Increase or decrease in parental income for Youth Allowance (YA), ABSTUDY and Assistance for Isolated Children (AIC) 108-02020020

Has there been a change in parental income?

• Yes, where parental income has:
• increased in the current tax year, go to Step 2
• decreased in the current tax year, go to Step 5
• No, there is no change to the base year, go to Step 10

Determine if parental income has increased by more than 25% of the base tax year income and more than 25% of the parental income free area (PIFA). For the current PIFA see the Parental Income Test (PIT) – Youth Allowance (YA) link in the Rates and Thresholds index.

Parental income increases of less than 25% of the base year income and the PIFA will be collected and coded during the annual PIT review process and will affect payment rates from the entitlement period that includes 1 January of the following year.

Where the increase is more than 25% of the base year income and the PIFA, ask the customer to provide an estimate of the parental income for the current tax year. This estimate can be provided for:

• YA and ABSTUDY customers, via:
• the Advise Parental Income online service
• a Module JY - Parent(s)/Guardian(s) details for the Base Tax Year and Current Tax Year (MOD JY)
• a Youth Allowance/ABSTUDY Annual Parental Income Reassessment (SY012(A)) for the correct current year, or
• a verbal statement if parent(s) are present
• AIC Additional Boarding Allowance (ABA) customers, an Assistance for Isolated Children (AIC) Current Tax Year Assessment (SY042). AIC applicants receiving ABA assessed on parental income are also sent a letter in August or September each year asking them to contact if they think the income for current tax year has increased by more than 25% of the base tax year income and more than 25% of the PIFA

Request the MOD JY/SY012(A)/SY042, see Requesting information (CLK).

When the MOD JY/SY012(A)/SY042 is returned, see one of the following for assessment information:

• Completing Parent(s)/Guardian(s) details for the Base Tax Year and Current Tax Year (MOD JY)
• Youth Allowance (YA) and ABSTUDY Parental Income Test (PIT) reviews
• Assessing the Assistance for Isolated Children (AIC) Current Income Assessment (SY042)

If there has been an increase of more than 25% of the base tax year income and more than 25% of the parental income free area (PIFA), the customer’s/AIC applicant’s rate will be based on the current year parental income from:

• the first pay period that ends after 30 September in the current calendar year for YA customers (the new rate applies for the entire entitlement period), or
• 1 October for ABSTUDY and AIC ABA customers/applicants. For AIC, this is called a Reverse Current Income Assessment

If an increase in parental income occurs after the current tax year, there is no effect on the customer's/applicant's entitlement in the year of study/activity. It may however, affect the YA customer's entitlement from the first pay period that ends after 30 September or the ABSTUDY/AIC ABA customer's/applicant's payment from 1 October in the following year.

If YA or ABSTUDY Living Allowance is no longer payable because of the increase in parental income, the parent may qualify for Family Tax Benefit (FTB) for the student.

If AIC ABA is no longer payable, AIC Basic Boarding Allowance remains payable. FTB can also remain payable for a student for whom AIC is being received. See Family Tax Benefit (FTB) child of a person.

Go to the Parental Income (NHI) screen:

• Financial Year: the current tax year
• Start Date: see Event date for parental income
• Estimate Indicator field code:
• Y - if the income is an estimate
• N - if income is actual income
• Review Date: required if Estimate Indicator field is Y. The date provided by the parent advising when the actual income details will be available
• Taxable Income: for the parents and in the corresponding fields, details of any:
• overseas income
• maintenance paid
• voluntary maintenance received
• business/investment loss
• reportable super
• tax free pensions/benefits, and
• reportable fringe benefits
• Save
• Receipt Date, Channel and Service Reason:
• Note: if the system does not select a default Service Reason, select the most relevant Service Reason for the update
• Assess and address any errors/warnings on the Errors (SWE) screen
• Assess and check outcome on the Entitlement (ELD) screen
• Finish and record details of the update in the finalisation notes
• Finalise

Note: if a parent or guardian advise an increase in income, update all sibling records.

If the date of effect is in the past, a debt may be created by the system for investigation.

Procedure ends here.

• Go to the Household Income and Assets (NHI) screen
• Event Date: see Event date for parental income
• Financial Year Ending: as the current tax year
• Estimate:
• Y if the income is an estimate
• N if income is actual
• Review Date: required if Estimate field is Y. The date provided by the parent advising when the actual income details will be available
• Taxable Income: for the parents and in the corresponding fields, details of any:
• overseas income
• maintenance paid
• passive business / investment loss
• reportable super
• tax free pensions/benefits, and
• reportable fringe benefits
• Source and DOR: as appropriate
• Action field: I (insert)
• Finalise via the Assessment Results (AR) screen
• Record all relevant details in a DOC

Note: if a parent or guardian advise an increase in income, update all sibling records.

If the date of effect is in the past, a debt may be created by the system for investigation.

Procedure ends here.

