bank, credit union or building society account.
The amount payable is based on the youngest child in the family, where the maximum rate payable per family is:
- $168.28 per fortnight or $4,375.28 annually, when the youngest child is between 0 to 5 years of age.
- $117.46 per fortnight or $3,053.96 annually, when the youngest child is between 5 to 18 years of age.
Depending on your circumstance, you may also be eligible for an emergency supplement, which can slightly increase the amount payable.
Family Tax Benefit Part B Supplement
In addition to any Family Tax Benefit Part B payments that you may be receiving, you may also be eligible to receive the Family Tax Benefit Part B Supplement.
The Part B Supplement is a $397.85 per family payment, that is only payable after the end of the income year. This payment will be made once you lodge your tax return for the year and the DHS balances your income to ensure you have been paid appropriately.
Eligibility Criteria For The Family Tax Benefit Part B Supplement
In order to receive the Family Tax Benefit Part B payments, you must meet the criteria listed below:
- A member of a couple with 1 main income source and care for a dependent child under the age of 13; or
- A single parent or non-parent carer, or a grandparent carer and care for a dependent child under the age of 18. However, the child must meet certain study requirements if between the ages of 16-18
Study requirements include:
- Being in full time secondary study in an approved course leading to a year 12 or similar qualification with an acceptable study load; or
- Has been granted an exemption from the Department of Human Services
The claiming parent and Family Tax Benefit child, unless living with the parent, must also meet certain residency requirements including having 1 of the following:
- Australian citizenship
- A permanent visa
- A special category visa
- A certain temporary visa type such as partner provisional or temporary protection visa
The claiming parent must also care for the Family Tax Benefit child for a minimum of 35% of the time and the claiming parent or family must meet an income test. If the claiming parent or partner are currently receiving Parental Leave Pay, they are not eligible to receive the Family Tax Benefit Part B.
Family Tax Benefit Part B Income Test
The income test for Family Tax Benefit Part B payments is dependent on the category of family claiming, which means the income test assessment criteria will differ accordingly.
Income Test for Single Parent or Carer Families
For single parents or carer families, you will be ineligible to receive any Family Tax Benefit Part B payments if your annual adjusted taxable income is more than $104,432.
Should you fall under this threshold, you will be eligible for the maximum rate of the Family Tax Benefit Part B payments based on the age of your youngest child.
Income Test for Two Parent or Carer Families
For families with two parents or carer families, you will be ineligible to receive the benefit if the primary earner is earning above $104,432. The primary earner is the parent who generates the most income. The parent who earns less, referred to as the secondary earner, determines how much payment you can receive.
The secondary earner can earn up to $6,059 per annum before the Family Tax Benefit Part B payments are reduced. For every dollar earned above this threshold by the secondary earner, the payment reduces by $0.20.
This means that assuming the primary earner generates an annual income of less than $104,432, a two parent or carer family can continue to receive some of the payment as long as the secondary earners income is less than:
- $29,985 per annum, assuming the youngest child is under the age of 5; or
- $23,360 per annum, assuming the youngest child is between the ages of 5 and 18.
Overall, the Family Tax Benefit Part B payment can significantly assist you if you’re relying on one main source of income to raise your children. The benefit can provide much needed breathing space for families to make ends meet.
Yield Financial Planning is Here to Help
As Financial Planners, the team at Yield are specialists in navigating the rules and eligibility criteria of social security and family assistance benefits. We incorporate eligibility to Centrelink entitlements into our financial plans. If you are interested in discussing a financial plan, please contact us.