Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-07060020

Do not reconcile the estimate if the case has ended or is about to end due to family and domestic violence. Manual assessments usually are in place and must not be updated.

• Set the Reconciliation Status of the estimate to Recon-No Change in the Estimate Income window
• Document the following in a notepad on the relevant estimate in the Client Income window:
• Subject: Recon No Change
• Text: Manual assessments have been used to set the annual rates for this estimate period. Estimate Reconciliation is not required

Note: if manual assessments are not in place, seek Service Support Officer (SSO) support to confirm the correct action needed, see Technical support in Child Support.

Procedure ends here.

Work with the specialist area if the estimating customer:

• is managed in a specialist area, or
• has an intray that is managed in a specialist area

The specialist area may need to manage customer contact about the estimate reconciliation. In some cases, a specialised intray may need finalising before the estimate reconciliation is processed.

Follow the Customer Management Approach (CMA) process.

Before starting any manual intervention, run and check eligibility. Resolve any issues before starting the estimate reconciliation.

If help is needed to resolve any issues, seek help from an SSO.

Note: additional steps may be needed to apply the estimate reconciliation outcome to Reverse Cases. See Table 18 to determine any extra steps needed.

If a customer lodges a tax return, and auto reconciliation is not possible, Cuba will create a:

• Pending Auto Reconciling Inc intray, or
• Reconciliation Required intray

If a Pending Auto Reconciling Inc intray is created, Cuba pre-populates the estimate reconciliation calculator with the income details.

If a Reconciliation Required intray is created, Cuba does not pend a reconciling income. The actual ATI for the financial year will need to be manually loaded into the estimate reconciliation calculator after a decision is made.

In some circumstances, manual intervention is required but neither of the above intrays automatically create. An Est Rec Tax Ret Not Lodged intray or an Estimate Rec intray will have been created manually. Check the notepad to see the explanation of why it was created.

For Pending Auto Reconciling Inc and Reconciliation Required intrays:

• Check the 'Effective Date’ of the intray
• Check the Client Income window for an income with an ‘Effective Date’ or a ‘Notification Date’ that matches the ‘Effective Date’ of the intray
• Note the financial year of the identified income
• The estimate in that same financial year will need manual intervention

Note: multiple intrays indicate, there are multiple estimates that need intervention. These could be the same estimate on reverse cases, the same estimate on different cases and/or different estimates for different financial years.

For Est Rec Tax Ret Not Lodged and Estimate Rec intrays:

• Check the notepad of the intray. The notes must indicate which estimate/s requires manual intervention

Cancelled ATO incomes

The ATO ICP system may indicate that an ATO income has been, or will be, cancelled. The Solutions Gateway Team (SGT) will remove cancelled ATO incomes from Cuba after confirmation from the ATO. If an estimate was reconciled based on an ATO income that is now cancelled, the reconciling income must also be cancelled. If a valid ATI is available, consider if re-reconciliation is required. Follow the process for Correcting errors on Child Support cases.

Generally, if the actual Adjusted Taxable Income (ATI) is:

• higher than the estimated ATI, the estimate will be reconciled
• lower than or equal to the estimated ATI, the estimate will be set to ‘Recon No Change’

However, some exceptions may apply.

Do not reconcile the estimate if reconciling the estimate with a higher income will benefit the estimating parent. Set the status of the estimate to Recon-No Change to prevent an unintended outcome.

E.g., if the estimating parent was assessed to pay the Fixed Annual Rate (FAR), reconciling with a higher income may produce an unintended result. The liability of a paying parent could reduce or the entitlement of a receiving parent could increase, even though their actual income was higher than their estimate. In these circumstances, the estimate must be set to Recon-No Change.

Example notepad

Subject: Recon No Change

Text: The customer was assessed to pay at the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.

In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.

The status of the estimate has been set to Recon-No Change.

Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-07060020

For more details, see the Background page.

There are exceptions which prevent automatic reconciliation of an estimate.. Manual intervention is required by a Service Officer with the estimate reconciliation skill set.

Note: more than one exception can exist for the same estimate. If needed, seek help from an SSO managing multiple exceptions.

From the list below, identify the reason/s why manual intervention is needed. Follow the link to the relevant table.

Check the Case Liability Rates window for rates with a ‘Type’ of RVA, AGR, CVA or CO for any day in the Estimate Period. Check the details of the Change of Assessment, Agreement or Court Order. If it sets the estimating parent’s income, sets an annual rate or sets a periodic amount for any day in the estimate period, go to Table 2.

If the estimate was lodged before 3 March 2011, check the Child Support Period window. If there is a WA Ex-Nup indicator during that estimate period, go to Table 3.

Check the Client Income window for any Post Separation Income (PSI) excluded during the financial year of the estimate. If a PSI is found, go to Table 4.

If the Client Income window shows an ATO (MAN) income for the same financial year as the estimate, go to Table 6.

If the Client Income window shows an ATO (TRDB) income for the same financial year as the estimate, go to Table 7.

From the Client Income window:

• select Search
• tick Show History, and then
• select Find

If there are 2 or more ‘Taxable Income’ entries for the same Financial Year as the estimate, go to Table 8.

If the Client Income window shows that the ATO has issued an ‘Amended Taxable’ income for the financial year that the Estimate is in, go to Table 9.

Check the Client Income window for a recently received CNLK or DVA - Non Tax income for the same Financial Year as the estimate. If there has not already been an earlier CNLK or DVA - Non Tax income for that same year, go to Table 10.

Check the Client Income window for a recently received CNLK or DVA - Non Tax income for the same financial year as the estimate. If there is another CNLK or DVA - Non Tax for that same year but with an earlier notification date, go to Table 11.

If the Client Income window shows a ‘CSA AMENDED EST’ in the financial year of the estimate, go to Table 12.

Check the ‘Indicators’ box on the front screen for both the estimating customer and the other customer in each case. If there is any indicator that a parent, non-parent carer or child is deceased, go to Table 13.

Open each of the Case Liability Rates window calculations during the Estimate Period. Check for any FAR which resulted from an initial or amended estimate. If the subsequent period has a lower annual rate due to a higher amended estimate, check the Amended Estimate details. If the Amended Estimate, has a Date of Event (DOE) which is different to the Date of Notification (DON), go to Table 14.

If the customer’s actual ATI assessed by the ATO is not showing in the Client Income window nor in ATO ICP and at least 12 months have passed since the end of the estimate year, go to Table 15.

Check the ‘Effective Date’ of the Pending Auto Reconciling Inc’ or ‘Reconciliation Required’ intray. Check the Client Income window for an ATO income with an ‘Effective Date’ or a ‘Notification Date’ that matches the ‘Effective Date’ of the intray. Check for an Estimate in that same financial year which has already been Reconciled or set to Recon No Change. If the attached notepad shows that the decision was based on a Determined income, go to Table 17.

Check the Client Income window. If there are any estimates, amended estimates or reconciling incomes that do not exactly match on each reverse case, go to Table 18.

An IAO means: a court-order (CO), a change of assessment (COA) decision or an agreement (AGR) that varies the annual rate of child support payable by setting the annual rate, the adjusted taxable income or the child support income, of a parent.

An estimate cannot be reconciled if an IAO is in place for the estimating parent for at least one day in the estimate period, however the estimate can still be reviewed.

Note: if the IAO sets the non-estimating parent’s income only, then the estimating parent’s estimate can be reconciled.

If the IAO is in place for:

• the entire estimate period, go to Step 2
• part of the estimate period, go to Step 3

If the IAO is in place for the estimating parent for the entire estimate period:

• set the Reconciliation Status of the estimate to Recon-No Change in the Estimate Income window
• document the following in a notepad on the relevant estimate in the Client Income window, update the text as required:
  Subject: IAO Recon-No Change
  Text: Estimate period dd/mm/yy to dd/mm/yy. Income amount order in place dd/mm/yy to dd/mm/yy. As the IAO is in place for the entire estimate period, an estimate review is not required and the estimate has been set to Recon-No Change.
  Legislation: <Document the relevant Legislative Reference>:
  Section 64(5) Child Support (Assessment) Act 1989 - single estimate election, when we have the Actual ATI, or
  Section 64A(5) Child Support (Assessment) Act 1989 - more than one estimate election, when we have the Actual ATI, or
  Section 64AC(5) Child Support (Assessment) Act 1989 - single estimate election, Determined ATI, or
  Section 64AD(5) Child Support (Assessment) Act 1989 - more than one estimate election, Determined ATI
• delete the Reconciliation Required intray

Procedure ends here.

Where the IAO is in place for only part of the estimate period, compare the Expected Adjusted Taxable Income (ATI) in the Estimate Income window to the actual ATI for the estimate.