Ask the customer or the parent/guardian:

• when the decrease in income occurred
• if the decrease is likely to last for at least 2 years

A current year assessment may be made if there has been a substantial decrease in parental income that occurred in the current tax year that will last at least 2 years.

Where the decrease occurs after the current tax year, a current year assessment cannot be applied until 1 January of the following year. If the customer’s payment is:

• current, they will need to re-contact on or after 1 January to request a current year assessment. If supporting documents (such as MODJY or payslips) have been supplied, they will not need to be supplied again
• cancelled Parental Income too High (PIH), the customer needs to submit a new claim

A customer may request a current year assessment up to 13 weeks in advance of the event. However, there must be sufficient evidence to support the estimate provided.

Is the current year decrease substantial and will the decrease in income last at least 2 years?

• Yes, go to Step 6
• No, there is no change to the appropriate tax year and the customer's rate of payment will not change. Go to Step 10

A MOD JY and evidence of the decrease in income are required. Examples of evidence may include (but are not limited to):

• payslips
• a notice indicating change or loss of employment, or
• medical evidence about work limitations

If the MOD JY/evidence has not been requested or supplied, issue the form and/or request the evidence verbally. A Request for Information (RFI) is not used as the information being requested is not essential and the customer will not be suspended or cancelled for not supplying it. Ask the customer to contact again when evidence has been supplied and record a DOC with the details of the request/conversation.

When the MOD JY and evidence have been supplied, go to Step 7.

Where an AIC customer's parent/person deemed to be a parent for the purposes of the parental income test has a decrease in income that will last at least 2 years, an SY042 and evidence of the decrease in income are required. Examples of evidence may include (but are not limited to):

• payslips
• a notice indicating change or loss of employment, or
• medical evidence about work limitations

Issue the customer or the parent/person deemed to be a parent for the purposes of the Parental Income Test (PIT) with a SY042 form. See the Resources page for a link to the form

Record the issuing of the form in a DOC and resubmit for 14 days. For full details on assessment, see Assessing the Assistance for Isolated Children (AIC) Current Income Assessment (SY042)

When the SY042 and evidence have been supplied, go to Step 7

• Examine information the customer's parents have provided about their income and decide if the current year is the appropriate tax year
• Compare estimated income for the current year with previously supplied details for the base tax year

Will using current tax year income give the customer entitlement to payment or increase the current rate of payment?

• Yes, current tax year is the appropriate tax year. Go to Step 8
• No, base tax year is the appropriate tax year. Go to Step 10

For ABSTUDY and AIC customers if the change occurs:

• before 1 January in the year for which assistance is being claimed, a current tax year assessment applies from 1 January
• on or after 1 January in the year for which assistance is being claimed, from the date the decrease occurred

If the customer has requested a current year assessment in advance of the decrease, determine whether a Manual Follow-up (MFU) action is required to ensure the estimate is still accurate closer to the event.

For YA customers, see Event date for parental income.

A decrease in parental income that occurs after the current tax year does not affect:

• YA payments until the Entitlement Period Start Day (EPSD) immediately before 1 January of the following calendar year. If 1 January is coded in the Event Date: field of the NHI screen, the system will automatically apply this from the EPSD immediately before 1 January
• ABSTUDY or AIC ABA payments until 1 January of the following calendar year

Go to the Parental Income (NHI) screen:

• Financial Year: the current tax year
• Start Date: see Event date for parental income
• Estimate Indicator field code:
• Y - if the income is an estimate
• N - if income is actual income
• Review Date: required if Estimate Indicator field is Y. The date provided by the parent advising when the actual income details will be available
• Taxable Income: for the parents and in the corresponding fields, details of any:
• overseas income
• maintenance paid
• voluntary maintenance received
• business/investment loss
• reportable super
• tax free pensions/benefits, and
• reportable fringe benefits
• Save
• Receipt Date, Channel and Service Reason:
• Note: if the system does not select a default Service Reason, select the most relevant Service Reason for the update
• Assess and address any errors/warnings on the Errors (SWE) screen
• Assess and check outcome on the Entitlement (ELD) screen
• Finish and record details of the update in the finalisation notes
• Finalise

Note: if a current year assessment is applied for a decrease in income update all sibling records.

Procedure ends here.

• Go to the Household Income and Assets (NHI) screen
• Event Date: see Event date for parental income
• Financial Year Ending: as the current tax year
• Estimate:
• Y if the income is an estimate
• N if income is actual
• Review Date: required if Estimate field is Y. The date provided by the parent advising when the actual income details will be available
• Taxable Income: for the parents and in the corresponding fields, details of any:
• overseas income
• maintenance paid
• passive business / investment loss
• reportable super
• tax free pensions/benefits, and
• reportable fringe benefits
• Source and DOR: as appropriate
• Action field: I (insert)
• Finalise via the Assessment Results (AR) screen
• Record all relevant details in a DOC

Note: if a current year assessment is applied for a decrease in income update all sibling records.

Procedure ends here.

Record details of decision to apply/not apply a change to the appropriate tax year in a DOC.