Reconciliation of Family Tax Benefit (FTB) 007-11010000

Date

Topic & reconciliation

2 July 2024 (after 6pm)

FTB reconciliation begins

Reconciliation period begins for FTB for previous financial year (2023-24).

2-15 July 2024

Automatic Reconciliation for FTB occurs

Reconciliation will be attempted on the customer's Entitlement Period End Date (EPED) + 1 day and if all information is available, it will complete. If they are entitled to receive a top-up, they will generally receive this up to 2 working days after their regular payday.

5 August 2024

CCS reconciliation begins

Reconciliation of Child Care Subsidy (CCS) commences.

July 2024

FTB partial reconciliation for previous partners

FTB reconciliation occurs for customers who separated from their partner during the 2023-24 financial year where only the previous partner income is still required.

August 2024

Non-lodger debts raised

FTB non-lodger debts raised for non-lodgers for 2022-23 financial year.

October 2024

Peak of FTB/CCS reconciliation enquiries

Peak of FTB/CCS reconciliation enquiries as tax returns for 2023-24 must be lodged by 31 October 2024 for most customers.

March 2025

Non-lodger reminder mail out

Non-lodger reminder mail out to ask customers who have not lodged tax returns or advised they are not required to lodge for 2023-24 to confirm income so their FTB can be reconciled.

April 2025

Small peak in reconciliation

Customers using Tax Agents and Accountants usually lodging by end of April can create a small peak in reconciliation.

May 2025

Electronic Message reminder

An electronic message reminder will be sent to customers who still have not lodged their tax returns for the 2023-24 financial year or advised they are not required to lodge.

June 2025

Final Electronic Message reminder

A final electronic message reminder will be sent to customers if family income lodgement requirements are still not met for the 2023-24 financial year.

July 2025

Interim reconciliation for previous partners

FTB reconciliation occurs for customers who separated from their partner after the end of the 2023-24 financial year where only the previous partner income is still required.

30 June 2025

CCS Reconciliation first Deadline

The first deadline is one year after the end of the relevant income year (midnight 30 June or if this falls on a weekend, midnight of the first business day after) unless a special circumstance extension has been granted.

For 2023-24 the first deadline will occur on 30 June 2025.

30 June 2026

CCS Reconciliation second Deadline

The second deadline is 2 years after the end of the relevant income year (midnight 30 June or if this falls on a weekend, midnight of the first business day after) unless a special circumstance extension has been granted. In some circumstances a customer can have this second deadline extension extended indefinitely.

For 2023-24 the second deadline will occur on 30 June 2026.

Item

Description

1

Examples of FTB reconciliation

Actual income details received.

Lauren's estimated taxable income is $67,000. Lauren's partner Carlos' estimated taxable income is $42,000 and $3,200 reportable fringe benefits.

The Australian Taxation Office (ATO) sends actual adjusted taxable income (AATI) details of:

• Lauren $45,000
• Carlos $28,500
• No fringe benefit amounts were received from the ATO for either

Reconciliation will take place on the comparison between the FTB Lauren was paid during the financial year based on their combined estimated ATI of $112,200 and their correct FTB entitlement based on their combined AATI as advised by the ATO of $73,500.

The following are included in the FTB reconciliation calculation (if eligible):

• Family Tax Benefit (FTB) Part A and Part B supplements
• Single Income Family Supplement (SIFS) (only included from 2017-18 if the customer meets the grandfathering provisions)

2

Customer not required to lodge an income tax return

Belinda was paid FTB Part A and FTB Part B by instalments.

Belinda's FTB was paid using an estimated income of $11,000 (taxable income) for herself and partner Rodney had an estimated income of $31,500 (taxable income). Belinda advises of not being required to lodge a tax return.

During the process of advising non-lodgement, the system detects Single Touch Payroll (STP) income for Belinda and displays a wage/salary amount from employment of $12,500. Belinda is confident the amount displayed is correct and chooses to advise her taxable income from employment as $12,500 as part of her advice of non-lodgement.

The system also detects and pre-fill’s an amount of $2,000 for taxable income from Australian Government payment’s which Belinda knows to be her Parenting Payment.

As Belinda's income is less than the tax-free threshold and Belinda had no tax withheld, a non-lodgement exemption is recorded, FTB reconciliation can occur as soon as Rodney's actual income is confirmed by the ATO.