Is the actual ATI higher than the expected ATI?

• Yes, review the estimate to determine whether the assessment will be affected as per Child Support estimates review (post 1 July 2010). Go to Step 4
• No, the actual income is lower than the ATI:
• Set the Reconciliation Status of the estimate to Recon-No Change in the Estimate Income window
• Document the following in a notepad on the relevant estimate in the Client Income window, update the text as required:
  Subject: Recon-No Change
  Text: Estimate period dd/mm/yy to dd/mm/yy. Income amount order in place dd/mm/yy to dd/mm/yy. Actual ATI $xxx is not higher than the Expected ATI $xxx therefore an estimate review is not required. The estimate has been set to Recon-No Change
• Delete the Reconciliation Required intray
• Procedure ends here

Check:

• IAO documentation
• estimate documentation
• Notice of Decision (NTD) made through the Change of Assessment (COA) process, see Finalising a change of assessment (COA) application

Consider:

• Whether the NTD/AGR/CO made any reference to the estimate and the assessment used over the estimate period. E.g., NTD/AGR/CO containing the IAO refers to the Estimate and states that no further changes should be made to the estimate period
• The findings set out in the NTD/AGR/CO in regards to the amount set in the IAO
• Why the IAO was used as the basis of the assessment
• Any other relevant information included in the NTD/AGR/CO to determine whether the estimate is to be amended through the review
• Refer to 'Reviewing/Amending estimates affected by income amount orders (IAOs) scenarios' on the Resources page

Seek Service Support Officer (SSO) support if needed, see Technical support in Child Support.

Does the estimate need reviewing?

• Yes, go to Step 5
• No,
• Set the Reconciliation Status of the estimate to Recon-No Change in the Estimate Income window
• Document the following in a notepad on the relevant estimate in the Client Income window, update the text as required
  Subject: IAO Recon-No Change
  Text: Estimate period dd/mm/yy to dd/mm/yy. Income amount order in place dd/mm/yy to dd/mm/yy. Estimate review is not required as the IAO prevents any amendment to the period of review dd/mm/yy to dd/mm/yy. (Document basis of your decision - refer to 'Reviewing/Amending estimates affected by income amount orders' on the Resources page
  Legislation: <Document the relevant Legislative Reference>:
  Section 63A Child Support (Assessment) Act 1989, and
  Section 64(5) Child Support (Assessment) Act 1989 - single estimate election, when we have the Actual ATI, or
  Section 64A(5) Child Support (Assessment) Act 1989 - more than one estimate election, when we have the Actual ATI, or
  Section 64AC(5) Child Support (Assessment) Act 1989 - single estimate election, Determined ATI, or
  Section 64AD(5) Child Support (Assessment) Act 1989 – more than one estimate election, Determined ATI
• Delete the Reconciliation Required intray
• Procedure ends here

Identify:

• the estimate period for review. E.g., estimate period originally 1/7/2017 - 30/6/2018. IAO in place from 11/2/2018 - 30/06/2018. Estimate period to review is 1/7/2017 - 10/2/2018
• the income received for the period under review
• the event/s affecting the accuracy of the estimate in the period under review

See Child Support estimates review (post 1 July 2010)

Is the estimate to be amended?

• Yes:
• Record the CSA amended estimate, follow the process described in 'Reviewing/Amending estimates affected by income amount orders' on the Resources page
• Document the details of the amended estimate
• Go to Step 6
• No, go to Step 6

• Set the Reconciliation Status of the estimate to Recon-No Change in the Estimate Income window
• Document the following in a notepad on the relevant estimate in the Client Income window, update the text as required
  Subject: Recon-No Change
  Text: Estimate period dd/mm/yy to dd/mm/yy. Income amount order in place dd/mm/yy to dd/mm/yy. Estimate cannot be reconciled, only reviewed as there is an IAO in place. Period of review dd/mm/yy to dd/mm/yy.
  Document one of the following:
  Estimate review finalised and the estimate has been amended, or
  Estimate review finalised and the estimate is considered accurate. (document basis of your decision)
  Legislation: <Document the relevant Legislative Reference>:
  Section 63A Child Support (Assessment) Act 1989, and
• Section 64(5) Child Support (Assessment) Act 1989 - single estimate election, when we have the Actual ATI, or
• Section 64A(5) Child Support (Assessment) Act 1989 - more than one estimate election, when we have the Actual ATI, or
• Section 64AC(5) Child Support (Assessment) Act 1989 - single estimate election, Determined ATI, or
• Section 64AD(5) Child Support (Assessment) Act 1989 – more than one estimate election, Determined ATI
• Delete the Reconciliation Required intray

Procedure ends here.

An estimate will not automatically reconcile if a WA Ex-nuptial indicator is on the case at any time during the financial year (FY), and a financial year estimate was lodged before 3 March 2011. A Reconciliation Required intray will automatically create.

• Determine the actual ATI to use for the estimate reconciliation, see Child support estimates - Reconcile (pre 1 July 2011)
• Load the actual ATI details into the Estimate Reconciliation calculator, see Estimates Cuba Process Help for details
• Delete the Reconciliation Required intray
• See Table 19, Step 2

An estimate will not automatically reconcile if PSI has been excluded from the assessment for all or part of the child support period (CS Period) . A Reconciliation Required intray will automatically create when the taxable income is available from the ATO.

To correctly account for PSI in an estimate reconciliation, manual intervention is needed.

Compare the expected Adjusted Taxable Income (ATI) with the actual ATI.

The calculation for the expected ATI includes all estimated incomes and excludes PSI. This applies even where the estimate has been revoked due to the PSI effective start date being equal to the estimate start date.

Is the actual ATI higher than the expected ATI?

• Yes, go to Step 2
• No:
• Set the Reconciliation Status of the estimate to Recon-No Change in the Estimate Income window
• Document the decision:
  Subject: Est Rec-No Change
  Text: There was a PSI in the same CS Period as the estimate. This prevented auto-reconciliation. As the actual ATI was not higher than the expected ATI, no further reconciliation action is required The estimate will be set to Recon No Change.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent's actual adjusted taxable income - single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent's actual adjusted taxable income - more than one election

• Save the Reconciliation Status as Recon-No Change
• Delete the Reconciliation Required intray
• Procedure ends here

Determine if the PSI amount has been excluded from the estimated income at any point during the estimate period, by accessing the details in the Post Separation Income window. To access these details:

• from the Client Income window
• select the Go menu
• highlight Post Separation Income

In the Post Separation Income window, check if there is a PSI entry which meets both the following conditions:

• has an Effective Date (start date) within the Estimate period. The effective date must be in the period between the start date of the estimate and 30 June - not before or after this period and not just in the Year to Date period
• when the PSI entry is highlighted, the assessment income that the PSI is excluded from is the estimated income. To check this: as you highlight each PSI entry within the estimate period, look at what income type appears in the field called ‘Assmnt Income’. If the income type code in that field shows as ‘EST’, ‘REP’ or ‘REV’, then the PSI has been excluded from that estimate

Have both of the above conditions been met?

• Yes, go to Step 5
• No, go to Step 3

If the, ’Assmnt Income’ field for the PSI entry shows any income code other than EST, REP or REV. then the PSI was not excluded from the estimate.

If the PSI was excluded from another type of income such as ‘’TAX’, ‘CDER’ or ”REC then more checks are required. We must check how the PSI decision was made and whether it should also have been applied to the estimate period.

If the PSI was excluded from an estimate that had already been reconciled

If the PSI was excluded from a reconciled estimate, the ‘Assmnt Income’ field for the PSI entry will show as ‘REC’. No manual workarounds are required. The reconciling income was already used in the assessment when the PSI decision was made. The correct PSI amount should already have been applied. No more action is needed, unless there appears to have been an error in the reconciliation or the PSI decision. Consult an SSO if there appears to have been an error. The Correcting Errors process may be required.

If the PSI was excluded from another income type

PSI is excluded from a specific income record, such as ATO assessed income. When that income is replaced by an estimate, the system ends the PSI exclusion. This is correct if the customer is no longer earning any income that meets the definition of PSI.

Example: PSI correctly not excluded from estimate

PSI had been excluded from a customer’s ATO supplied ATI. The ‘Assmnt Income’ field for the PSI entry shows as ‘TAX’. PSI was excluded due to the customer’s overtime income which started after separation. Customer then ceased doing any overtime and lodged an estimate. Their estimated income for standard hours did not meet the definition of PSI income. The PSI was correctly not excluded from the estimate.

However, if the PSI exclusion is still relevant, it should also be applied to the estimated income. A new PSI exclusion entry should be recorded against the estimate.

