9.4.3.20 Examples - income requirements for individuals
Income requirements
The income requirements for both a mandatory AoS (security required) and a discretionary AoS (security not required) are incremented according to the number of assurers, the number of dependent children of the assurer/s and the number of adults to be supported under the AoS. This is to ensure that the assurer/s has sufficient income to support themselves and any dependents as well as the assurees under the AoS.
The assurer/s must meet the applicable income threshold for the current financial year and either the previous financial year (known as the first financial year) or the financial year before that (known as the second financial year).
The first financial year must be used, unless a notice of assessment from the ATO is not available for that year or the assurer’s income for that year is confirmed to have been reduced due to a temporary change of circumstances. In either of these circumstances, the first financial year can be disregarded. The assurer must still meet the income threshold for the current financial year and the second financial year.
Evidence for establishing that a reduction in income for the previous financial year was due to a temporary change in circumstances should be provided to enable the decision maker to make an assessment. This could include but is not limited to: documentation from an employer specifying long-term parental leave, or a letter from a doctor or specialist describing the nature of an illness as temporary.
For an individual AoS where only one person is giving the assurance, only the income of that person is assessed. If the person does not meet the income threshold for providing an AoS in the current year as well as one of the 2 previous years, the option of entering into a joint AoS arrangement is available. In a joint AoS, up to 3 people sign the AoS and are held equally liable for any social security debts that arise as a result of the AoS. In this case, the people giving the AoS are required to demonstrate a combined minimum income for the current financial year and either the first financial year or second financial year.
The income threshold is equal to the maximum annual basic rate for JSP for a single person with dependent children (JSP rate as at the most recent 1 July) for each of the adults involved in the AoS, whether they are an assurer or assuree. That is the JSP rate multiplied by the number of assurers giving the AoS (up to a maximum of 3 assurers) and the number of adults who are being supported under the AoS (up to a maximum of 2 assurees).
Note: On 20 March 2020 JSP replaced NSA. Prior to 20 March 2020 the AoS income test was based on the maximum annual basic rate for NSA for a single person with dependent children.
No increase is required to the income threshold in respect of an assurer's partner if the partner is not part of the AoS. The partner may give an AoS in his or her own right provided they meet the eligibility requirements. In this case, the income threshold for the partner’s AoS is calculated separately.
If an assurer's family includes children under 18 years of age, the income threshold is increased by the annual base rate of FTB Part A plus the rate of FTB Part A supplement (as at the most recent 1 July) for each of the assurer's children. The base FTB Part A rate and the applicable supplement are only added to the income threshold for dependent children of the assurer/s. They do not apply to the children of the assurees.
Note: Children of an assuree over 18 years are considered to be adults and may be required to have a separate AoS. In this case, they are included in the income threshold calculation for their assurer.
Note: From 1 July 2016, if an individual's ATI (which includes the ATI of their partner if any) is more than $80,000 for the relevant income year, then the individual's FTB Part A supplement in relation to that year will be nil.
Examples - calculating the income threshold
The following examples (worked out based on rates as at 1 July 2023) are provided to explain how the income thresholds are calculated and are a guide only.
Example 1: Assurer/s with no children aged under 18 years (worked on the assumption that the applicable JSP rate is $19,428.43 as at July 2023):
- if one person gives an AoS for 2 adults the income threshold will be $58,285.29 (3 multiplied by applicable JSP rate)
- if 2 people give an AoS for 2 adults the income threshold will be $77,713.72 (4 multiplied by applicable JSP rate), or
- if 3 people give an AoS for 2 adults the income threshold will be $97,142.15 (5 multiplied by applicable JSP rate).
Example 2: If a single person with 2 children applies to give an AoS for a migrating family of 2 parents and 2 children, the minimum required income amount of the assurer is the total of:
- $58,285.29 (the applicable rate of $19,428.43 multiplied by the total number of adult assurers and adult assurees (3)), plus
- $5,329.00 (the base FTB Part A rate of $1,784.85 and the applicable supplement amount of $879.65 (that is, $2,664.50) multiplied by the total number of the assurer’s children (2)).
