The Guides to Social Policy Law is a collection of publications designed to assist decision makers administering social policy law. The information contained in this publication is intended only as a guide to relevant legislation/policy. The information is accurate as at the date listed at the bottom of the page, but may be subject to change. To discuss individual circumstances please contact Services Australia.

3.3.1 Why provisional incomes are used

Context

Provisional incomes (1.1.P.130) may be used when a parent (1.1.P.10) has not yet lodged a tax return for a relevant financial year (1.1.L.10), or they have lodged a RNN advice with the ATO. They may be used to ensure a parent’s financial capacity is reflected in the child support assessment (1.1.C.70).

As an RNN advice does not provide income information, Services Australia will calculate a provisional income based on the most up-to-date income information (3.3.2).

Provisional incomes seek to:

  • ensure child support assessments are updated regularly even when a parent has not lodged a tax return
  • ensure child support assessments are based on the most current income information available
  • prevent delays to updating the child support assessment when only one parent has lodged their tax return after a financial year
  • encourage parents to lodge their tax returns on time, and
  • minimise the instance of either parent being required to pay a debt or overpayment (1.1.O.20), when a child support assessment is retrospectively updated when the other parent lodges their tax return.

Act reference: CSA Act section 5 Interpretation—definitions, section 5A Definition of annualised MTAWE figure, section 58 to section 58D Determination by the Registrar of a parent’s adjusted taxable income, section 162A Obtaining information in relation to residents of reciprocating jurisdictions

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