Compare the source of the estimated income with the source of the PSI income. Check all the details in both the PSI decision notepad and the estimated income notepad. Determine if the PSI amount should have also been applied to the estimated income. This should happen if there was still valid PSI being earned in the estimate period.

Example: PSI should have been excluded from estimate but was not

Customer had successfully applied for PSI to be excluded from their ATO supplied ATI The ‘Assmnt Income’ field for the PSI entry shows as ‘TAX.’ PSI was excluded due to income from a second job they started after separation. Customer had normally worked overtime in their first job. The overtime in the first job has ceased and the customer had lodged an estimate. The customer was still working the second job, so the PSI that related to the second job should have continued to be excluded from the estimated income.

If the PSI should have been excluded from the estimate but was not, seek help from an SSO. See Technical support in Child Support. The Correcting Errors process may need to be followed. Once any required corrections have been processed, go to Step 5.

If the PSI has correctly not been excluded from the estimate, go to Step 4.

If the PSI was not excluded from the estimate and this decision appears to be correct:

• no PSI workaround is required to reconcile the estimate, and
• the estimate can now be manually reconciled in the usual manner

Note: if no actual ATI is available 12 months after the estimate year ended, see Table 15 to determine the income to reconcile the estimate with.

If the actual ATI details are available:

• load these details in to the Reconciliation Calculator
• determine if the estimate of income should be reconciled or set to a status of Recon-No Change. See Estimates Cuba Process Help
• Save and document the outcome. Use the following notepad:
  Subject: Est Rec Outcome
  Text: There was a PSI in the same CS Period as the estimate. This prevented auto-reconciliation. The PSI has been checked and was found to have not applied to this estimate. The estimate can be reconciled in the usual manner.
  The estimate has been checked using the parent’s actual ATI. The estimate will be: reconciled / set to Recon No Change (delete the one that is not required)
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income – single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income – more than one election If the estimate required reconciliation, check that the correct letters have generated

If reconciliation was not required, check that the status has been set to ‘Recon No Change’.

Procedure ends here.

If a PSI exclusion has been applied to any part of the estimate period:

• pend a reconciling income in Cuba to test the potential outcome of reconciliation. See Table 3 in Estimates Cuba Process Help
• in the Reconciling Estimate Income window, select PSI from the Created Reason dropdown menu
• select Pended from the Status dropdown menu to pend the estimate reconciliation.
• select No when asked about whether to send the customer a Pended reconciliation letter

Is there a change to the assessment?

• Yes, determine if the estimate needs reconciliation. If the estimate:
• requires reconciliation, see Table 5
• does not require reconciliation due to an unintended outcome, go to Step 6. E.g. a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated
• No, go to Step 7

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the intray
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add a notepad to explain the unintended outcome, for e.g.:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002

If there is no change to the assessment, in the Client Income window:

• select the pended reconciling entry and open
• document the following in the pended reconciling entry.
  Subject: PSI Est Rec No Change
  Text: Reconciliation resulted in no change to the assessment and the estimate has been set to Recon-No Change.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election
• delete the pended reconciling entry
• select the associated estimate and open
• set the Reconciliation Status of the estimate to Recon-No Change in the Estimate Income window
• document the following in a new notepad
  Subject: PSI Est Rec No Change
  Text: Reconciliation resulted in no change to the assessment and the estimate has been set to Recon-No Change. Refer to deleted reconciling entry

Procedure ends here.

When an estimate is reconciled, the reconciled income replaces the estimated income. If PSI has been excluded from the estimated income, manual intervention is needed to make sure that the PSI amount continues to be excluded after the estimate is reconciled.

The approved workaround is different depending on whether the PSI exclusion applies to:

• the entire estimate period
• part of the period, or
• the PSI exclusion amount differs throughout the estimate period

Does one PSI exclusion amount apply to the entire estimate period?

• Yes, go to Step 2
• No, go to Step 5

Where the one PSI exclusion rate is in place for the entire estimate period, it can be entered into the reconciliation calculation directly. Add the PSI exclusion amount as a deduction to make sure the correct income is applied for reconciliation purposes.

• Open the pended reconciling entry from the Client Income window
• Select the Reconciliation Calculator box from the Reconciling Estimate Income window
• Select the Income/Deductions Details box in the Reconciliation Calculator window
• Key the PSI amount as a deduction in the Details of Child Support Income/Allowable Deductions dialogue box as:
• Type: Allowable Deductions
• Description: Other Work Related
• Source: Other
• Title: Post Separation Income
• Start Date: this is the start date of the estimate
• End Date: 30/06/yyyy
• Amount: $XX.XX
• Select Add, then OK
• Select Calculate in the Reconciliation Calculator window to test the outcome of the reconciliation now that the PSI amount has been included as a deduction
  Note: in the Reconciliation Calculator the:
• Total Reconciling Income reflects the customer’s income less the PSI
• Total Estimated Income reflects the income as estimated by the customer. It does not include the PSI amount

Is there a change to the assessment?

• Yes, determine if the estimate needs reconciliation. If the estimate:
• requires reconciling, go to Step 3
• does not require reconciliation due to an unintended outcome, go to Step 8. E.g. a decrease in liability for a paying parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated
• No, go to Step 4

If reconciliation results in a change to the assessment and the estimate requires reconciliation:

• select OK
• document the following in the reconciling entry notepad in the Reconciling Estimate Income window:
  Subject: PSI - Manual Rec Req’d
  Text: One amount of Post Separation Income (PSI) was excluded from the parent's income for the entire period of the estimate - dd/mm/yyyy to dd/mm/yyyy. On receipt of the Taxable Income from the ATO, manual intervention was required to reconcile the estimate.
  Comparison of the expected ATI for the estimate period, $xxx.xx, with the actual income $xxx.xx, showed that the estimate was understated by $xxx.xx.
  To give effect to the PSI excluded amount in the reconciliation, the PSI amount for the estimate period has been included as a deduction in the Reconciliation Calculation.
  The assessment for the estimate period has been calculated using $xxx.xx which is the Taxable Income $xxx.xx less the PSI excluded amount $xxx.xx.
  A manual reconciliation version of the ME 4-3 letter has been automatically generated. This letter states that the parent's taxable income has not been received from the ATO. If the customer questions this, explain that the taxable income from the ATO was used as a basis for the reconciliation.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.

Finalise the reconciliation

• Update the Reconciling entry status from Pended to Recorded
• Select Save
• Check the letters
• Delete the Reconciliation Required intray
• Go to Step 13 to contact the customer

If reconciliation results in no change to the assessment:

• select OK to return to the Reconciling Estimate Income window.
• document the following in the reconciling entry notepad:
  Subject: PSI Est Rec No Change
  Text: One amount of Post Separation Income (PSI) was excluded from the parent's income for the entire period of the estimate - dd/mm/yyyy to dd/mm/yyyy. On receipt of the Taxable Income from the ATO, manual intervention was required to reconcile the estimate.
  To give effect to the PSI amount in the reconciliation, the PSI excluded amount for the estimate period has been included as a deduction in the Reconciliation Calculation.
  The assessment for the estimate period has been calculated using $xxx.xx which is the Taxable Income $xxx.xx less the PSI excluded amount $xxx.xx.
  This resulted in no change to the assessment. The Estimate has been set to Recon-No Change and the pended reconciliation entry deleted:
• leave the status as Pended in the Reconciling Estimate Income window
• select the pended reconciling entry in the Client Income window and select delete from the File menu
• select and open the associated estimate from the Client Income window
• set the Reconciliation Status of the estimate to Recon-No Change in the Estimate Income window
• document the following:
  Subject: PSI Est Rec No Change
  Text: Reconciliation resulted in no change to the assessment and the estimate has been set to Recon-No Change. Refer to deleted reconciling entry.
  Legislation: <include one of the following>:
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.
• select Save
• delete the Reconciliation Required intray

Procedure ends here.

The PSI cannot be entered into the reconciliation calculation directly:

• where the PSI exclusion applies to only part of the estimate period, or
• there are multiple PSI exclusion amounts and reconciliation is required

This is because the calculator does not allow the PSI to be entered for the relevant portion of the estimate period and would incorrectly count it as applying to the entire estimate period.

The approved workaround is to delete the PSI entry entirely, to give effect to the reconciling result then re-key the PSI entry. Deleting and re-keying the PSI entry will make sure the final assessment is calculated on the correct income.

Note: the PSI accepted amount can only be up to 30% of the income being used in the assessment. See Post separation income for Child Support customers for more details.

