220.127.116.11 Assessable Maintenance Income
This topic provides information about assessable maintenance (1.1.M.10) income, and includes the following:
- how maintenance can be received,
- maintenance liability (1.1.M.23), and
- different types of maintenance.
Any benefit or payment for the maintenance of the child and/or the payee (1.1.P.71) is assessable maintenance, unless it is specifically exempt.
Policy reference: FA Guide 18.104.22.168 Exempt Maintenance Income
How maintenance can be received
Maintenance can be received as:
- non-cash maintenance, or
- lump sum payments, or
- capitalised maintenance.
Maintenance can be paid to the payee, or the child. Assessable maintenance includes:
- child maintenance (see explanation 1),
- partner maintenance (see explanation 2), or
- maintenance paid directly to the child.
Explanation 1: Maintenance paid for the child to the payee, grandparent or other person to whom the court has appointed custody of the child.
Explanation 2: Maintenance paid for the payee.
Maintenance can be paid by the other parent of the child, or by the partner or former partner of a parent of the child.
Example: Marie is a payer. She has a maintenance liability for her 2 children. Marie's new partner contributes to the amount of maintenance she pays. The whole amount is assessable for the payee.
The individual must take reasonable action to seek maintenance in order to receive more than the base rate (1.1.B.10) of FTB for a child from a previous relationship. The payer's (1.1.P.72) maintenance liability may be worked out under Stage 1 or Stage 2 of the CSS. The payee can collect their maintenance privately (1.1.P.130), or through Child Support.
Voluntary maintenance (1.1.V.20) is also assessable under the maintenance income test.
Policy reference: FA Guide 22.214.171.124 Taking Reasonable Maintenance Action
Maintenance received as a cash amount or credited to the payee's bank account is cash maintenance. Cash maintenance can be collected by Child Support or privately. The actual amount received is the amount that is assessed.
Non-cash maintenance is a benefit or payment for the maintenance of the child or payee. It may be given directly to the payee or the child, or may be paid to a third party on their behalf.
Examples: The following benefits may be provided as non-cash maintenance:
- food, clothing or other household items or repairs,
- mortgage payments, rent or free lodging,
- health insurance and medical expenses,
- loan, credit card and store account repayments,
- child care fees, school and tuition fees,
- sporting costs including fees, equipment, related travel and accommodation,
- travel or holiday expenses,
- utility bills including electricity, gas, telephone and heating,
- council, water and sewerage rates, and
- motor vehicle expenses.
The value to the individual of the non-cash maintenance is assessable under the maintenance income test.
When deciding if the benefit or payment should be assessed as maintenance, the following 3 points should be considered:
- is the payment from (directly or indirectly), a parent of the child/ren or a partner or former partner of a parent of the child/ren, and
- has the payment or benefit been received, and
- is the payment for the support of the payee or the child/ren?
If the answer to all of the above is yes, then the payment or the value of the benefit may be assessed as non-cash maintenance. If the answer to any of the above questions is no, then the payment or the value of the benefit is not considered as maintenance.
The facts of each individual case should be taken into account. What is significant is the nature and purpose of the payment.
Capitalised maintenance income
Capitalised maintenance is maintenance that is paid as a lump sum to satisfy a maintenance liability for a period of time. Capitalised maintenance is apportioned over the period.
Policy reference: FA Guide 126.96.36.199 Capitalised Maintenance