At reconciliation:

• Rodney's actual income transferred by the ATO is $33,000
• Belinda received $2,000 Parenting Payment Partnered (PPP) in the relevant financial year, in addition to the $12,500 taxable income from employment
• Reconciliation of FTB occurs using Belinda's taxable income of $12,500 plus the PPP of $2,000 and Rodney's actual income of $33,000. Combined actual adjusted taxable income of $47,500 is used to work out Belinda's correct FTB rate
• The period Belinda was entitled to PPP would be exempt from the income test for FTB Part A. However, FTB Part B for the same period is income tested using the lower earner's income

3

Adjusted taxable income above the Part A supplement income limit received after automatic reconciliation (from 1 July 2016)

Laura is a single income support customer (Parenting Payment Single (PPS)) for the entire 2023-2024 financial year and was paid FTB Part A and FTB Part B by instalments for 2 children.

Laura did not have any periods where she was subjected to employment nil rate period.

As the payments received during the financial year are not subject to income reconciliation, FTB reconciliation will occur automatically as soon as Laura has been paid her final instalment for the financial year. This is referred to as ‘Automatic’ or ‘bulk’ FTB Reconciliation.

At reconciliation

• Laura’s entitlement is reconciled on the basis that the FTB Part A and FTB Part B are not subject to income reconciliation, and as
• Laura's adjusted taxable income (ATI) is a most recent estimate (MRE) of $34,000, the FTB A and FTB B supplements are paid

At re-reconciliation

During the 2023-24 financial year Laura had received a superannuation payment under the early release process. While this payment does not directly impact their PPS, it will count towards adjusted taxable income for the assessment of the Part A supplement.

As a result of super withdrawal Laura is required to lodge an income tax return for the 2019-2020 financial year, and does so after receiving the supplement payment in Automatic FTB reconciliation.

• Advice of Laura’s 2023-2024 adjusted taxable income is received from the ATO, and is $85,000
• Laura’s FTB entitlement is re-reconciled, and Laura is no longer entitled to the Part A supplement as the adjusted taxable income is above the supplement income limit
• An account payable is sent to Laura for the FTB A supplement amount paid

4

Break in entitlement to Single Income Family Supplement (SIFS) on or after 1 July 2017

Sally is grandfathered for SIFS and receives FTB by fortnightly instalments. Sally goes overseas from 2 August 2018 to 4 October 2018 (a period of 9 weeks).

Sally is paid SIFS for a period of 6 weeks until 12 September 2018. From 13 September 2018 Sally is no longer eligible for SIFS as they have been overseas for longer than the 6 weeks allowable time and will lose their SIFS grandfathering status.

Sally will not be able to receive SIFS again for any period on or after 13 September 2018.

5

FTB immunisation grace period at FTB reconciliation (on or after 1 July 2018)

During the 2020-21 financial year, Eric received FTB fortnightly. Eric has one child, Giovanni.

On 1 October 2020, the Australian Immunisation Register (AIR) sends through an immunisation status update as Giovanni no longer meets immunisation requirements.

FTB immunisation grace period:

• start date: 2 October 2020
• end date: 3 December 2020

During this grace period, an FTB rate reduction due to immunisation is not applied to the rate of FTB for Giovanni.

On 4 December 2020 Giovanni’s immunisation status is checked. An FTB rate reduction due to immunisation starts on 4 December 2020.

At reconciliation, the rate reduction due to immunisation is applied to the rate of FTB Part A for Giovanni for the period 2 October to 3 December 2020.

Historical information

Description

Deadline for FTB for 2011-2012 and earlier years

For customers to receive their full annual FTB entitlement, income lodgement requirements must be met by the end of the extended lodgement year.

Forced reconciliation

From 2015-16 financial year onwards, forced reconciliation no longer applies. Reconciliation will not occur until the customer and their partner confirm their income for the relevant financial year.

For financial years 2014-15 and earlier, forced reconciliation may have been done on some records.

Forced reconciliation was the process where the system attempted to reconcile some records that were held pending. It occurred from mid-November of the lodgement year.

Low Income Review

The customer (or their partner) had an estimated income below $6,000 and was neither a Liable Parent nor a Recipient Parent under a child support assessment.

Child Deferral

Before 1 May 2014, if the customer deferred payment of FTB for any child until after the end of the relevant year, and did not advise whether the child's income had exceeded the child income limit, reconciliation excluded the deferred child.

From 13 June 2015, no new instances of child deferral could be coded. From 1 July 2015, customers with the child deferral payment choice in place had the choice ignored.