Make sure there is already a Pended reconciling income entry. If there is not:

• pend the actual reconciling income in Cuba to test the potential outcome of reconciliation. See Estimates Cuba Process Help, Reconcile a financial year estimate
• in the Reconciling Estimate Income window, select PSI from the Created Reason dropdown menu
• select Pended from the Status dropdown menu to pend the estimate reconciliation
• select No when asked about whether to send the customer a Pended reconciliation letter

Use Cuba to test the outcome of a potential reconciliation.

• In the Client Income window select and open the Pended Reconciling entry
• From the Reconciling Estimate Income window select the Reconciliation Calculator
• Select the Income/Deduction Details button
• Select OK to return to the Reconciliation Calculator
• Select Calculate
• Keep the reconciliation pended

Is there a change to the assessment?

• Yes, determine if the estimate needs reconciliation,. If the estimate:
• requires reconciliation, go to Step 9
• does not require reconciliation due to an unintended outcome go to Step 8. E.g. a decease in liability for a paying parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated
• No, go to Step 12

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the intray.
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add a notepad to explain the unintended outcome, for e.g.:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002

Procedure ends here.

Note: the PSI entry or entries must be deleted before the reconciliation is finalised. If the PSI entry is not deleted before finalising the estimate reconciliation, the PSI exclusion will cease to apply and Cuba will not allow it to be re-keyed. If this occurs, seek help from an SSO.

• Before deleting, make a note of all the details of the relevant PSI entry from the Post Separation window to allow re-entry of details (e.g., take a screen shot of the PSI entry and paste into a word document for reference)
• Delete the relevant PSI entry or entries. If on deletion MIR1-1/1-2 and MAC1-3/1-4 letters are generated, delete for both customers if not appropriate to issue, see Table 8 in Letters Cuba Process Help

Note: PSI entry or entries must be deleted before the finalisation of the reconciliation.

See Determine if the estimate requires reconciliation.,

If reconciliation results in a change to the assessment and the estimate requires reconciliation:

• change the reconciling entry status from Pended to Recorded
• add and pend a notepad with the following:
  Subject: PSI - Manual Rec Req’d
  Text: insert appropriate option - one or both may apply
  Post Separation Income (PSI) was excluded from the parent's income for part of the period of the estimate - dd/mm/yyyy to dd/mm/yyyy or
  Multiple PSI exclusion amount used during the estimate period
  On receipt of the parent's Taxable Income from the ATO, manual intervention was required to reconcile the estimate.
  Comparison of the expected ATI for the estimate period, $xxx.xx, with the actual income $xxx.xx, showed that the estimate was understated by $xxx.xx.
  To give effect to the PSI excluded amount in the reconciliation, the PSI entry/ies has been deleted, reconciliation completed and the PSI entry has been re-instated.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income -single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.
  Additional content <include one of the following>
  
  Estimating parent is Payer
  Deleting the PSI entry/ies resulted in an increase in the liability of $xxx.xx, Reconciliation of the estimate has resulted in an increase in the liability of $xxx.xx.
  Reinstating the PSI entry/ies has resulted in a decrease in the liability of $xxx.xx
  The difference of $xx.xx reflects that PSI was originally excluded from the estimated amount ($xx.xx) and the PSI has now been excluded from the reconciling income ($xx.xx). For further detail refer to the estimate reconciliation calculator. A manual reconciliation version of the ME 4-3 letter has been automatically generated. This letter states that the parent’s taxable income has not been received from the ATO. If the customer questions this, explain that the taxable income from the ATO was used as a basis for the reconciliation.
  
  Estimating parent is the Payee
  Deleting the PSI entry/ies resulted in a decrease in the liability of $xxx.xx.
  Reconciliation of the estimate has resulted in a reduction in the liability of $xxx.xx.
  Reinstating the PSI entry/ies has resulted in an increase in the liability of $xxx.xx.
  The difference of $xx.xx reflects that PSI was originally excluded from the estimated amount ($xxx) and the PSI exclusion has now been applied against the reconciling income ($xxx).
  For more details refer to the estimate reconciliation calculator.
  A manual reconciliation version of the ME 4-3 letter has been automatically generated. This letter states that the parent's taxable income has not been received from the ATO. If the customer questions this, explain that the taxable income from the ATO was used as a basis for the reconciliation.

• keep the notepad Pended so it can be updated after re-entering the PSI
• select Save
• re-enter the PSI, go to Step 11

Re-enter the PSI details as they appeared in the screen shot of Step 9.

Note: the PSI exclusion amount can only be up to 30% of the income being used in the assessment. See Post separation income for Child Support customers for more details.

• update the pended notepad on the Reconciling entry, now the PSI entry has been rekeyed, save the notepad
• check the letters

The Payer Account Balances in the Collection Summary window should reflect a:

• LIA-Increase Maintenance due to the removal of the PSI entry
• further LIA-Increase Maintenance as a result of the estimate reconciliation
• LIA-Estimate of Income Penalty
• LIA-Reduce Maintenance when the PSI entry has been re-keyed

Manually delete the Reconciliation Required intray, see Intray management Cuba Process Help.

Go to Step 13 to contact the estimating customer.

If reconciliation results in no change to the assessment:

• document the following in the pended reconciling entry:
  Subject: PSI Est Rec No Change
  Text: Manual intervention was required due to Post Separation Income exclusion for part of the estimate period or multiple PSI exclusion amounts applied.
  Examination identified that there will be no change to the assessment and the estimate has been set to Recon-No Change. No adjustment was required to the PSI entry and it will continue to be applied against the estimated income for the identified period.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election
• select the pended reconciling entry in the Client Income window and select delete from the File menu
• select and open the associated estimate from the Client Income window
• set the Reconciliation status of the estimate to Recon-No Change in the Estimate Income window

Document the following

Subject: PSI Est Rec No Change

Text: Reconciliation resulted in no change to the assessment and the estimate has been set to Recon-No Change. Refer to deleted reconciling entry.

For more details, see Documenting Child Support information.

Manually delete the Reconciliation Required intray, see Intray management Cuba Process Help.

Procedure ends here.

The Service Officer who has managed the Estimate Reconciliation must contact the estimating customer to discuss the outcome.

Contact attempts must be made in accordance with Contacting child support customers. A please contact letter must be sent if phone contact is not successful The customer must remain locked until the expiry date of the Please contact letter is reached.

If contact is successful, the Service Officer must discuss:

• how the original PSI decision was made
• how the estimate reconciliation took the PSI in to account
• whether that reconciling income could have included more PSI income that has not yet been accounted for
• whether the customer wants to make a new PSI election based on the new reconciling income

Note: if a new PSI election is made within the request for contact period, the Service Officer who managed the estimate reconciliation must complete the new PSI election. See Post separation income for Child Support parents.

All contact attempts and the required discussion points must be clearly documented in a notepad to assist with any future enquiries about the estimate reconciliation and/or possible new PSI election.

Check the ATO (MAN) notepad to make sure it is a valid ATO (MAN) and not an incorrectly selected income source.

Discuss with a Service Support Officer (SSO) if it is not a valid ATO (MAN) income.

If an ATO (MAN) income is loaded in Cuba, Cuba will compare this income to the expected ATI to determine whether reconciliation is needed.

Is the actual ATI higher than the expected ATI?

• Yes:
• a Pending Auto Reconciling Inc intray will generate
• go to Step 3
• No:
• the estimate does not need to be reconciled
• Cuba will automatically set the estimate’s Reconciliation Status to Recon-No Change
• from the Client Income window, select and open the original Estimate Income entry and add a notepad
  Subject: Est Rec No Change
  Text: An ATO (MAN) income has been loaded in Cuba. The Actual ATI is not higher than the expected ATI. Reconciliation of the estimate(s) is not required, and the estimate has been set to Recon-No Change.
• procedure ends here

Check the pended reconciling entry.

Does the estimate require reconciliation? See Determine if the estimate requires reconciliation.

• Yes, go to Step 4
• No, due to an unintended outcome, go to Step 6. E.g., a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated

From the Client income window:

• select and open the Pended reconciling income from the Client Income list box
• from the Reconciling Estimate Income window select the Reconciliation Calculator, select:
• Income/Deduction Details. Check the correct income details display
• OK to return to the Reconciliation Calculator
• select Calculate, then OK

From the Reconciliation Estimate Income window:

• select Recorded from the Status dropdown menu and Save

For more details, see Table 3 in Estimates Cuba process help.

Document the following in the reconciling entry notepad in the Client Income window.

Subject: ATO(MAN) Est Rec

Text: An ATO(MAN) income has created a pended auto reconciling entry. The ATO (MAN) income is valid. Estimate(s) reconciled using the ATO (MAN) income.

