4.3.3.80 Income from New Enterprise Incentive Scheme (NEIS)

Rate of NEIS

The rate of NEIS allowance is equivalent to the basic single rate of NSA. The same rate of NEIS allowance is payable to a person regardless of whether the person is single or partnered.

Act reference: SSAct Part 3.15 New Enterprise Incentive Scheme

Rate of reduction where a person is eligible for NEIS & a social security payment

Where a person is eligible for both a NEIS allowance and an instalment of a social security payment listed under SSAct sections 1187(1) or 1187(1A) during a pension period, the social security payment will be reduced by the amount of NEIS allowance.

The amount of rate reduction is to be equal to the amount of the NEIS allowance (section 8(8)(t) and section 1188(1)). This means the deduction is on a dollar for dollar basis. In practice, when a participant converts to NEIS allowance their social security payment will usually cease from this date.

Act reference: SSAct section 8(8) Excluded amounts - general, section 1187 Reduction in rate of payments…, section 1188 Rate reduction under this Part

Effect of NEIS when partnered

Partner's rate of WP or CP may be affected:

  • In the case of a partnered person who is eligible for both a NEIS allowance and an instalment of DSP, or MAA under Part 2.12A and the person's partner is eligible for payment of a WP or CP (in respect of the person receiving NEIS), the income support payments (of both the person and their partner) are reduced by 50% of the amount of the NEIS allowance each fortnight.

Partner not in receipt of WP or CP:

  • Where a partner of a NEIS recipient receives a payment other than WP or CP (in respect of the NEIS recipient), the NEIS payment does not affect their payment rate (section 1187(2) and 8(8)(t)).

Act reference: SSAct section 8(8) Excluded amounts - general, section 1187 Reduction in rate of payments…, section 1188 Rate reduction under this Part, Part 2.12A Mature age (pre-1 July 1996) allowances

Income test treatment of business income

Income from the NEIS participant's business for social security purposes is the gross income with allowable deductions.

Act reference: SSAct section 1075 Permissible reductions of business income

Policy reference: SS Guide 4.7.1.30 Assessment of business deductions & losses for sole traders & partnerships

Last reviewed: 3 January 2017