Finalised 'no debt' (FND) or 'zeroing' debts that are not legally recoverable 107-05110010

A debt is only legally recoverable if it meets one of the creation provisions from:

• the Social Security Act 1991
• the Family Assistance (Administration) Act 1999, or
• another Act administered by Services Australia

The debt creation provisions work together with:

• the notification rules, and
• wording of the legislation in the qualification and payment provisions

Due to the way the notification rules work, there are cases where there is:

• no basis for raising a debt. For example, the agency cannot expect customers to advise of an event that might affect their payment, if they have not been told they need to. No legally recoverable debt may exist, even though an excess payment has occurred
• a legally recoverable debt. For example, a customer reports a change on their reporting day. This results in a rate reduction. The payment releases before the change is actioned. An excess payment occurs, and a legally recoverable debt exists
• no legally recoverable debt. For example, the legislation may say to pay the customer at a certain rate. A parental income estimate was lower than the actual income. The customer gets more than their entitlement. There is no legally recoverable debt because the payment was calculated correctly at the time

Finalise these cases 'no debt' (FND).

Determining a debt as FND is different from waiving a debt:

• an FND determination means that there was no debt, or that the excess payment is not legally recoverable
• waiving a debt means that although there is a legally recoverable debt, Services Australia will not recover that debt

In instances where the debt status is Determined (DET) and interest has been charged, the system will not include any interest where a determination has been made to finalised the debt as 'no debt' (FND).

See Transfers and refunds.

A customer may receive an excess or incorrect payment but because of legislation or policy, it cannot be raised as a recoverable debt. This includes, excess payments of:

• Pension Bonus Scheme (PBS)
• Incentive Allowance
• Special Benefit (SpB) payments made to minors, where there is no correspondence nominee
• Crisis Payments (CrP) that are not due to the customer falsely claiming or that are not paid under an Assurance of Support (AoS)
• Youth Allowance (YA) where payment is made based upon a parental income estimate
• ABSTUDY where payments are cancelled due to system restrictions

An overpayment may be due to a system or administrative error. In these cases, deciding if a legal debt exists is separate to considering waiver provisions.