Example 3: If couple with 2 children gives an AoS jointly for a migrating family of 2 parents and 2 children, the combined minimum required income for both assurers is the total of:
- $77,713.72 (the applicable rate of $19,428.43 multiplied by the total number of adult assurers and adult assurees (4)), and
- $5,329.00 (the base FTB Part A rate of $1,784.85 and the applicable supplement amount of $879.65 (that is, $2,664.50) multiplied by the total number of the assurers' children (2)).
Examples – meeting the income threshold
The following examples (worked out based on rates as at 1 July 2023) are provided to explain how the income requirements are assessed and are a guide only.
Example 1: In 2023-24 the income required for each adult involved in the AoS was $19,428.43 per annum (JSP rate as at 1 July).
Pham's income details are as follows: $60,000.00 in 2021-22, $61,000.00 in 2022-23. Her current income for 2023-24 is $62,000.00. Pham wishes to provide an AoS for her mother who has applied for a visa with a mandatory AoS provision. There are 2 adults (one assurer and one assuree) involved in the AoS. Pham meets the income threshold of $38,856.86 for 2023-24 and 2022-23.
Example 2: In 2023-24 the income required for each adult involved in the AoS was $19,428.43 per annum (JSP rate as at 1 July).
Carol's income details are as follows: $24,000.00 in 2021-22, $25,000.00 in 2022-23. Her current income for 2023-24 is $26,000.00. Carol wishes to provide an AoS for her sister, Pamela, who has applied for a visa with a mandatory AoS provision. There are 2 adults (one assurer and one assuree) involved in the AoS. Carol does not meet the income requirement as her income is below the threshold of $38,856.86 per annum.
Her friend, Sarah, agrees to provide a joint AoS. Their income, when combined would total the following amount:
| 2021-22 | 2022-23 | Current income (2023-24) | |
|---|---|---|---|
| Carol | $24,000 | $25,000 | $26,000 |
| Sarah | $40,000 | $43,000 | $42,000 |
| Total | $64,000 | $68,000 | $68,000 |
As there are now 3 adults (2 assurers and one assuree) involved in the AoS, the combined income of Carol and Sarah needs to be at least $58,285.29 per annum for them to be approved as assurers. Carol and Sarah meet the AoS income requirements in 2023-24 and 2022-23.
Example 3: In 2023-24, the income required for each adult involved in the AoS was $19,428.43 per annum (JSP rate as at 1 July).
In some instances, one of the joint assurers may have zero income and no TNA for a particular financial year. However, as long as the total combined amount of income for both assurers is over the required income threshold for that year then the income test requirements are met.
John and Mary wish to become joint assurers for John’s parents who have applied for a visa with a mandatory AoS provision. Their income when combined would total the following amount:
| 2021-22 | 2022-23 | Current income (2023-24) | |
|---|---|---|---|
| John | $45,000 | $80,000 | $67,000 |
| Mary | $45,000 | $0 (No TNA) | $30,000 |
| Total | $90,000 | $80,000 | $97,000 |
As there are 4 adults (2 assurers and 2 assurees) involved in the AoS, the income requirement is $77,713.72 per annum. The combined income of John and Mary for 2022-23 and the current financial year (2023-24) exceeds the required income amount and therefore they meet the AoS income requirements.
Example 4: In 2023-24, the income required:
- for each adult involved in the AoS is $19,428.43 per annum (JSP rate as at 1 July)
- for each of the assurer's children under 18 years of age is $2,664.50 per annum (base rate of FTB Part A plus the rate of FTB Part A supplement as at 1 July).
Jemma, who is single and has one child aged 9 years, wishes to provide an AoS for Jane who has applied for a visa with a discretionary AoS provision. The Department of Home Affairs has decided that an AoS is required in this instance. Jemma's taxable income was $30,000.00 in 2021-22 and $31,000.00 in 2022-23. Her current income is $32,000.00. There are 2 adults (one assurer and one assuree) and one child involved in the AoS. Jemma does not meet the income threshold, which is $41,521.36 per annum.
