3.1.11.20 Working Credit Accrual

Introduction

An accrual of working credit is an increase in the working credit balance. This topic covers:

  • who can accrue,
  • circumstances for accrual,
  • accrual amounts, and
  • the accrual calculation.

Who can accrue

A recipient eligible for working credit can accrue working credits; recipients who are NOT eligible for working credit cannot.

Policy reference: SS Guide 3.1.11.10 Recipients Eligible for Working Credit

Circumstances for accrual

A person eligible for working credit will accrue working credits for a day if the person has, for that day, a fortnightly rate of total ordinary income (1.1.O.30) that is less than $48.00. In that case, the amount of working credit accrued for the day is the difference between $48.00 and the fortnightly rate of total ordinary income divided by 14. Working credit cannot accrue if their fortnightly rate of total ordinary income on a day is $48.00 or more.

The impact of a partner's income on the person's working credit accrual depends on whether the couple is an allowance couple or a pensioner couple.

Type of couple Recipient Partner
Both person and partner are receiving an allowance. Working credit accrual is based on recipient's own income. Partner's income has no impact on recipient's working credit accrual.
Person is receiving an allowance, and their partner is not receiving a social security pension or benefit. Working credit accrual is based on recipient's own income. Partner's income has no impact on recipient's working credit accrual.
Both person and partner are below age pension age, and are in receipt of a pension. Working credit accrual is based on half the combined total ordinary income. Half of the partner's total ordinary income is used for the recipient's accrual.
Both are in receipt of a pension, and the partner is over age pension age. Working credit accrual is based on half the combined total ordinary income. Not eligible for working credit.
Both are below age pension age, and one member receives a pension and the other receives an allowance. Working credit accrual is based on half the combined total ordinary income. Half of the partner's total ordinary income is used for the recipient's accrual.
One member is below age pension age and receives a pension, and the other does not receive a social security pension or benefit. Half the combined total ordinary income will count in the accrual calculation. Not eligible for working credit.

Accrual amounts

The maximum fortnightly accrual amount is 48 working credits. The maximum daily accrual amount is 3.4285. The maximum working credit balance for an eligible YA recipient who is not undertaking full-time study and is not an Australian Apprentice is 3,500 working credits. The maximum working credit balance for other recipients eligible for working credits is 1,000 working credits.

Accrual calculation

Working credit accrual occurs on a daily basis just as rates of income support are calculated daily.

Fortnightly accrual amount = $48.00 - fortnightly rate of total ordinary income

Daily accrual amount = ($48.00 - fortnightly rate of total ordinary income for the day)/14

Where the person has a change to their rate of income part way through an instalment period a daily calculation of their working credit accrual is required. For a detailed daily accrual calculation example see (3.1.11.40).

Act reference: SSAct section 1073F Working out accruals and depletions of working credit for social security beneficiaries, section 1073H Working out accruals and depletions of working credit for social security pensioners

Policy reference: SS Guide 3.1.11 Working Credit

Last reviewed: 7 November 2016