4.3.1.10 FTB Payment Delivery Choices

Summary

This topic outlines the payment options available for FTB. It covers:

  • payment options,
  • payment of FTB advances,
  • delivery choices for individuals who receive FTB by instalment,
  • individual or partner is receiving income support,
  • FTB delivery method, and
  • payment of FTB supplements may be conditional.

Payment options

If the claimant is… Centrelink can pay FTB by…
an individual (1.1.I.90),
  • fortnightly instalments, or
  • a lump sum,
an ACO (1.1.A.80),
  • fortnightly instalments, or
  • a lump sum.

Note: FTB lump sum claims will not be processed until the individual (and their partner if they have one) have lodged an income tax return for the same income year as the claim, or have notified Centrelink that they are not required to do so.

If an individual lodges a combination claim for both a past period and instalments, both the lump sum payment and instalments of FTB are paid following determination of the claim.

A stand-alone claim for a past period is effective (1.1.E.10) only after the end of the relevant income year. In this situation, the lump sum can only be paid after the end of the income year.

An individual who receives FTB by instalments must provide their bank account details for the direct credit of FTB unless an exemption has been granted. If an exemption has been granted, FTB may be paid by other means. The FTB Part A and Part B supplements are not included in the instalment payments as these can only be paid as part of the reconciliation process.

Payment of FTB advances

A portion of FTB may also be paid as an FTB advance. When an individual receives an FTB advance, their ongoing FTB Part A rate is reduced to repay the advance (1.2.8.10).

FTB Payment Delivery Choices may be impacted by the receipt or repayment of an FTB advance.

Act reference: FAAct Schedule 1 clause 5 FTB advance to individual, Schedule 1 clause 25A FTB advance to individual

Policy reference: FA Guide 1.2.8.10 Advance Payment of FTB Instalments

Delivery choices for individuals who receive FTB by instalments

Generally, individuals who receive FTB by instalments can choose to receive their payments fortnightly through Centrelink or defer payment of some or all of their FTB until the end of the income year.

While ES aligns with FTB in many ways, individuals can elect to receive their ES payments quarterly (4.3.1.25). However individuals who elect to receive their ES payment quarterly should be aware that a More Choice For Families (MCFF) deferral option may override their election to receive ES as a quarterly payment.

In order to help individuals reduce the chance of being overpaid FTB, a series of options to help families match payments to their circumstances are available under MCFF initiatives (4.3.1.20).

Mandatory continuous adjustment applies to individuals who receive FTB by instalments where required. Individuals who notify an increased estimate to Centrelink, or who have their income estimate or actual income automatically uplifted by Centrelink, will have their daily rate of FTB for the remainder of the income year adjusted automatically to avoid or reduce a projected FTB overpayment. Mandatory continuous adjustment also applies where an instalment claimant's estimate of maintenance income is increased during the income year.

Where an individual's rate of FTB is subject to continuous adjustment, any future increase or decrease in the individual's income estimate for that income year will require re-calculation of the adjustment necessary to their daily rate for the remainder of the income year, based on the revised income estimate.

Individuals will have the following choices in regard to how they receive their FTB payments under the MCFF deferral options, but cannot use these options to increase fortnightly payments above an amount set by continuous adjustment:

  • Deferring payment of one FTB fortnightly payment: Individuals can receive one FTB payment (Part A or B) as a fortnightly payment and the other as a lump sum payment at the end of the income year.
  • Deferring payment of more than base rate FTB Part A: Individuals can choose to take a base rate FTB Part A payment fortnightly and receive the rest at the end of the year.
  • Deferring payment of more than base rate FTB Part A other than RA: Individuals who receive RA with more than base rate FTB Part A can choose to retain fortnightly payment of their RA and base rate FTB Part A and defer the rest of their more than base rate FTB Part A.
  • Deferring FTB Part A other than RA: Individuals who receive RA with their FTB Part A are able to choose to retain fortnightly payment of their RA and defer the payment of FTB Part A until the end of the year.
  • Payment will be made following the reconciliation process.

Note: An individual's payment choice will remain in place until such time as the individual's circumstances are reassessed. If the individual chooses to revoke selected payment choice, any arrears owing will not be paid until after reconciliation unless the individual can provide sufficient detail about financial hardship.

