Raising social security debts due to self-employment or business income 043-03130130
Expand allThis procedure outlines how to assess if a recoverable debt exists where a customer has an increase in business income (either estimated or actual) which decreases the rate of their social security payment. This includes when a customer commences self-employment.
Business income
For self-employed customers, actual business income is assessed from completed tax returns. Australian Taxation Office (ATO) regulations require all businesses to lodge a tax return for any year they operate.
To calculate the ongoing social security payment, the best available estimate of the self-employment income is used. This estimate is based on the most recent completed tax returns, however can also be based on an interim Profit and Loss Statement (SU580).
When a business first commences, and the customers' notification obligations have not been met, a profit and loss statement is acceptable evidence to raise a self-employment debt.
If the customer refuses to give actual income details their social security payment should be cancelled under section 80 of the Social Security (Administration) Act.
The Resources page contains scenarios of debt calculations for customers with income from self-employment.
Related links
General debt raising information
Income for an independent contractor and commission income
Steps to assess an interim profit and loss statement
Changes to income and assets from a business structure
Calculating Centrelink entitlements when investigating debts
Assessment of income and assets from business structures for Centrelink payments