1.2.1 Family tax benefit (FTB) - description
This section includes information on:
- FTB objectives
- FTB eligibility
- FTB Part A components
- FTB Part B components
- determining FTB rates
- FTB payment options
- FTB end of year supplements
- supplementary benefits, and
- background to FA payments.
FTB consists of 2 parts FTB Part A and FTB Part B.
FTB Part A is designed to help families with the cost of raising children. Payment of FTB Part A is based on the combined income of a family, and is paid in respect of each eligible FTB child (2.1.1).
FTB Part B provides extra help for single parent families and couple families (1.1.M.50) with one main income earner.
Act reference: FAAct section 21 When an individual is eligible for FTB in normal circumstances, section 34 When an approved care organisation is eligible for FTB, section 35 When an approved care organisation is not eligible for FTB, Part 3 Division 1 Eligibility for FTB
FTB Part A components
The rate of FTB Part A includes:
- the individual's standard rate of FTB Part A, and
- the ES Part A, plus
- the end of financial year FTB Part A supplement, which may be paid at reconciliation.
Individuals may also be eligible for:
- NBS for newborn FTB children, FTB children aged less than one year who are entrusted to care or FTB children who are entrusted to care as part of an adoption process
- NBU for FTB children who are eligible for NBS
- MBA for 3 or more FTB children born in the same multiple birth
- who are under the age of 16, or
- who have turned 16, where at least 3 of the children are undertaking full-time secondary study, until the end of the calendar year in which the first born of the children who are undertaking full-time secondary study turns 18, and/or
- rent assistance.
Policy reference: FA Guide 1.1.S.103 Standard rate (FTB), 184.108.40.206 Rent assistance, 220.127.116.11 Current FTB rates & income test amounts, 18.104.22.168 Method 1 - calculating the maximum rate of FTB Part A, 22.214.171.124 Method 2 - calculating the maximum rate of FTB Part A, 1.2.10 Energy supplement (ES) - description, 126.96.36.199 Current ES rates
FTB Part B components
The rate of FTB Part B includes:
- the individual's standard rate of FTB Part B, and
- the ES Part B, plus
- the end of financial year FTB Part B supplement, which may be paid at reconciliation.
Determining FTB rates
FTB Part A is paid at different rates depending on:
- the individual's and their partner's (1.1.P.30) combined ATI (1.1.A.20), and
- the number and ages of eligible children in the family.
Families may also be eligible for RA if an FTB child or regular care child in the family is also an RA child.
Additional conditions apply to the payment of FTB Part A. From 1 July 2018, where a child does not meet the immunisation or health check requirements (2.1.3), the FTB child rate will be reduced for each day during an FTB rate reduction period (1.1.F.58):
- an individual must meet immunisation requirements for all children aged under 20 years (188.8.131.52), and
- if an individual or their partner receives an income support payment on any day that the individual is also receiving FTB Part A, and they have an FTB child that turns 4 in that income year, an age-appropriate health check must be undertaken for that child (184.108.40.206).
To be eligible for FTB Part B the primary earner must have an ATI at or below the income limit (1.1.I.45). FTB Part B is paid at different rates depending on the age of the youngest child and when the individual is a member of a couple, the income of the secondary earner (1.1.S.25).
An individual is not eligible for FTB Part B if they are a member of a couple and their youngest child is aged 13 years or over, unless the individual is the grandparent or great-grandparent (1.1.G.15).
Act reference: FAAct section 61B Reduction in FTB child rate unless immunisation requirements satisfied, section 61A Reduction in FTB Child rate unless health check requirement satisfied, Schedule 1 clause 28D Member of a couple whose youngest FTB child has turned 13, Schedule 1 clause 30 Standard rate (Part B rate)
Policy reference: FA Guide 3.1 FTB rate calculation, 220.127.116.11 Current FTB rates & income test amounts, 18.104.22.168 Method 1 - calculating the maximum rate of FTB Part A, 22.214.171.124 Rent assistance, 3.1.8 FTB Part A rate calculation - Method 2, 126.96.36.199 FTB immunisation requirements, 188.8.131.52 Healthy Start for School requirements (FTB).
Payment options - how FTB is paid
Individuals have a choice of different ways to receive FTB through Centrelink (184.108.40.206).
They may choose to receive FTB:
Individuals receiving FTB as fortnightly instalments may choose to receive ES as fortnightly or quarterly payments.
ACOs (1.1.A.80) can only receive FTB and ES through Centrelink as a fortnightly payment or as a lump sum.
FTB end of year supplements
The FTB Part A and Part B supplements increase the individual's rate of FTB Part A and Part B but are only paid after the end of the income year following the lodgement of tax returns by an individual and/or their partner, if required to lodge a tax return. Individuals and/or their partners who are not required to lodge a tax return should advise Centrelink in order to receive the FTB supplement.
Additionally, if an individual's ATI (which includes the ATI of their partner if any) is more than $80,000 for the relevant income year, then the individual's FTB Part A supplement in relation to that year will be nil.