Act reference: FA(Admin)Act section 7A Bank account details or statement to be provided for claims for FTB by instalment to be effective, section 35A Entitlement to FTB advance, section 35C Amount of FTB advance, section 35E Payment of advance

Policy reference: FA Guide 1.2.8 FTB Advance - Description, 4.3.3 Instalments Paid by Direct Credit, 4.3.4 Instalments Paid by Other Means, 4.3.5 Lump Sum Payment through Centrelink, 4.3.1.20 FTB Payment Choices for Instalment Individuals, 4.3.1.30 Mandatory Continuous Adjustment of FTB Instalments, 4.4.2.30 Date of Effect Rules - FTB Payment Choices

Individual or their partner is receiving income support

For a claim to be effective, a past period claim for FTB must be combined with an instalment claim for FTB, when an individual or their partner (1.1.P.30) is receiving income support, including a:

The individual or their partner must also have been receiving one of the above-mentioned payment types at any time during the past period for which FTB is being claimed.

Note: The above conditions do not apply if the individual is no longer entitled to FTB payments based on an estimate (6.4.3.70).

Act reference: FA(Admin)Act section 10(3) to 10(4) Claim must be accompanied by instalment claim in some circumstances

FTB delivery method

Where an individual or their partner is receiving an income support payment they must claim FTB by instalments if they lodge a past period (lump sum) claim for FTB for a previous income year in which they or their partner were at some stage receiving income support, even if they are unsure if they would have an ongoing entitlement.

The individual does not need to lodge an instalment claim with their past period claim if they have no ongoing entitlement to FTB via instalments and/or income support. This situation could arise where the individual may not be entitled to FTB because they no longer have or do not expect to have a child in care; or they may no longer be entitled to FTB by instalment due to the sunset clause under the prohibition of instalment payments policy.

Example: Penelope is paid NSA. In May 2014, she makes a lump sum claim for FTB for their child Deloris for the 2012-13 year. As Penelope receives an income support payment and continues to have Deloris in her care, she must also apply for FTB by instalments at the time of her lump sum claim, otherwise her lump sum claim will be non-effective.

Example: Sandra and Don have had their ongoing FTB entitlement removed due to the sunset clause. In April 2014 Sandra is granted CP and makes a lump sum claim for the 2012-13 year for FTB for her daughter. As Sandra has no ongoing entitlement to FTB due to the sunset clause, she cannot make an instalment claim. Sandra will need to lodge a lump sum claim at the end of each income year that she wishes to be paid FTB, at least until her non-entitlement has been resolved.

Act reference: FA(Admin)Act section 10 Restrictions on claims for payment of FTB for a past period

Policy reference: FA Guide 6.4.3.70 Non-entitlement to FTB Based on an Estimate Due to 3 or More Non-lodger Decisions

Payment of FTB supplements may be conditional

For individuals who are required to lodge a tax return, the FTB Part A and/or Part B supplement can only be paid after the end of the income year when all relevant tax returns and other income details are available. An individual (and their partner if they have one) who is not required to lodge a tax return needs to notify Centrelink before any FTB supplements can be paid.

For most families, additional conditions also apply to the payment of the FTB Part A supplement:

  • From 1 January 2016, the FTB Part A supplement is conditional on immunisation requirements (1.1.I.10) being met for the income year in which an FTB child is aged 1 and in each income year after that up to and including the age of 19. Prior to this date, only children who turned 1, 2 or 5 years in the relevant income year were required to meet the immunisation requirements.
  • For the income year in which a child turns 4 years the supplement for the child may be conditional on the completion and notification of a health check for the child, where the parent or carer also receives income support (1.1.H.05), and
  • from 1 July 2016, the FTB Part A supplement is not payable when the combined adjusted taxable income is more than $80,000 for the relevant income year.

The FTB supplements can only be paid to individuals. This means FTB supplements are not available to ACOs.

Note: If an individual (and their partner if they have one) fail to lodge a tax return by the end of the income year following the year of entitlement, then they are no longer entitled to FTB for the relevant income year and any FTB paid for that year will be raised as a debt. This also applies to those who are not required to lodge but who do not notify Centrelink of this fact.

Act reference: FAAct Schedule 1 clause 38A Rate of FTB Part A supplement, Schedule 1 clause 31A Rate of FTB Part B supplement, section 61A FTB Part A supplement to be disregarded unless health check requirement satisfied, section 61B FTB Part A supplement to be disregarded unless immunisation requirements satisfied

FA(Admin)Act section 10(3) to 10(4) Claim must be accompanied by instalment claim in some circumstances…, section 28 Variation of instalment and past period entitlement determinations where income tax return not lodged, section 32A FTB Part A supplement and FTB Part B supplement to be disregarded unless and until individual has satisfied the FTB reconciliation conditions

Policy reference: FA Guide 4.2 Claims for FTB

Last reviewed: 8 May 2017