Components of the Care Receiver Income and Assets (CRIA) test 108-03020020

A non-customer care receiver is subject to income and asset limits in order for their carer to qualify for Carer Payment (CP).

A non-customer care receiver’s income threshold and asset limits are determined under the Social Security Act (SSA) 1991.

The Care Receiver Income and Assets (CRIA) test does not apply to CP (XWP). For more information, see Transfer from Wife Pension (WP) to Carer Payment (CP).

For a new claim, the base tax year is used for the care receiver income test. The base tax year is the tax year that ended on 30 June in the previous calendar year. For example, John claims CP on 4 August 2009. It falls in the calendar year 1 January to 31 December 2009, so the base tax year is the tax year that ended on 30 June 2008 (i.e. the year of income beginning on 1 July 2007).

The appropriate tax year depends on whether a notifiable event has occurred. For a notifiable event to occur an event or change of circumstances must be specified in a notice under section 70 of the Social Security (Administration) Act and the notice must have been issued to the care receiver. If a notice has not been issued to the care receiver a notifiable event could not have occurred.

A notifiable event has occurred

If a notifiable event occurs in relation to a care receiver or any of 2 or more care receivers and the care receiver’s taxable income, or the sum of the taxable incomes of the care receivers, for the tax year in which the notifiable event occurs exceeds the income ceiling, the appropriate tax year is the tax year in which the notifiable event occurs.

If a notifiable event occurs in relation to a care receiver or any of 2 or more care receivers and the care receiver’s taxable income, or the sum of the taxable incomes of the care receivers, for the tax year in which the notifiable event occurs (the event tax year) does not exceed the income ceiling and the care receiver’s taxable income, or the sum of the taxable incomes of the care receivers, for the tax year that follows the event tax year is likely to exceed the income ceiling, the appropriate tax year is the year that follows the event tax year.

A notifiable event has not occurred

The base tax year is the tax year that ended on 30 June in the previous calendar year. The base tax year does not change for increases in the care receiver’s assets.

See the Resources page for examples.

A care receiver with taxable income over the care receiver's income threshold in the base tax year can pass the care receiver income test if:

• their written estimate of their taxable income for the current financial year is reasonable, and
• is below the care receiver income threshold

In these cases, the:

• appropriate tax year is the current financial year, rather than the base tax year
• estimate for the current financial year should be recorded

If the current tax year will be used, the earliest date to assess qualification for CP is the day on which the written request was given.

For the care receiver income thresholds see the Carer Payment (CP) - Care Receiver Income and Asset Limits link on the Rates and Thresholds page.

The appropriate tax year for the care receiver income test is generally the current financial year if the assets are above the care receiver assets test limit. This is because a care receiver may be exempted from the assets test depending on their:

• assets value
• liquid assets, and
• estimated current financial year taxable income

For these cases the appropriate tax year is usually the current financial year, rather than the base tax year. For care receiver income thresholds and assets limits see the Carer Payment (CP) - Care Receiver Income and Assets Limits link on the Rates and Thresholds page.

The income assessed for a non-customer care receiver is based on their personal circumstances (for example, single or partnered, living with a parent/guardian, etc.), and their income in the appropriate tax year as set out in the SSA. It does not include any non-taxable income.

Note: Paid Parental Leave (PPL) is not exempt income for the CRIA test, as it is taxable income.

National Disability Insurance Scheme (NDIS) funds, whether received periodically or as a lump sum (including interest accrued), which are deposited into an account specifically for the purpose of managing the customer's NDIS plan, are exempt from the income and assets tests and deeming. They do not need to be reported but if they are should not be considered in the income and asset assessment.

Once income qualification is established, the non-customer care receiver assets test is applied.

There are different types of Department of Veterans' Affairs (DVA) payments and different processes to follow when customers advise they receive DVA income.

For care receivers income thresholds and asset limits see the Carer Payment (CP) - Care Receiver Income and Asset Limits link on the Rates and Thresholds page.

If the adult care receiver is receiving a Social Security pension or benefit, or a DVA Service Pension, Income Support Supplement or a Veteran Payment, they are exempt from the CRIA test.

