Method 2 - FTB Part A Income Test

Income test - FTB Part A Method 2

The income test assesses whether an individual and/or their partner's (1.1.P.30) ATI (1.1.A.20) is greater than their higher income free area (1.1.H.10). If their income is more than the higher income free area, the rate of FTB is reduced as described below.

Reduction after reaching the higher income free area

When an individual and/or their partner's ATI exceeds their higher income free area, their FTB Part A is reduced by 30% of the income excess until FTB Part A is no longer payable. This reduction from the maximum rate (1.1.M.26) results in the individual's provisional FTB Part A rate.

Note: In some situations, the FTB rate resulting from the Method 1 income test is payable when the family's ATI is above the higher income free area. See

Act reference: FA(Admin)Act section 20A Indexed estimates, section 20B Indexed actual incomes

Policy reference: FA Guide 1.1.I.85 Indexed income - actual or estimate (FTB), Method 2 - Calculating the Maximum Rate of FTB Part A

Last reviewed: 11 May 2015