From the 2014-15 financial year, deferred children were automatically included in the reconciliation result as child income requirements no longer applied.

If the customer did not advise whether income is above or below the limit:

• forced reconciliation occurred in November following the relevant financial year if other requirement information was available but the customer had not confirmed the child's income
• the deferred child was excluded as an FTB child:
• for the whole year if they were 16 years of age at the start of the financial year, or
• if they turned 16 years of age during the year, from the date they turned 16 or the date they ceased to be a full-time student per details on CHSI screen, whichever is earlier

300 day Income Support

The customer (or their partner) received income support payments for more than 300 days in the financial year, and the:

• customer did not receive any FTB Part B while partnered during the year, and

Child Disability Allowance (CDA)/Double Orphan Pension (DOP) saved FTB rate

The customer has been paid a CDA or DOP saved rate of FTB for the whole financial year and they did not receive any FTB Part B while partnered during the year.

First Home Super Save (FHSS)

Note: from 1 July 2019, the taxable income or loss amount reported by the ATO to Services Australia will exclude any assessable First Home Super Saver (FHSS) Scheme amount from the data transfer. These amounts are disregarded when calculating a customer’s income for family assistance purposes.

Schoolkids Bonus assessments

Schoolkids Bonus ceased from 31 December 2016. It was last payable for the 30 June 2016 bonus test day.

The notification period to update child education details for FTB customers to receive the 1 January 2016 and 30 June 2016 Schoolkids Bonus instalments ended on 30 June 2017.

However, Schoolkids Bonus assessments may still result from FTB reconciliation for the 2012-13 through to 2015-16 financial years.

Debt Deferral

Before August 2022, customers residing in locations affected by disaster events may have their FTB reconciliation remain pending ‘debt deferral’ where the outcome was a debt.

ATO role in reconciliation

Since 1 July 2009, the ATO no longer delivers FTB reconciliation or lump sum claim payment to the customer or advises FTB entitlement details in the Notice of Assessment (NOA) issued to advise the tax assessment.

Customers who received FTB as tax withholdings

This option ceased from 1 July 2008.

During the relevant financial year, they or their partner may have reduced tax withholdings from their wages in anticipation of FTB entitlement.

They were required to lodge an FTB lump sum claim after the end of the financial year, within the allowed time.

The Part A and Part B supplements were included when working out the lump sum claim entitlement as they were not included in the reduced tax withholding rate during the year.

The value of the tax withholdings is not taken into account in working out what was paid for the previous year and does not affect the adjustment of FTB at reconciliation. However, the ATO takes into account the amount of tax withholdings to work out a tax refund or tax debt.

Large Family Supplement (LFS)

LFS ceased to be payable from 1 July 2016. In the 2015-16 financial year, LFS was payable only to families with 4 or more children

Healthy start for school check

For 2011-12 to 2017-18 financial years, recipients with a child who turned 4 years of age during the year are also affected by Healthy Start School requirements when assessing eligibility for the FTB Part A supplement.

Check the FTB Child Eligibility Details (FCED) screen.

This screen shows whether a child is subject to HSFS, health check completed details, parent or non-parent rules applied, and exemption reason (if applicable).

Lump Sum claims FTB for 2011/2012 and earlier

Lump sum claims must be lodged and income confirmed by the end of the extended lodgement year.

Claims could be granted using actual income details for the customer and estimated income for the partner. If the partner's actual income details were later received, lump sum claim entitlement was recalculated. If their current partner was expected to lodge a tax return and actual income details had not been received from the ATO by November of the extended lodgement year (for example, by November 2011 for 2009-10), a non-lodger debt was automatically calculated for the total FTB paid for the relevant financial year.

FTB Part A supplement not payable due to immunisation requirements not being met (from 2012-13 to 2017-18 financial year)

Check the FTB Child Eligibility Details (FCED) and Child Immunisation Summary Guided Procedure. These screens show whether:

• a child is subject to immunisation requirements
• immunisation requirements have been met
• parent or non-parent rules were applied, and
• Centrelink immunisation override applied

2015-16 financial year, 2 different sets of immunisation rules will be applied when calculating the FTB Part A supplement. For an example, see FTB Part A and Part B supplements.

From 1 July 2018, immunisation requirements are linked to FTB Part A. An FTB Part A rate reduction due to immunisation is applied if a child does not meet immunisation requirements.