Her father, Norm, agrees to provide a joint AoS. Their income when combined would total the following amount:
| 2021-22 | 2022-23 | Current income (2023-24) | |
|---|---|---|---|
| Jemma | $30,000 | $30,000 | $30,000 |
| Norm | $20,000 | $20,000 | $20,000 |
| Total | $50,000 | $50,000 | $50,000 |
There are now 3 adults (2 assurers and one assuree) and one child involved in the AoS, Jemma and Norm need to have a combined income of at least $60,949.79 to meet the income requirements. For 2023-24 and 2022-23, their combined income falls below the required income amount. Therefore, Jemma and Norm do not meet the income requirement to give an AoS. They would need to find another person to provide a joint assurance in order to meet the AoS income test requirement.
Example 5: In 2023-24, the income required:
- for each adult involved in the AoS is $19,428.43 per annum (JSP rate as at 1 July)
- for each of the assurer's children under 18 years of age is $2,664.50 per annum (base rate of FTB Part A plus the rate of FTB Part A supplement as at 1 July).
Anton and Mai wish to become joint assurers for their friend Merindah who has applied for a visa with a mandatory AoS provision. Anton has 2 dependent children who are under 18 years of age. Their income would total the following amount:
| 2021-22 | 2022-23 | Current income (2023-24) | |
|---|---|---|---|
| Anton | $35,000 | $43,000 | $45,000 |
| Mai | $25,000 | $30,000 | $35,000 |
| Total | $60,000 | $73,000 | $80,000 |
As there are 3 adults (2 assurers and one assuree) and 2 children involved in the AoS, the income required is $58,285.29 plus $5,329.00 totalling $63,614.29. Anton and Mai jointly meet the AoS income requirements in 2023-24 and 2022-23.
Example 6: In 2023-24, the income required:
- for each adult involved in the AoS is $19,428.43 per annum (JSP rate as at 1 July)
- for each of the assurer's children under 18 years of age is $2,664.50 per annum (base rate of FTB Part A plus the rate of FTB Part A supplement as at 1 July).
George and Jelena wish to become joint assurers for their friend Sofia who has applied for a visa with a mandatory AoS provision. George and Jelena have 2 dependent children who are under 18 years of age – one is an 18-month old baby. Jelena took parental leave for 6 months in the previous financial year and has a letter from her employer confirming this. Their income would total the following amount:
| 2021-22 | 2022-23 | Current income (2023-24) | |
|---|---|---|---|
| George | $40,000 | $43,000 | $45,000 |
| Jelena | $30,000 | $10,000 | $35,000 |
| Total | $70,000 | $53,000 | $80,000 |
As there are 3 adults (2 assurers and one assuree) and 2 children involved in the AoS, the income required in the current and previous financial years is $58,285.29 plus $5,329.00 totalling $63,614.29. George and Jelena jointly meet the AoS income requirements in 2023-24 and 2021-22. The income requirement in the 2022-23 can be disregarded as Jelena can prove her income was reduced temporarily due to her taking parental leave.
Example 7: In 2023-24 the income required for each adult involved in the AoS was $19,428.43 per annum (JSP rate as at 1 July).
Muhammad’s income details are as follows: $80,000.00 in 2021-22, $85,000.00 in 2022-23. He has a notice of assessment from the ATO for 2021-22 but has not yet lodged his tax return for 2022-23 and therefore does not yet have a notice of assessment to confirm his income details for 2022-23. His current income for 2023-24 is $87,000.00. Muhammad wishes to provide an AoS for his parents who have applied for a visa with a mandatory AoS provision. There are 3 adults (one assurer and 2 assurees) involved in the AoS. As Muhmmad does not yet have a notice of assessment for 2022-23, the financial years used when assessing the income requirement are 2023-24 and 2021-22. Muhammad meets the income threshold of $58,285.29 for each of those financial years.
Act reference: SSAct section 1061ZZGH Determinations
Social Security (Assurances of Support) Determination 2018
Policy reference: SS Guide 9.4.3.10 Assurer eligibility requirements – individuals