Legislation: <include one of the following>

Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent's actual adjusted taxable income - single election, or

Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent's actual adjusted taxable income - more than one election.

See Table 19, Step 2.

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the intray.
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add notepad:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002

Procedure ends here

Cuba will not auto-reconcile an estimate on receipt of a TRDB income for that year of income. A Pending Auto Reconciling INC intray is generated and a Pended Reconciling entry with the source ATO (TRDB) will display in the Client Income window.

Has an ATO (AUTO) income for the same year and for the same amount been used to reconcile the estimate?

• Yes:
• document the following in the pended reconciling entry notepad in the Client Income window
  Subject: TRDB income
  Text: A TRDB income has created a new pended auto reconciling entry. The estimate has been reconciled using the ATO (AUTO) income with a status of 'Currently Used'. TRDB associated Pended Reconciling entry deleted.'
• delete the pended reconciling entry
• procedure ends here
• No, if there is no ATO (AUTO) income for that year or the ATO (AUTO) income is for a different amount than the TRDB income, take no action for one week from the intray creation date. This will allow for ATO data to transfer to Cuba. Go to Step 2

Have ATO (AUTO) income details been receive after a week?

• Yes, and the estimate is auto reconciled
• Document the following in the TRDB pended reconciling entry notepad in the Client Income window:
  Subject: TRDB income
  Text: 'A TRDB income has created a new pended auto reconciling entry. The estimate has been reconciled using the ATO (AUTO) income with a status of ‘Currently Used’. TRDB associated Pended Reconciling entry deleted.'
• Delete the pended reconciling entry
• Procedure ends here
• No, go to Step 3

If an ATO (AUTO) income was not received within a week of the intray generating then use Integrated Core Processing (ICP) to check the income. Confirm lodgement and issue date and amount of the tax return is the same as the TRDB income.

Have income details been confirmed in ICP?

• Yes, ICP income details match TRDB income, go to Step 4
• No:
• There are no details in ICP for that year, go to Step 8
• Different details found in ICP, go to Step 9

Use Cuba to test if the estimate is to be reconciled:

• Open the pended reconciling entry
• From the Reconciling Estimate window select the Reconciliation Calculator
• Select Income/Deduction Details button
• Select OK to return to the Reconciliation Calculator
• Select Calculate
• Select OK in the Reconciliation Calculator window
• Save the pended reconciling entry

Check the result and determine if the estimate requires reconciliation.

If the actual ATI is:

• not higher than the expected ATI, the estimate does not need to be reconciled, go to Step 5
• higher than the expected ATI and the estimate:
• requires reconciliation, go to Step 6
• does not require reconciliation due to an unintended outcome, go to Step 7. E.g. a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated

If the actual ATI is not higher than the expected ATI, the estimate does not need to be reconciled:

• Add the following documents to the pended reconciling entry before deleting the entry:
  Subject: TRDB Est Rec No Change
  Text: 'A TRDB income has created a new pended auto reconciling entry. No ATO (AUTO) income has been received within the usual expected timeframe. ICP confirms lodgement, issue date and amount of the tax return as being the same as the TRDB income. Reconciliation of the estimate(s) is not required and the estimate has been set to Recon-No Change.
• Select the pended reconciling entry in the Client Income window and select delete from the File menu
• Select and open the associated estimate from the Client Income window
• Set the Reconciliation Status of the estimate to Recon-No Change in the Estimate Income window
• Document the following in a new notepad on the estimate:
  Subject: TRDB Est Rec No Change
  Text: Reconciliation resulted in no change to the assessment and the estimate has been set to Recon-No Change. Refer to deleted reconciling entry

Procedure ends here.

• Document the following in the reconciling entry notepad in the Client Income window:
  Subject: TRDB Est Rec
  Text: A TRDB income has created a new pended auto reconciling entry. No ATO (AUTO) income has been received within the usual expected timeframe. ICP confirms lodgement and issue date and amount of the tax return as being the same as the TRDB income. Estimate(s) reconciled using the TRDB income.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election or,
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.
• Select Save.
• See Table 19, Step 2.

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the intray.
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add a notepad to explain the unintended outcomes, for e.g.:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002.

Procedure ends here

If an ICP search does not confirm that a tax return was lodged and issued for the TRDB income year:

• document the following in the pended reconciling entry notepad in the Client Income window:
  Subject: TRDB income
  Text: 'A TRDB income has created a new pended auto reconciling entry. No ATO (AUTO) income has been received within the usual expected timeframe. ICP does not confirm the lodgement and issue date and amount of the tax return as being the same as the TRDB income. The estimate(s) will auto reconcile on receipt of an ATO (AUTO) income.'
• delete the pended reconciling entry

Note: escalate non-receipt of the ATO (AUTO) income to an SSO as a Cuba issue. See Technical support in Child Support.

If an ICP search confirms a return was lodged and issued but not received and the ATI amount is different to the TRDB income:

• document the following in the pended reconciling entry notepad in the Client Income window:
  Subject: TRDB income
  Text: 'A TRDB income has created a new pended auto reconciling entry. The ATO (AUTO) income has not been received within the usual expected timeframe. ICP identifies a different ATI compared to the TRDB income. The estimate(s) has not been reconciled using the TRDB income.'
• delete the pended reconciling entry

Note: escalate non-receipt of the ATO (NTS) income to an SSO as a Cuba issue. See Technical support in Child Support.

When the ATO load the customer’s tax return details into Integrated Core Processing (ICP), an income message is sent to Child Support and a ‘Taxable Income’ is recorded in Cuba which may be used in an assessment.

Sometimes the ATO make adjustments to the tax return after that first income is sent to Child Support, e,g,

• adding income that was not initially included, or
• cancelling the tax return

If the income is adjusted and re-processed, a second income message is sent to Child Support. An additional ‘Taxable Income’ (not an ‘Amended Taxable Income’) for the same financial year is loaded in Cuba, but may not be automatically used in the assessment.

Note: there can be more than 2 Taxable Income ATO(AUTO) entries for the same financial year.

The Taxable Income with a status of Currently Used or Recorded is normally the correct income, as it represents the adjusted amount as assessed by the ATO. The incorrect income/s will normally show as Cancelled in Cuba.

The Estimate Reconciliation teams will normally correct any affected reconciling incomes, by:

• deleting any reconciliation that used an income which is now cancelled, and
• considering re-reconciliation using a valid ATO income if there is one available

As the estimate/s for that year have previously been reconciled or had a status of Recon-No Change applied, a Pending Auto Reconciling Inc intray may generate on receipt of the second or later taxable income. An Estimate Rec intray will be manually created if needed.

Check the income history and confirm there is a Taxable Income ATO (AUTO) for the same financial year with a status of 'CANCEL SYSTEM' or ‘CANCEL USER’.

• If there is a currently used Reconciling entry, go to Step 3
• If the Estimate has a Reconciliation Status of Recon-No Change, go to Step 4

Delete the currently used reconciling income that was based on the now cancelled income. From the Client Income window:

• Select the Currently Used reconciling income from the Client Incomes list box
• Document the following in a notepad, update the text as required:
  Subject: Reconciliation deleted
  Text: The estimate reconciliation is being corrected to use the correct ATO income under the Error Correction Policy. The ATO income currently used in the estimate reconciliation is incorrect due. It was based on an income which was later adjusted or cancelled by the ATO
• Select the Currently Used reconciling income from the Client Incomes list box
• Select Delete from the File menu
• Select Yes to confirm

A Deletion may produce MIR1-1/1-2, MAC1-3/1-4 or NOA-01 letters.

Delete letters for both customers if not appropriate to issue.

If deleting the NOA-01, also delete letters in the Suppressed letters list.

See Letters Cuba Process Help.

In the Client Income window, check for a Reconciling income entry with a status of Pended.

Is there a Pended Reconciling entry based on the correct ATO Taxable income?

Note: to be correct, the Pended Reconciling entry must include the correct ATO Taxable income, and any other components that must be included in ATI for Child Support purposes.

• Yes, go to Step 5
• No, or if unsure - check which ATO Taxable income is the correct one to use and whether there are any other components that must be included in ATI. Seek SSO assistance if required. When the correct ATI has been confirmed, go to Step 6

From the Client Income window:

• select and open the pended reconciling entry
• from the Reconciling Estimate window select the Reconciliation Calculator
• select Income/Deduction Details button
• confirm that the correct Taxable income and any non-taxable income are recorded
• select OK to return to the Reconciliation Calculator
• select Calculate
• select OK
• save the Pended Reconciling entry, so the status remains Pended

Go to Step 7.

From the Client Income window, manually load the estimate reconciliation:

• select Reconcile Income from the Go menu, this will open the Reconciliation Period Selector
• select the relevant financial year for reconciliation and select OK. This will open the Details of Child Support Income/Allowable Deductions dialogue box
• remove any pre-populated entries by highlighting the entry, select Remove
• key the correct taxable income:
• Type: Income
• Description: Other Income
• Source: Aust Tax Office
• Title: MODIFIED TAXABLE INCOME AMOUNT
• Start Date: 01/07/yyyy
• End Date: 30/06/yyyy
• Amount: insert amount of correct ATO (AUTO) Taxable Income
• key DVA/Centrelink non-taxable income:
• Type: Income
• Description: Pensions Not Tax
• Source: Centrelink or DVA
• Title: NON TAXABLE PENSION OR BENEFIT
• Start Date: 01/07/yyyy
• End Date: 30/06/yyyy
• Amount: insert Non-Taxable amount
• select OK to return to the Reconciliation Calculator
• select Calculate
• select OK. This will open the Reconciling Estimate Income window
• select Error in the Created Reason
• select Pended from the Status dropdown menu, and Save

For more details see Table 3 in Estimates Cuba Process Help.

From the Client Income window:

• select and open the pended reconciling entry
• from the Reconciling Estimate window select the Reconciliation Calculator
• select Income/Deduction Details button
• confirm that the correct Taxable income and any non-taxable income are recorded
• select OK to return to the Reconciliation Calculator
• select Calculate
• select OK
• save the Pended Reconciling entry, so the status remains Pended

Check the result and determine if the estimate requires reconciliation.

If the actual ATI is:

• not higher than the expected ATI, the estimate does not need to be reconciled, go to Step 8
• higher than the expected ATI and the estimate requires reconciliation, go to Step 9
• higher but the estimate does not require reconciliation due to an unintended outcome, go to Step 10. E.g. a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated

As the ATI is the same or lower than the expected ATI:

• add the following notepad to the estimate and the Pended Reconciling entry. Update the text as required:
  Subject: Recon-No Change
  Text: The estimate was previously reconciled or set to recon-no change using the incorrect yyyy/yy ATO income (ATO has later adjusted or cancelled the income). The estimate’s accuracy is now checked using the correct ATI. As the Actual ATI $xxx is not higher than the expected ATI $xxx, the estimate does not require reconciling. Pended Reconciling entry has been deleted and the estimate remains as/has been set to Recon-No Change
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election
• delete the Pended Reconciling entry
• set the Reconciliation status of the estimate to Recon-No Change. The status may already be Recon-No Change based on the original reconciliation

Had the estimate previously been reconciled?

• Yes, see Table 19, Step 1
• No, procedure ends here

Does the estimate currently have a Reconciliation status of Recon-No Change?

• Yes, before accepting the pended reconciling entry, in the Client Income window:
• select and open the associated estimate
• update the status from Recon-No Change status to NONE
• add the following notepad to the Estimate:
  Subject: Recon–No Change set to NONE
  Text: Estimate Reconciliation Status had been set to Recon-No Change based on the incorrect ATO income. Estimate reconciliation will be recalculated based on the correct ATO income.
  This status has been changed to NONE as it is no longer accurate. Reconciliation is now required through manual intervention as the actual income is higher than the estimate for the year of income.
• Go to Step 11
• No, go to Step 11

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the intray
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add a notepad to explain the unintended outcome, for e.g.:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002

Procedure ends here.

Document the following in the pended reconciling entry notepad - update the text as required.

Subject: Estimate re-reconciled
Text: The estimate reconciliation has been corrected to use the correct yyy/yy ATO income under the Error Correction Policy. The ATO income used in the previous estimate reconciliation is incorrect due to an ATO data transfer error.

<Insert this paragraph if manually loading the Reconciliation Calculator> If the customer receives an ME4-3 letter, it states that Child Support has not received the customer’s taxable income from the ATO. If the customer questions this, explain an incorrect taxable income from the ATO was used as a basis for the reconciliation.
Legislation: <include one of the following>

Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election or,

Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.

From the Client Income window:

• select and open the Pended reconciling income
• from the Reconciling Estimate Income window select the Reconciliation Calculator
• select Income/Deduction Details button
• select OK to return to the Reconciliation Calculator
• select Calculate, then OK
• select Recorded from the Status dropdown menu
• select Save
• check the letters issued to the estimating and non - estimating parent. See Letters Cuba Process Help, View or preview a letter

See Table 19, Step 1.

In most cases, receipt of an ATO Amended Taxable income will create a:

• Pending Auto Reconciling Inc intray, or
• Reconciliation Required intray

Manual intervention is required to determine if the amended taxable income will be used to reconcile or re-reconcile an estimate.

In some cases, an intray will not automatically create. An internal referral may then be received via an 'Estimate Rec' intray. Check the intray notepad for details about the referral.

Note: the ATO ICP system may indicate that an ATO income has been, or will be, cancelled. The Solutions Gateway Team (SGT) will remove cancelled ATO incomes from Cuba after confirmation from the ATO. If an estimate was reconciled based on an ATO income that is now cancelled, the reconciling income must also be cancelled. If a valid ATI is available, consider if re-reconciliation is required. Follow the process for Correcting errors on Child Support cases.

Rules about the use of Amended Taxable Incomes in child support assessments changed on 23 May 2018. It is the Issue Date of the Amended Taxable income that determines which rules apply.

Check the ‘Issue Date’ of the Amended Taxable Income.

If the Issue Date is:

• before 23 May 2018, go to Step 3
• on or after 23 May 2018, go to Step 4

Note: for WA ex-nuptial cases, the ‘on or after 23 May 2018’ rules apply if;

• the issue date of the amended tax assessment is on or after 15 May 2019, or
• the issue date of the amended taxable income is between 23 May 2018 and 14 May 2019 and the notification date is on or after 15 May 2019

Note: most amended tax assessments issued before 23 May 2018 have been processed. However, there may be instances where an income with an older issue dates needs to be checked. For help consult an SSO.

If the amended ATO income issued before 23 May 2018 is the same as the previously used ATO income, go to Step 5.

If the amended ATO income issued before 23 May 2018 is different to the previously used ATO income, check if one of the conditions below is met:

• If the ATO issued an amended tax assessment before 23 May 2018 and the amendment was initiated on or after 1 July 2008, the amendment will only be used to re-reconcile an estimate when:
• the amendment was due to a reason set out in sub-section 56(2) of the Child Support (Assessment) Act 1989 (as it existed on 22 May 2018), or
• at the time the estimate of income is to be first reconciled, the amended taxable income is available to the Registrar. For e.g., the customer’s 2014 Taxable Income and Amended Taxable income both come across to Cuba from the ATO and the estimate is not yet reconciled. Reconcile the estimate, see Estimates Cuba Process Help, or
• the amended taxable income replaces an original ATO assessment of nil taxable income (and the other components were also nil), then the estimate will be re-reconciled using the amended taxable income
  For more details see Table 1, Step 9 in Australian Taxation Office (ATO) income for Child Support customers

If none of the above conditions are met for an income issued pre 23 May 2018, go to Step 9.

If at least one of the above conditions is met for an income issued pre 23 May 2018, go to Step 10.

For amended ATO incomes with an ‘Issue Date’ on or after 23 May 2018. If the amended ATO income is:

• the same as the income used in the previous reconciliation decision, go to Step 5
• different to the income used in the previous reconciliation decision (or if a decision was not made), go to Step 6

If ATO issues an amended taxable income and the amended ATI is equal to the previously used ATI, there will be no change to the current Reconciliation or Recon-No Change decision.

In the Client Income window:

• select the pended reconciling entry
• document the following in the pended reconciling entry notepad:
  Subject: ATO Amended Taxable
  Text: Notification of an ATO Amended Taxable Income has created a new pended reconciling income entry. The Amended ATI is the same as the previously notified ATI used to reconcile the estimate(s). No further action is required and this pended reconciling income entry has been deleted
• delete the pended reconciling entry. The intray will automatically delete

Procedure ends here.

If the ATI is different only because of a change to the Other Components amount, go to Step 7.

If the ATI is different and there is a change to the Taxable Income amount, go to Step 8.

