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. Determining the rate of SpB

How is the rate of SpB determined?

The following table explains the steps in determining the rate of SpB payable:

Step Description
1 Calculate the rate of JSP, YA or Austudy the person would otherwise receive.
2 Apply the direct deduction income test.
3 Deduct an amount for any in kind support the person receives on a continuing and indefinite basis.

Policy reference: SS Guide 4.2.2 Benefits income test & limits

Maximum rate

While the rate of SpB payable is discretionary, it CANNOT exceed the rate of JSP, YA or Austudy that the person would otherwise receive.

Parental income test

When the person is living with his/her parents, the rate of SpB payable is subjected to the parental means test (as per YA).

The person would only receive the full rate of SpB if, for example, the parents were receiving a pension, benefit or allowance or their income was below the threshold applicable. If, after applying the parental means test the rate of YA applicable would be nil, SpB is not payable.

Act reference: SSAct section 746 Rate of special benefit

Policy reference: SS Guide JSP - current rates, YA - current rates, Austudy - current rates

Direct deduction income test

A direct deduction income test applies to SpB. This means that all personal income, whether earned or unearned, reduces the SpB rate by that amount. There is no allowable income free area and no graduated taper. The income test for SpB is explained further in Part 4 of the SS Guide.

Note: Other departmental benefits, e.g. FTB, are not regarded as income under the SpB direct deduction income test.

Policy reference: SS Guide Supplementary benefits & assistance for SpB recipients

Partner (1.1.P.85) not qualified for pension, benefit or allowance

If the SpB recipient's partner does not receive a pension, benefit or allowance, the partner income free area is the amount of income that would preclude payment of JSP to the partner if the partner were qualified. That is, the cut-off point of the basic applicable JSP rate. Any income the partner earns over this partner income free area is directly deducted from the recipient's rate of SpB.

Policy reference: SS Guide 4.2.6 SpB income test & limits, Income from scholarships

Regular in kind support

If the person receives in kind support on a regular basis, the amount of the support is deducted from the rate payable AFTER the income test is applied. In kind support includes:

  • payments of bills
  • spousal maintenance
  • provision of food, clothing and/or pharmaceutical items, and
  • free board and/or lodging.

Note: No deductions for regular in kind support are applied to people who hold a Temporary Humanitarian Stay (subclass 449) visa that was granted on or after 19 August 2021 due directly or indirectly to the deteriorating security situation in Afghanistan.

Free board &/or lodging

Where free board and/or lodging is provided, an amount should be deducted from the rate as follows:

  • two-thirds of the rate of SpB payable if both board and lodging are provided, or
  • one-third of the rate of SpB payable if only lodging is provided.

Temporary board & lodging

If the free board and/or lodging is provided on a temporary basis only, there should be NO deduction. This includes where board and/or lodging is provided pending determination of the claim for SpB. The delegate should ensure that the free board and lodging is in fact only temporary. As a guide, free board and lodging is regarded as temporary if it is provided for no more than 6 weeks.

Delegate discretion

The rate to be deducted for in kind support and free board and/or lodging is discretionary and the advice given above is to be used as a guide only. To determine the amount payable, delegates must remember that SpB is a discretionary payment and the amount of money paid is also discretionary.

Policy reference: SS Guide 1.1.B.70 Board & lodging (RA, SpB)

Income waivers for scholarships

From 11 May 2004, all non-discretionary fee-waiver and fee-pay scholarships are not counted as income for social security purposes.

A fee-waiver scholarship is one where an educational institution reduces or waives part or all of the course charge or fee. A fee-pay scholarship is one provided by other organisations to pay for tuition fees. Non-discretionary scholarships are scholarships that do not provide any choice to students over how the scholarship can be used. The scholarship must be for the purpose of waiving or paying a course fee or charge.

Policy reference: SS Guide Income from scholarships

Treatment of board & lodging provided through scholarships

Where students on a scholarship receive regular in kind support, including free board and lodging, the value of the in kind support should be deducted from the rate of SpB payable after the income test has been applied. This means that in the case of a scholarship that includes board and lodging, although the scholarship is not counted when applying the means test, the rate of SpB should still be reduced by two-thirds. This applies to ALL non-discretionary fee-waiver and fee-pay scholarships.

Last reviewed: