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. If the increase was advised outside of the annual review process, no action is required. Procedure ends here.

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

Has the customer provided the income details either verbally, via the Advise Parental Income online service, or on a form?

• Yes, refer to one of the following for assessment information, and then go to Step 3:
• Applying the Parental Income Test (PIT) for ABSTUDY and Youth Allowance (YA)
• Youth Allowance (YA) and ABSTUDY Parental Income Test (PIT) reviews
• Assessing the Assistance for Isolated Children (AIC) Current Income Assessment (SY042)
• No, and a form is required:
• Request the MOD JY/SY012(A)/SY042, see Requesting information (CLK)
• Procedure ends here until income details are provided

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 Step 4.

Update 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
• Select Save
• Enter the Receipt Date, Channel and Service Reason:
• Note: select the relevant Service Reason for the update
• Select Assess and address any errors/warnings on the Errors (SWE) screen
• Select Assess and check outcome on the Entitlement (ELD) screen
• Select Finish and record details of the update in the finalisation notes
• Select Finalise

Note: repeat this process to update all dependent sibling records.

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

Procedure ends here.

Update 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: repeat this process to update all dependent 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.

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.

If the decrease occurred:

• in the current tax year, go to Step 7
• after the current tax year, go to Step 6

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 do not need to be supplied again
• cancelled Parental Income too High (PIH), the customer needs to submit a new claim

Procedure ends here.

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

• Yes, go to Step 8
• No, there is no change to the appropriate tax year and the customer's rate of payment will not change. Go to Step 12

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

Has the customer supplied MOD JY/evidence?

• Yes, go to Step 9
• No, issue the form using the Mail Forms function in Customer First, 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. Procedure ends here

Note: when assessing a new claim, continue processing the claim if it can be granted based on the base tax year.

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 Assistance for Isolated Children (AIC) Current Income Assessment (SY042) form is required.

Has the customer provided an Assistance for Isolated Children (AIC) Current Income Assessment (SY042) form?

• Yes, go to Step 9
• No:
• Request the Assistance for Isolated Children (AIC) Current Income Assessment (SY042) form, see Requesting information (CLK)
• Procedure ends here

• 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 10
• No, base tax year is the appropriate tax year. Go to Step 12

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

Note: if the customer has requested a current year assessment in advance of the decrease, determine whether a manual review is required to ensure the estimate is still accurate closer to the event.

Go to Step 11.

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 Step 11.

Update 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
• Select Save
• Enter the Receipt Date, Channel and Service Reason:
• Note: select the relevant Service Reason for the update
• Select Assess and address any errors/warnings on the Errors (SWE) screen
• Select Assess and check outcome on the Entitlement (ELD) screen
• Select Finish and record details of the update in the finalisation notes
• Select Finalise

Note: repeat this process to update all dependent sibling records.

Procedure ends here.

• Update 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: repeat this process to update all dependent sibling records.

Procedure ends here.

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