If there is a change to the ‘other components’ of a customer’s ATI that does not affect the customer’s taxable income component, the amended ATI may potentially be used to re-reconcile the estimate. If the amended ATI is:

• higher than the original ATI, go to Step 10
• lower than the original ATI and the estimate is being used in a Child Support Period (CS Period) which ended less than 18 months ago, go to Step 10
• lower than the original ATI and the estimate is being used in a CS Period which ended more than 18 months ago: There may be an existing Correcting Errors submission re using an ATI with an Amended ‘Other Components’ income. Check the original correcting errors submission to see if consideration has already been given to re-reconciling the estimate with the lower amended ATI. If the submission does not include re-reconciliation of the estimate. Consider the reasons for the delay in receiving the amended ATI, the effect on the case and all parties to the assessment if the re-reconciliation was performed. If this information is not available, contact the customer. To determine why the customer was delayed in requesting their original ATI be amended:
• If not satisfied the delay is reasonable in the circumstances, then the lower amended ATI will not be used to re-reconcile the estimate. The customer has the option to object to the particulars of the assessment, go to Step 9
• If satisfied the delay is reasonable in the circumstances, then the lower amended ATI can potentially be used to re-reconcile the estimate, go to Step 10

For more details, see Table 1 in Australian Taxation Office (ATO) income for Child Support customers.

Amended tax assessments issued by ATO on or after 23 May 2018, may potentially be used to reconcile/re-reconcile an estimate if at least one of the following conditions is met:

• amended tax assessment results in an Adjusted Taxable Income (ATI) that is higher than the previous ATI, or
• amended tax assessment results in a ATI that is lower than the previous ATI and the amended tax return was lodged:
• on or before the parent’s tax return lodgement due date, or
• within 28 days of the Issue date of the parent’s previous ATO assessed income, or
• more than 28 days after Issue date of the parent’s previous ATO assessed income but within 28 days of the parent becoming aware of an error which was beyond their knowledge or control, or
• a decision has been made to use the lower income because special circumstances exist, see References for a link to the Child Support Guide 2.4.4.30 for more information about special circumstances

If none of the above conditions is met, go to Step 9.

If at least one of the above conditions is met, go to Step 10.

If the ATO issues an amended taxable income but no condition to use the amended ATI is met, the estimate will not be re-reconciled.

In the Client Income window:

• select the pended reconciling entry.
  If there is no pended reconciling entry, add a notepad to the original Estimate entry
• document the following in the pended reconciling entry notepad:
  Subject: ATO Amended Taxable
  Text: An ATO Amended Taxable Income has been received. The Amended ATI does not meet the conditions to be used in an assessment. No further action is required. Any pended reconciling income entries have been deleted.
  As prescribed by sub-section 56(2) and 56(2A) of the Child Support (Assessment) Act 1989.

If there was a pended reconciling entry in the Client Income window, select Delete from the File menu. The intray will automatically delete.

Procedure ends here.

Although a condition for potentially re-reconciling with the ATO Amended income has been met in Step 7 or 8, another check must be completed before continuing.

Determined incomes are used due to non-lodgement, i.e when no ATO income is available 12 months after the estimate year ends. Although the customer has now lodged tax returns, and the determined income may have been replaced, this check must still be done.

Has the estimate ever been reconciled using a determined income due to previous non-lodgement?

• Yes, and the Amended ATI is:
• lower than or equal to the determined income. The estimate cannot be re-reconciled using the amended ATI. An estimate reconciled with a determined income can only be re-reconciled using a higher actual income. However, if the amended ATI was lodged to correct an error by the customer or the ATO, an error corrections, is an option. The estimate could potentially return to being reconciled based on the determined income. If not, the estimate will remain reconciled based on the current reconciling income. Consult an SSO/PSM for assistance with this decision. Document using the following notepad on the Pended Reconciling income entry:
  Subject: Amended ATI received
  Text: ATO has issued an Amended Taxable income. The Estimate was originally reconciled using a determined income. When a determined income has been used to reconcile, the estimate cannot be re-reconciled using a lower ATI. The estimate will remain reconciled (or return to being reconciled) based on a reconciling income of $XXXX.
  (add any further details required to explain how the decision was made and the advice provided by SSO/PSM). As prescribed by sub-section 64(1)(d) or 64A(1)(d) of the Child Support (Assessment) Act 1989
  Go to Step 11
• higher than the determined income, go to Step 12
• No, go to Step 12

Based on the findings in Step 10, does the earlier reconciliation with the determined income need to be restored to correct an error?

• Yes:
• Delete any Pended reconciling incomes
• Delete the Currently Used reconciling income
• Manually re-key the determined income reconciliation details. Do not send an interim Estimate Reconciliation letter. Seek SSO support if needed
• Add a copy of the same notepad used above to explain the decision
• Save the Reconciling income as Recorded
• Check that the expected outcome has occurred
• Check that appropriate letters have issued
• Add and authorised correcting errors submission to explain the correction
• Go to Table 19 to contact the customers
• No:
• delete any Pended reconciling incomes
• procedure ends here

Check the estimate status/estimate reconciliation status in the Estimate income window.

What is the status?

• Recon-No Change, go to Step 13
• Reconciled, go to Step 17

Compare the expected ATI to the actual amended ATO ATI. In the Estimate Income window, select the Calculate button to calculate the total Expected Adjusted Taxable Income for the relevant tax year.

Is the actual amended ATI higher than the expected ATI?

• Yes, go to Step 14
• No, the estimate does not need to be reconciled and there will be no change to the Recon-No change status:
• Document the decision in a new notepad on the estimate
• If there is a pended reconciling income entry, also document on this entry before deleting the entry
  Subject: Recon-No Change
  Text: The yyyy/yy estimate was originally reconciled using the previous ATO ATI. The estimate’s accuracy is now checked using the amended ATI. As the Expected ATI $xxx is higher than the actual amended ATI $xxx the estimate does not require reconciling and the current Recon-No Change status is accurate.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.
  Note: if the actual case does not match the situation in this example documentation, seek help from an SSO to adapt the example notepad wording.
• Procedure ends here

In the Client Income window:

• select and open the associated estimate
• change the Recon–No Change status to NONE
• document the reason the Recon-No Change status is being changed, depending on the condition.
  For e.g., if the amendment issued on or after 23 May 2018 and the ATO amended taxable income meets the requirements for retrospective application set out in sub-section 56(2A) of the Child Support (Assessment) Act 1989.
  Subject: Recon-No Change set to NONE
  Text: Estimate Reconciliation Status had been set to Recon-No Change based on the previous ATI. Estimate reconciliation will now be recalculated based on the ATO amended income as per sub-section 56(2A) of the Child Support (Assessment) Act 1989.
  This status has been changed to NONE as it is no longer accurate. Reconciliation is now required through manual intervention as the actual income is higher than the estimate for the year of income.’

Note: if the actual case does not match the situation in this example documentation, seek help from an SSO to adapt the example notepad wording.

Go to Step 15.

From the Client Income window, is there a Pended Reconciling entry?

• Yes:
• select the Pended reconciling income from the Client Income list box
• from the Reconciling Estimate Income window, select the Reconciliation Calculator
• select Income/Deduction Details button and check that the correct income details display
• select OK to return to the Reconciliation Calculator
• select Calculate, to view the outcome if the reconciliation were to be saved
• go to Step 16
• No, manually load the estimate reconciliation:
• select Reconcile Income, from the Go menu. This will open the Reconciliation Period Selector
• select the relevant financial year for reconciliation, select OK. This opens the Details of Child Support Income/Allowable Deductions dialogue box
• remove any pre-populated entries, select the entry and select Remove
• add the correct amended modified taxable income
• add any DVA/Centrelink non-taxable income
• select OK to return to the Reconciliation Calculator
• select Calculate to view the outcome if the reconciliation were to be saved
• go to Step 16

Does the estimate require reconciliation?

• Yes: In the Reconciling Calculator window:
• select OK. his will open the Reconciling Estimate Income window
• select Error in the Created Reason
• select Recorded from the Status dropdown menu,. For more details, see Estimates Cuba Process Help
• document the reason the estimate is being reconciled using the amended income in the notepad
  For e.g., if the amendment issued on or after 23 May 2018 and the ATO amended taxable income meets the requirements for retrospective application set out in sub-section 56(2A) of the Child Support (Assessment) Act 1989
  Subject: Manual intervention - amended ATO.
  Text: Estimate had been reconciled based on the previous ATI. Estimate reconciliation has been recalculated using the ATO amended income which was amended as per sub section 56(2A) of the Child Support (Assessment) Act 1989
  Only insert the below paragraph if the estimate reconciliation was manually loaded.

If the customer received an ME4-3 letter, it states that Child Support has not received the customer’s taxable income from the ATO. If the customer questions this, explain the taxable income from the ATO was used as a basis for the reconciliation.
Legislation: <include one of the following>
Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election, or
Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.

Note: if the actual case does not match the situation in this example documentation, seek help from an SSO to adapt the example notepad wording.

