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. Legally irrecoverable debts


This topic provides information about the circumstances in which a debt (1.1.D.60) may not be recoverable at law. A debt that is not recoverable at law may be written-off.

Legally irrecoverable debt

An FA debt is irrecoverable at law if:

  • the debt is unlikely to be recovered as a result of legal proceedings
  • the debtor is discharged from bankruptcy, and the debt was incurred before the discharge but not as a result of fraud, or
  • a debtor has died leaving no estate or there are insufficient funds in the debtor's estate to repay the debt.

Act reference: FA(Admin)Act section 95(3) Secretary may write off debt, section 88 Legal proceedings

SSAct section 1231 Deductions from debtor's pension, benefit or allowance

Policy reference: FA Guide 7.3.1 Writing-off a debt, 7.2.1 Debt recovery - general provisions

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