# 3.1.11 Advance Payment of FTB Part A

## Introduction

The amount of FTB advance payable to an individual is the smaller of the amount sought by the individual or the maximum amount of advance payable less the original amount of any previous unrepaid FTB advances.

In the alternative, an FTB advance amount can be determined at the discretion of the Secretary. This amount has to be more than the minimum amount and less than the maximum amount and/or the amount sought by the individual.

Minimum (1.1.M.55) and maximum (1.1.M.25) FTB advance amounts are determined with reference to a family's instalment rate of FTB Part A, excluding the FTB Part A supplement, and before any existing advance rate reductions payable to the family on the advance assessment day (1.1.A.55).

For a detailed explanation of the maximum FTB advance amount available to an individual see 1.1.M.25.

For a detailed explanation of the minimum FTB advance amount available to an individual see 1.1.M.55.

## Blended families

The blended family's maximum advance amount will be calculated as a whole as above, and then each individual will be able to claim their blended family percentage of this maximum (i.e. the individual's blended family percentage of the family's maximum advance becomes the individual's maximum advance). Similarly, the blended family percentage of the family's minimum advance becomes the individual's minimum advance.

## Discretion of the Secretary

The Secretary may determine that a lower amount of FTB advance is to be paid if the Secretary is satisfied that the individual would suffer financial hardship if their Part A rate were reduced to repay the greater amount.

An example is where the repayment period (1.1.R.33) of the advance is known to be shorter than 182 days because the individual's eligibility for FTB will cease at an earlier time, such as if the their only child will cease to be an FTB child (2.1.1.10) due to their age.

Other circumstances which may impact on the advance amount and/or eligibility include (but are not limited to) where an individual advises Centrelink of an event which will impact on the eligibility in the future, such as:

- the individual advises Centrelink that they will be moving overseas permanently at a particular future date, or
- the child has pre-claimed YA where they are due to turn 18 or complete secondary study, or
- a carer will have less than 35% of the care of a child from a particular date onwards, etc.

**Example:** Martin is eligible for a maximum $500 advance based on his rate of FTB Part A. However, the payment is scheduled to cancel in 100 days as he is leaving Australia permanently, so the repayment period is 100 days instead of 182 days. It is considered that the daily repayment of $5 ($500 ÷ 100) would result in financial hardship, but the equivalent daily repayment for $500 over 182 days would not cause financial hardship.

Therefore, exercising the discretion, the maximum advance amount would be $500 ÷ 182 × 100 = $274.72. As this is greater than the minimum amount (1.1.M.55), the advance of $274.72 would be granted. The daily repayment over 100 days would be $274.72 ÷ 100, which is the equivalent daily repayment to what would be applied if he repaid $500 over 182 days.

If the Secretary is to exercise this discretion, the advance amount must be at least the minimum amount.

In the example above, if the maximum advance based on Martin's rate of FTB Part A was $250, the advance would not be granted as $250 ÷ 182 × 100 = $137.36, which is less than the minimum amount.

**Act reference:** FA(Admin)Act section 35C Amount of FTB advance

## Reduction in advance amount due to repayment of a previous advance

If a previous advance is being repaid when an individual requests a new FTB advance, the maximum advance amount for the new FTB advance is reduced by the original amount of any unrepaid FTB advance. This reduced amount would need to be at least the minimum amount (1.1.M.55) in order for the individual to qualify for a new advance.

**Example:** Tony is eligible for a maximum $1000 advance based on his current FTB Part A rate. He claims a $400 advance, then, during the repayment period for the $400 advance he requests a further advance. As Tony has not yet fully repaid the $400 advance, the maximum amount available to him at this point in time is his maximum advance amount ($1000), reduced by the original amount of any advance/s he has not fully repaid ($400). Therefore, his maximum advance amount at the time of the second request is $600.

**Note:** For the purposes of calculating an individual's maximum advance amount as above, outstanding advances with balances of less than 5 cents are disregarded. Disregarding an advance with a remaining balance of less than 5 cents allows the original amount of the outstanding advance to become available again, despite the remaining balance not being recovered until the individual's next FTB instalment payment.

## Advance ceiling

The advance ceiling is the absolute maximum advance amount that an individual may be able to receive. It is set at 23.3% of the maximum standard rate for one child aged under 13.

**Act reference:** FA(Admin)Act section 35C Amount of FTB advance

**Policy reference:** FA Guide 1.2.8.10 FTB Advance Payments - Details