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Income Test for single allowance customers 108-01020010

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This document outlines the application of the income test for single allowance customers.

Applying the income test for allowance customers

Step

Action

1

Is the customer a full-time student or Australian Apprentice/trainee? + Read more ...

2

Is the customer receiving employment income? + Read more ...

3

Working Credits + Read more ...

Check the WC Balance Summary (WCBS) screen to see if the customer has accrued a Working Credit balance. If there is a number greater than zero in the Balance field, calculate Working Credits to determine the adjusted total ordinary income to be used in the rate calculation. For more information, see Working Credit.

4

Determine fortnightly income + Read more ...

Determine the customer's fortnightly total ordinary income before tax:

  • If the ordinary income is less than $150 a fortnight, there is no effect. Go to Step 7
  • For principal carers receiving JobSeeker Payment (JSP), their payment reduces by 40 cents for each $1 of ordinary income above $150. Go to Step 7
  • For other customers:
    • If the ordinary income is between $150 and $256 a fortnight, or between $150 and $250 a fortnight for YA (Job seeker) customers, go to Step 5
    • If the total ordinary income is above $250/$256, go to Step 6

5

Calculating income reduction amount above $150 + Read more ...

The customer's payment will be reduced by 50 cents for each dollar of ordinary income above $150 a fortnight.

Income reduction amount = (ordinary income for the fortnight - $150)/2.

For example, if the ordinary income earned was $182, the income reduction amount would be ($182 - $150)/2 = $16.

Go to Step 7.

6

Income above $256/$250 + Read more ...

The customer's payment will be reduced by:

  • 50 cents for each dollar of ordinary income between $150 and $256, or between $150 and $250 for YA (Job seeker), and
  • then 60 cents for each dollar of income above $256/$250

To calculate income reduction amount for the fortnight, use the following formula:

  • For allowance customers the income free area is $150, income reduction amount = {(ordinary income for the fortnight - $256) x 60%} + $53
  • For YA (Job seeker) customers the income free area is $150, income reduction amount = {(ordinary income for the fortnight - $250) x 60%} + $50

If the customer has employment income and receives nil rate due to the income test, advise the customer they may remain current at a nil rate for a period of up to 12 consecutive fortnights. See Employment income nil rate period.

7

Coding employment income + Read more ...