Additional conditions may also apply to the payment of the FTB Part A supplement. For income years prior to 2018-19, entitlement to FTB Part A supplement is conditional on immunisation and heath check requirements being met (2.1.3).
Example: Fiona was required to meet the immunisation requirements for the 2016-17 entitlement year, however failed to do so. Therefore, Fiona will not receive her FTB Part A supplement which she otherwise would have been paid during the 2017-18 income year.
Example: Kelsey's child turned 4 during the 2017-18 entitlement year, therefore Kelsey must meet the health check requirements and notify Centrelink of this by the end of the first income year after the entitlement year her child turned 4; that is by 30 June 2019. Kelsey fails to meet the health check requirement on time and therefore will not receive her FTB Part A supplement which she otherwise would have received during the 2018-19 income year.
Note: The supplement may be used to offset any outstanding FTB, CCS or income support payment debts.
Act reference: FA(Admin)Act section 32A FTB Part A supplement and FTB Part B supplement …
Families receiving fortnightly instalments of income-tested FTB Part A (220.127.116.11) at the maximum rate (1.1.M.26) are automatically entitled to a HCC. An individual who has a regular care child may also be eligible for a HCC.
Policy reference: FA Guide 18.104.22.168 Health care card (HCC)
Background to FA payments
The FA (1.1.F.02) arrangements were implemented as part of changes to Australia's taxation system on 1 July 2000. FA payments are administered by Centrelink under FAAct and FA(Admin)Act.
FA payments are aimed specifically at families to:
- increase assistance
- improve work incentives, and
- customise the delivery of assistance.
Twelve types of assistance that were previously available to families were replaced by 3 forms of assistance:
- FTB Part A
- FTB Part B, and
- child care subsidy.
FTB Part A replaced:
- family allowance at the minimum and more than minimum rate
- Family tax payment (FTP) Part A, and
- Family tax assistance (FTA) Part A.
FTB Part B replaced:
- basic PP
- guardian allowance
- FTP Part B
- FTA Part B
- dependent spouse rebate (with children), and
- sole parent rebate.
Payments under the government's new tax package came into effect on 1 July 2000. At that time provisions related to FA were repealed from Social Security Law. Transitional arrangements were put in place for individuals already receiving a family benefit (1.1.F.05) prior to 1 July 2000.
The 2004 Federal Budget provided additional assistance with the introduction of the FTB Part A supplement payable as part of the reconciliation process from 1 July 2004. In 2005, the FTB Part B supplement was introduced for part-year from January 2005, payable from 1 July 2005.
On 1 July 2004, the child care tax rebate (CCTR) was introduced for families and was administered by the ATO. For the 2006-07 income year, and subsequent years, CCTR was removed from the tax system to be delivered as a FA payment through Centrelink.
From 1 July 2009, CCTR was renamed child care rebate (CCR).
In early 2008, the Jobs, Education and Training Child Care Fee Assistance (JETCCFA) was introduced.
In 2011, payment of the FTB Part A supplement for children turning 4 years during the relevant income year was made conditional on the child undergoing a health check.
In 2012, payment of the FTB Part A supplement for children turning 1, 2, and 5 years during the relevant income year was made conditional on the child meeting immunisation requirements.
On 1 July 2013, the clean energy supplement (CES) was introduced as a new component of FTB which was to help eligible households with any impact from the carbon price on everyday expenses.
On 1 March 2014, the baby bonus was abolished and the NBS was introduced as a new component of FTB Part A to help families with the upfront costs of a new child (where the family is not accessing PPL for that child).
From 20 September 2014 the CES was renamed the ES and ceased to be indexed.
On 1 January 2016, immunisation requirements were extended to FTB children who turned 1 in the relevant income year and in each income year after that up to and including 19 years for the payment of the FTB Part A supplement and to children aged under 20 for child care assistance payments. Exemptions based on personal, philosophical and religious objections were also ended.
From 1 July 2016, FTB Part B was removed for couple families (other than grandparents and great-grandparents) with a youngest child aged 13 or over. Single parents, grandparents and great-grandparents caring for a youngest child aged 13 to 18 will continue to have access to FTB Part B (subject to satisfying other relevant requirements).
From 1 July 2016, if an individual's ATI (which includes the ATI of their partner if any) is more than $80,000 for the relevant income year, then the individual's FTB Part A supplement in relation to that year will be nil.
From 20 March 2017, ES ceased for new FTB recipients. For individuals who became new recipients of FTB after 20 September 2016, they will no longer be paid ES after 19 March 2017. However, eligible individuals and ACOs may continue to be paid ES as part of their FTB rate under grandfathering rules. See 8.2.
From 1 July 2018, where a child does not meet the immunisation or health check requirements, the FTB child rate will be reduced for each day during an FTB child rate reduction period.
On 2 July 2018, CCS and ACCS replaced child care benefit and CCR as part of the Government's new child care package. Amongst other things, one component of the ACCS, namely the ACCS (transition to work) replaced JETCCFA.
Policy reference: FA Guide 3.6 Historical rates