An adult care receiver can qualify their carer for CP, if the only reason they are not being paid a Social Security pension, or a DVA Service Pension, Income Support Supplement or Veteran Payment is because they have not been an Australian resident for a long enough period. This means they have met all other requirements such as incapacity for Disability Support Pension (DSP) and passed the income and assets tests applicable to each type of payment.

Note:

• ABSTUDY is not defined as a social security pension or benefit, therefore a care receiver receiving ABSTUDY does not exempt the carer from the non-customer CRIA test
• Only Social Security pension and income support payments from DVA can qualify under the residence criteria. This means a qualification for JobSeeker Payment (JSP), Youth Allowance (YA) or Special Benefit (SpB) will not meet the requirements of the Social Security Act, section 198(7) of the legislation

For a carer to be paid CP for a child care receiver under 16, the income and assets of the child being cared for (and if the child lives with their parent/legal guardian, the income and assets of the parents and their Family Tax Benefit (FTB) children) must not exceed the CRIA test limits. There is no exemption from the CRIA test for a child care receiver.

The non-customer care receiver assets test includes assets within and outside Australia and the value of the asset is the net market value. Assets exempt under the Social Security Act are not included in the CRIA assets test.

If a non-customer care receiver's assets are over the minimum care receiver assets test limit, they may be exempt from the test depending on the value of their assets, liquid assets and the income amount that will be used in calculating the income limit.

Liquid assets limits are $6,000 for single people and $10,000 combined for partnered people. For care receiver assets test limits see the Carer Payment (CP) - Care Receiver Income and Asset Limits link on the Rates and Thresholds page.

A decision may be made to exempt a non-customer care receiver from the non-customer care receiver assets test where all the following conditions are met:

• a request has been made by the carer (for an adult care receiver) or the carer/parent (for a child care receiver or 2 or more child care receivers)
• the request is that the assets test not be applied
• the request provides a written estimate of the appropriate taxable incomes for the current tax year
• the estimate is accepted as being reasonable

The effect of these exemption provisions is that some people with assets above the care receiver assets test threshold will be considered to meet the assets test if their liquid assets and current income are below the exemption thresholds.

They still need to meet the care receivers' income threshold. The Process page identifies the persons whose assets and income are to be included in the relevant tests. For care receiver income thresholds and asset limits see the Carer Payment (CP) - Care Receiver Income and Asset Limits link on the Rates and Thresholds page.

National Disability Insurance Scheme (NDIS) funds, which are deposited into an account used to manage the customer's NDIS plan, are exempt from the income and assets tests and deeming. This includes funds received periodically or as a lump sum, including interest accrued. These funds are not required to be reported or if reported should not be taken into account in the income and assets assessment.

Assets that are obtained to assist the care receiver in respect of their disability (for example, motorised scooters) are exempt from the assets test. Where there have been modifications made to a car, the value of the modifications are exempt however, the value of the car that does not relate to the modifications is assessable. Service Officers need to verify the value of the modifications and subtract this amount from the final value of the motor vehicle. However, if the car is exclusively designed for use by a disabled person, for example special wheelchair access, special driving controls, other design features, then the whole value of the car would be exempted.

Where a customer, their partner or dependent child is disabled and there is an increase in the value of assets as a result of purchase or modifications (that is, to a car or home) to accommodate disabilities, these assets are disregarded when assessing the total value of the asset.

The procedures, Exempt income and Exempt Assets, provide information about assessing income and assets that is exempt from the Income and Assets Tests.

A family with assets above the assets value limit for non-customer care receivers can only be considered to meet the assets test if:

• their assets are in the Medium Range and:
• their income is under the care receiver income test, or
• their assets are in the High Range and:
• their liquid assets are below the liquid asset limit and
• their current taxable income is below the special income test required for assets test exemption

An overpayment of CP can occur when the actual taxable income of the care receiver (and any other person included in the care receiver income test) is more than the income limit. See the Resources page in Care Receiver Income and Assets.