6.4.4.10 Reconciliation - current partners

Summary

This topic discusses the treatment of current partners (1.1.P.30) in the reconciliation process. It details:

the impact of a current partner on the timing of reconciliation
the impact of one partner not lodging an income tax return, and
the assessment of ATI (1.1.A.20) for periods when the individual (1.1.I.90) was partnered.

A current partner for the purposes of reconciliation is a person with whom the individual was partnered for part of, or for the entire claim period, during the relevant income year (1.1.R.23) and with whom they were still partnered on 30 June of that year (or for CCS, still partnered on the last day of the CCS year).

Impact of a current partner on the timing of reconciliation

For FTB and CCS, if both the individual and their current/relevant partner/s are not required to lodge a tax return for an income year, reconciliation can occur immediately following the end of the relevant income year provided all the other conditions for reconciliation are met. For reconciliation to occur in these circumstances, the individual must notify Centrelink of their combined ATI.

If the individual and/or their current partner are required to lodge an income tax return for the relevant income year, reconciliation can only occur after their income tax return/s have been lodged and all the other conditions for reconciliation are met.

Example: Rachel is receiving FTB and CCS and is partnered to Steve throughout the relevant income year. Both are required to lodge income tax returns. Steve lodges an income tax return for the relevant income year by 1 October of the lodgement year, and actual maintenance income and child-care usage are available at that time. Rachel has not yet lodged an income tax return. No reconciliation of Rachel's FTB and/or CCS entitlement can be carried out until Rachel lodges an income tax return for the relevant income year.

Policy reference: FA Guide 6.4.1.30 Reconciliation process, 6.4.3.10 Valid reasons for not lodging a tax return

FTB reconciliation conditions not met by March/April of lodgement year

An individual will be subject to the FTB non-lodger (1.1.N.33) notice process if they and/or their partner have not lodged an income tax return for the relevant income year, or notified Centrelink of their combined ATI if they and/or their partner are not required to lodge an income tax return for the relevant income year, by March/April of the lodgement year (1.1.L.30).

Policy reference: FA Guide 6.4.3 Requirement to lodge an income tax return

CCS reconciliation conditions not met

An individual fails to meet the reconciliation conditions by not lodging a tax return or, where they are not required to lodge a tax return, by not notifying Centrelink of their ATI. These obligations also apply to any partner of a claimant during that income year.

The first deadline by which reconciliation conditions must be met is one year after the end of the income year in which CCS entitlement (1.1.E.30) was determined - that is, by 30 June of the first income year after the relevant income year. If reconciliation conditions have not been met by the first deadline, a determination of no entitlement (that is, no CCS payments) will be made until the individual meets the reconciliation conditions.

If an individual meets the reconciliation conditions after the first deadline but before the second deadline, their CCS entitlement will resume from the week in which reconciliation conditions were met.

The second deadline is 2 years after the end of the income year in which CCS entitlement was determined. If reconciliation conditions have not been met by the second deadline, the family’s CCS eligibility is cancelled, and debt recovery will commence for the subsidy that was paid in relation to the CCS year (that is, all CCS fortnights (1.1.C.10) that start in the income year).

Loss of eligibility for CCS will also result in a loss of eligibility for ACCS, if applicable. In order to regain eligibility and entitlement to CCS and/or ACCS, the individual will need to ensure they meet reconciliation conditions for all income years in which CCS entitlement was determined, before they will be able to make a new effective claim for CCS.

Example: Jo received CCS in the 2018-19 income year. She was partnered with Tom for the whole income year. Jo lodges a return by 1 October 2019, Tom lodges a tax return in April 2020. Jo's entitlements can now be reconciled and she continues to receive CCS.

Example: Trish received CCS in the 2018-19 income year. She was partnered with Clive for the whole income year. Trish and Clive fail to lodge tax returns for 2018-19 by July 2020 (the first deadline). Trish loses her entitlement to CCS, so no CCS payments are made to her approved provider on her behalf from 1 July 2020 onwards. Trish and Clive lodge their tax returns on 23 July 2020. Trish starts receiving CCS entitlement from the week in which she met the reconciliation conditions and is not entitled to any subsidy for the period 1 to 22 July 2020.

Assessment of ATI

For individuals with a current partner or an ex-partner, assessment of their FA entitlement is carried out by including:

only the individual's ATI for any period they were single, and
both the individual's and partner's ATI for any period they were a member of a couple (1.1.M.50).

Example: Gayle receives FTB for the whole of the last income year. She is partnered to Gordon for the period 1 July to 30 September, single for the period 1 October to 31 December, and partnered to Brian for the period 1 January to 30 June. Gayle's actual ATI for this year is $10,000, Gordon's income is $20,000 and Brian's income is $8,000. The ATI for Gayle's FTB for each period is as follows.

Period	FTB Part A	FTB Part B	Child care subsidy
01/07 to 30/09	$30,000	$10,000	$30,000
01/10 to 31/12	$10,000	No income test	$10,000
01/01 to 30/06	$18,000	$8,000 (see note)	$18,000

Note: FTB Part B is generally assessed on the secondary earner's income for members of a couple. However, an income limit (1.1.I.45) is applicable to the primary income earner in a couple family, and to individuals who are single.