6.1.2.50 Reviews - business, sole traders & partnerships

Summary

This topic contains information on reviews resulting from possible changes in circumstances for income support recipients who are operating a business as a sole trader or a partnership, and covers:

  • business and self-employment reviews
  • primary production reviews
  • revaluation of real estate and businesses, and
  • conducting the revaluation review.

Policy reference: SS Guide 6.1.1.10 General Provisions for Income & Assets Reviews, see Variations in income

Business & self-employment reviews

The following table shows the review action required for self-employed income support recipients operating a business as a sole trader or partnership.

If … then their entitlement is reviewed …
an income support recipient is self-employed at least annually, AFTER their tax return and TNA is available.

the business has only recently started, OR

no tax return is available

based on the business records held by the income support recipient, pending the availability of the tax return.

an income support recipient advises that their business has declined by a significant degree during the year, AND

applies for an increase in their payment rate

based on the business records available.

Example: Profit and loss statements, ledger books.

Policy reference: SS Guide 4.7 Business Structures, Primary Production & pre-01/01/2002 Assessment of Trusts & Private Companies

Primary production reviews

Information in this section also applies to reviews of primary producers who are operating as sole traders or partnerships.

Policy reference: SS Guide 4.7 Business Structures, Primary Production & pre-01/01/2002 Assessment of Trusts & Private Companies

Revaluation of real estate & businesses

The value of a person's assets are included when calculating an income support payment entitlement. For social security purposes, the value of an assessable asset is its net market value.

The net market value is the amount the owner could expect to receive if the asset was sold on the open market less any allowable charges or encumbrances. This ensures that people with assets of similar value are treated the same way under the assets test.

A valuation of a person's assets by a licenced valuer may be arranged to determine an accurate asset value.

To maintain the value of real estate assets and payment accuracy, an annual indexation is applied to the assessed value of houses, units and townhouses.

Although an indexation date will display on the record, the following property types are not be subject to indexation: retail, commercial and industrial premises, farms, bush block, home block on greater than 2 hectares and vacant blocks.

To maintain the value of these assets, for individuals and/or partners in receipt of a pension payment, these properties are automatically re-profiled every 2 years on the indexation date to determine if a valuation is required. For non-pension individuals, the current market value of these properties must be considered during general review of circumstances.

An income support recipient may seek a revaluation of real estate or a business at any time.

Policy reference: SS Guide 4.6.5.30 Assessing Property, Real Estate & Unit Trusts, 4.6.7 Asset hardship rules, 6.5 Profiling reviews, 4.6.6.10 General provisions for valuation of assets

Conducting the revaluation review

To conduct the review, a delegate needs to:

  • consider the information supplied under the module R
  • consider whether to request a valuation from a professionally qualified valuer, and (where applicable)
  • request a valuation from a professionally qualified valuer, and
  • obtain any supporting evidence held by the income support recipient and pass this on to the valuers.

Example: Supporting evidence from a real estate agent.

The revised value of the real estate or business asset applies from the date the revised valuation is received.

Last reviewed: 20 March 2020