As all parents know, raising children comes with many costs, which is why it’s good to know that the government has a scheme called the Family Tax Benefit in place to help parents cover some of these costs, and it’s important to understand what you might be entitled to and how to claim it.
Although the total benefit will vary according to each family’s circumstances, this article will give a brief rundown on what Family Tax Benefit is, Family Tax Benefit Payment rates, some of the tests used to determine your payments and the process involved with making a claim. Family Tax Benefit is broken into Family Tax Benefit part A and B, and is a separate process for getting your child registered with Centrelink and claiming child care subsidy.
Family Tax Benefit Part A
This portion of FTB is calculated per child and according to each individual family’s circumstances. The eligibility requirement is that you must care for a dependent child aged 0-15 years at least 35% of the time, or a child aged 16-19 years who meets specific study requirements. You will undergo income testing to determine the amount of support you receive, but it is only eligible for families whose total adjusted taxable income is less than $80,000 per year.
To receive the full payment, your child must be fully vaccinated according to the government schedule, and comply with Healthy Start for School requirements. Waiting periods will differ, but if you are a new resident in Australia, you will need to wait a full year to receive FTB A.
FTB part A Supplement is a yearly payment that is calculated according to income, number of children, percentage of care of child, and days during the financial year you were eligible for FTB A. The FTB A supplement payment varies but was up to $781.10 per eligible child in the financial year 2020-2021.
Family Tax Benefit B
You can receive this portion of the FTB if you are in a couple with one main income and a dependent child under the age of 13, or if you are a single parent or non-parent carer, or grandparent of a dependent child under 18. In all of these cases, you must have at least 35% care of the child. To learn more about grandparents caring for children, and the options available read this.
How much is family tax benefit will I receive?
The payment you receive for FTB A and B will be determined by your adjusted taxable income, FTB income testing and the age and number of children in your care. If you share care responsibilities for your child, the FTB payment rates will be calculated on the percentage of care you hold.
The base rate of FTB A supplement is $60.90 per child, per fortnight (but this doesn’t mean the minimum rate, as it can be lower depending on your income) and the maximum threshold rate depends on the age of the child: $189.56 for children 0-12 years old, and $246.54 for children 13-19 years old (they must meet the study requirements from 16-19 years old).
If you’re a single parent or non-parent carer, you can claim the maximum rate of FTB B if you earn $100,000 or less per year, until the end of the calendar year when your youngest child turns 18.
If you’re a partnered parent or partnered carer, you are eligible for FTB B until your youngest child turns 13, if the primary earner (the partner who earns the most per year) earns less than $100,000 per year, and the, secondary earner earns less than $28,671 per year before the child turns 5, and $22,338 per year while the youngest child is 5-13 years old. The secondary earner can earn up to $5,767 per year before it begins to impact the overall FTB B, which reduces according to the amount earned.
The maximum rate per family for Family Tax Benefit B is $161.41 per fortnight when your youngest child is aged 0-5 years old, and $112.56 when your youngest child is 5-18 years of age. It’s important to know that you aren’t eligible for this payment when receiving Parental Leave Pay.
Claiming Family Tax Benefit
Family Tax Benefit is paid through Centrelink, so you will need to either lodge a claim to Centrelink online via your myGov account or attend a Centrelink service centre and use a form to apply, with assistance from a service assistant if necessary.
It’s important to consider how you would like to receive your payments, to make sure that you don’t get underpaid or overpaid and have to pay Centrelink back. You can either claim FTB in fortnightly instalments at the full or adjusted rates, or as a lump sum at the end of the financial year. Just remember that if you opt to receive a lump sum after the end of the financial year, you must submit your claim before 30 June of the next financial year.
Tip: keep your estimated family income up-to-date on your myGov account so that you get paid correctly.
To claim FTB A you can choose the following payment options:
1. All of your entitled amount fortnightly – best if you can give an accurate estimate of your yearly income
2. Base rate of FTB A, and receive any remaining pay you’re entitled to in a lump sum after the end of the financial year
3. Lump sum after the end of the financial year – this option is best if your income is such that you don’t rely on your FTB (but still under the income limit), and you can’t accurately estimate your income in a year.
To claim FTB B you can choose the following payment options:
1. All of your FTB fortnightly
2. All of your FTB after the end of the financial year
While Centrelink can’t estimate how long your Family Tax Benefit claim processing time will be, they should receive your information 28 days after the Australian Tax Office sends you a Notice of Assessment, so it’s worth getting your tax return completed as soon as possible. If you have been overpaid and need to pay Centrelink back, you can set up a payment plan via their Families Line.
As most families will be eligible for some portion of the Family Tax Benefit scheme, it’s worth ensuring your family information is up-to-date and you’re receiving the correct payments to help cover the costs of raising your family.
You can calculate the child care subsidy you're eligible for with Toddle's child care subsidy calculator here.
While you’re looking into FTB, check out the Child Care Subsidy scheme and find one of Australia’s approved child care centres through toddle.com.au, the most comprehensive child care search database in Australia.
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