4.9.1 Overview of New Financial Year Assessments

Summary

The purpose of the new financial year assessment of FTB and CCS individuals (1.1.I.90) is to ensure that CCS individuals and individuals who choose to receive their FTB entitlements through Centrelink as fortnightly payments are assessed against their current circumstances, including an estimate of their annual ATI (1.1.A.20).

New financial year assessment (NFYA)

Centrelink contacts individuals between April and May of each year by a written notice. The notice requests individuals to provide estimates of their and their partner's (1.1.P.30) ATI for the new financial year.

The NFYA letter provides individuals with 2 options to estimate their incomes:

  • the individual can provide their own estimated ATI, or
  • accept an indexed income estimate determined by Centrelink. The indexed estimate (or indexed actual income, where applicable) is calculated by indexing the individual's most recent estimate by movement in the average weekly earnings.

Note: If an individual fails to respond to the NFYA letter, their rate of FTB, or CCS percentage, will be assessed using the indexed estimate amount advised in the letter. If an individual chooses to accept the indexed estimate as provided by Centrelink, or if the indexed estimate is applied by default (because the individual fails to respond), a second indexation process may occur when the individual's actual ATI becomes known. Centrelink will index the actual ATI (as provided by the ATO) by movements in the average weekly earnings. The indexed actual ATI will then be compared to the indexed estimate and the higher amount will be used to determine the individual's rate of payment.

Through the NYFA process, an estimate of income is ascertained and used to determine an individual's rate of FTB and/or CCS percentage from the beginning of the new financial year. Individuals may also choose to revise their income estimate for the current financial year at this time. In addition, CCS individuals are contacted in June and advised of their CCS percentages for the current financial year and the next financial year.

Act reference: FA(Admin)Act section 20 Determination of rate may be based on estimate, indexed estimate or indexed actual income, section 20A Indexed estimates, section 20B Indexed actual incomes, section 20C Indexed estimates and indexed actual incomes of members of couples, section 31A Variation of instalment entitlement determination to reflect revised adjusted taxable income estimates, section 31C Variation of instalment entitlement determination to reflect indexation of estimate of adjusted taxable income, section 31D Variation of instalment entitlement determination to reflect indexation of adjusted taxable income, section 67DB Determinations when adjusted taxable income is not known, section 67DC Indexed estimates, section 67DD Indexed actual incomes, section 67DE Indexed estimates and indexed actual incomes for members of couples

Policy reference: FA Guide 3.5.1 CCS - Combined Annual ATI, 4.9.3 Outcomes of New Financial Year Assessments, 1.1.I.85 Indexed income - actual or estimate (FTB)

New individuals following the NFYA process (FTB)

Individuals, who apply for FTB between the issue of the NFYA letter and the end of the current financial year will be provided with a letter when granted payment. The letter should advise of the estimated income amount that will be used for the new financial year's assessment of FTB. The individual should be encouraged to provide their own estimate at all times. Where the individual is unable to provide an estimate for the new financial year but provides an estimate for the current year, Centrelink should index the amount and advise the individual of the estimate upon which payment will be made following the usual notification rules. The individual should be given the option to accept the Centrelink estimate or to provide their own estimate for the new financial year.

Policy reference: FA Guide 4.9.3 Outcomes of New Financial Year Assessments

New CCS claims following the NFYA process

Individuals who make a new claim (1.1.C.27) for CCS between the issuing of the NFYA letter and the end of the current financial year will be required to give their, and their partner's, estimated ATI for the current financial year, and also their estimated ATI for the new financial year.

Policy reference: FA Guide 3.5.1 CCS - Combined Annual ATI, 4.9.3 Outcomes of New Financial Year Assessments

FTB individual selection

All FTB individuals, except single income support individuals and individuals who have already provided a new financial year estimate at the time of the assessment are contacted as part of the assessment process.

Explanation: Single income support individuals are not contacted for an estimate of income because they are not subject to the income test and therefore receive the maximum rates of FTB Part A and FTB Part B.

Last reviewed: 2 July 2018