• select Save
• the new Reconciling income should now show in the Client Income window
• the case liability rates should now reflect the reconciliation
• go to Table 19, Step 2

• No, go to Step 20

Where an estimate already has a status of reconciled, the currently used reconciling income must be deleted. This allows a re- reconciliation, based on the ATO Amended income, to be considered.

Note: re-reconciliation is to be completed the same day as deletion of the reconciling entry. If unsure, seek help before deleting the reconciling entry.

In the Client Income window:

• select the Currently Used reconciling income from the Client Incomes list box, document the following notepad
  Subject: Reconciliation deleted
  Text: Estimate to be re-reconciled using the Amended ATI.
• save the notepad
• select the Currently Used reconciling income from the Client Incomes list box
• select Delete from the File menu. Select the Yes button to confirm

Deletion may produce MIR1 - 1/1-2 and MAC1-3/1-4 or NOA-01 letters.

Delete letters for both customers if not appropriate to issue.

If deleting the NOA-01, also delete letters in the Suppressed letters list.

See Letters Cuba Process Help: delete a letter.

A new reconciliation is needed using the amended ATI. See Table 3 in Estimates Cuba Process Help.

From the Client income window:

Is there a Pended Reconciling entry?

• Yes:
• select the Pended reconciling income entry from the Client Income list box
• from the Reconciling Estimate Income window select the Reconciliation Calculator
• select Income/Deduction Details button, check that the correct income details display
• select OK to return to the Reconciliation Calculator
• select Calculate, and check the outcome for the re-reconciliation
• go to Step 19
• No, manually load the estimate reconciliation:
• select Reconcile Income from the Go menu. This will open the Reconciliation Period Selector
• select the relevant financial year for reconciliation, select OK. This will open the Details of Child Support Income/Allowable Deductions dialogue box
• remove any pre-populated entries by highlighting the entry and selecting Remove
• add the correct amended modified taxable income
• add any DVA/Centrelink non-taxable income
• select OK to return to the Reconciliation Calculator
• select Calculate and check the outcome for the reconciliation
• go to Step 19

Check the re-reconciliation test results and determine if the estimate requires reconciliation.

If the actual amended ATI is:

• not higher than the expected ATI, the estimate does not need to be reconciled, go to Step 20
• higher than the expected ATI and the estimate
• requires reconciliation, go to Step 21
• does not require reconciliation due to an unintended outcome, go to Step 22. E.g. a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated

If the actual amended ATI is not higher than the expected ATI, the estimate does not need to be reconciled:

• Add the following document to the pended reconciling entry before deleting the entry
  Subject: ATO Amended Recon-No Change
  Text: Estimate had been reconciled based on the previous ATI. Estimate reconciliation has been recalculated using the ATO amended income which meets the conditions per sub-section 56(2A) of the Child Support (Assessment) Act 1989. Based on this recalculation, the estimate does not require reconciling and the estimate will be set to Recon-No Change.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.

Delete the Pended Reconciling entry

• Select the associated estimate and open
• Set the Reconciliation status of the estimate to Recon-No Change in the Estimate window
• Document the following in a new notepad and Save
  Subject: Recon-No Change
  Text: The yyyy/yy estimate was originally reconciled using the previous ATO ATI. The estimate’s accuracy is now checked using the amended ATI. The estimate does not require reconciling and has been set to Recon-No Change.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election

Note: if the actual case does not match the situation in this example documentation, seek help from an SSO to adapt the example notepad wording.

Go to Table 19.

Document the reason the estimate is being reconciled using the amended income in the notepad.

For e.g., if the amendment issued on or after 23 May 2018 and meets the conditions set out in sub-section 56(2A) of the Child Support (Assessment) Act 1989.

Subject: Manual intervention - amended ATO.

Text: Estimate had been reconciled based on the previous ATI. Estimate reconciliation has been recalculated using the ATO amended income which meets the conditions was per sub-section 56(2A) of the Child Support (Assessment) Act 1989.

Only insert the below paragraph if the estimate reconciliation was manually loaded

If the customer receives an ME 4-3 letter it states that Child Support has not received the customer’s taxable income from the ATO.

If the customer questions this, explain the taxable income from the ATO was used as a basis for the reconciliation.

Legislation: <include one of the following>

Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election, or

Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.

Note: if the actual case does not match the situation in this example documentation, seek help from an SSO to adapt the example notepad wording.

• In the Reconciliation Estimate window, update the Status to Recorded
• Select Save

Go to Table 19.

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the intray.
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add a notepad to explain the unintended outcome, for e.g.:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002

Procedure ends here

If a CNLK/DVA – NON TAX income is received before the ATO (AUTO) income is received for that year, automatic estimate reconciliation will occur and include both amounts.

However, if a CNLK/DVA - NON TAX income is received after the ATO (AUTO) income is received for that year, the estimate reconciliation will have a status of Reconcile or Recon-no change. A Pending Auto Reconciling Inc intray will be created. Manual intervention is required.

Select from the following conditions:

• One pended reconciling entry and the associated estimate reconciliation status is currently Recon-No Change, go to Step 2
• Two reconciling entries (one entry is Pended, the second displays as Currently Used), go to Step 7

If a new CNLK/DVA – NON TAX income is received after a CNLK/DVA – NON TAX income has already been received for the same financial year, go to Table 11.

In this scenario, there is one reconciling entry pended in the Client Income window, the ATO (AUTO) income has been received and a check of the associated estimate shows a reconciliation status of Recon-No Change. As the new information increases the customer’s actual ATI, use Cuba to test the outcome of reconciliation.

From the Client income window:

• select and open the pended reconciling entry
• from the Reconciling Estimate window select the Reconciliation Calculator
• select Income/Deduction Details button
• confirm that the Taxable income and the amended Clink/DVA non-taxable income are recorded correctly
• select OK to return to the Reconciliation Calculator
• select Calculate
• select OK
• save the Pended Reconciling entry

Check the result and determine if the estimate requires reconciliation.

If the actual ATI is:

• not higher than the expected ATI, the estimate does not need to be reconciled, go to Step 3
• higher than the expected ATI and the estimate:
• requires reconciliation, go to Step 5
• does not require reconciliation due to an unintended outcome, go to Step 4. E.g. a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated - due to a Fixed Annual Rate (FAR) decreasing

If the actual ATI including the Centrelink/DVA Non Tax income is not higher than the expected ATI, the estimate does not need to be reconciled.

In the Client Income window, document the following in the associated estimate:

• Subject: Reconciling Status reviewed
  Text: Estimate has been reviewed on receipt of the CNLK (or DVA) – Non Tax income. As the expected ATI is higher than the actual ATI the estimate does not require reconciling and the current status of Recon–No Change is accurate
• Delete the pended reconciling entry. The intray will automatically delete

Procedure ends here.

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the intray
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add a notepad to explain the unintended outcome, for e.g.:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002

Procedure ends here

If the estimate requires reconciliation, in the Client Income window:

• select and open the associated estimate
• change the Recon-No Change status to NONE
• document the following:
  Subject: Recon-No Change set to NONE
  Text: Estimate has been reviewed on receipt of the CNLK (or DVA) - Non Tax income. On notification of the ATO (AUTO) Taxable Income, the estimate was checked and a reconciling status of Recon-No Change was set. This status has been changed to NONE as it is no longer accurate. Reconciliation is now required as the actual ATI is higher than the expected ATI

• In the Client Income window:
• select and open the pended reconciling entry
• change the Status from 'Pended' to 'Recorded'
• Document the following in the notepad:
  Subject: Clink (or DVA) Non-tax income.
  Text: Manual intervention was required to reconcile the estimate as the non-taxable Centrelink (or DVA) income component was received after the taxable income.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election or,
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election
• Select Save
• See Table 19, Step 1

If an estimate has been reconciled on receipt of the taxable income, the new Centrelink or DVA income information will create a second reconciling entry in the Client Income window. The first entry will have a status of CURRENTLY USED, the other PENDED.

In the Client Income window, select:

• currently Used reconciling income from the Client Incomes list box. Create a new note on the entry and add the following:
  Subject: Reconciliation deleted
  Text: Estimate to be re-reconciled as new Centrelink (or DVA) information received. Refer to the re-reconciliation notepad

Select:

• The Currently Used reconciling income from the Client Incomes list box
• Delete from the File menu
• Yes to confirm

Deletion may produce MIR1-1/1-2, MAC1-3/1-4 and NOA-01 letters.

Delete letters for both customers if not appropriate to issue.

If deleting the NOA-01, also delete letters in the Suppressed letters list

See Letters Cuba Process Help: delete a letter.

Select the Pended reconciling income from the Client Income list box to open it.

From the Reconciling Estimate Income window:

• Select the Reconciliation Calculator
• Select Income/Deduction Details button
• Confirm the Taxable income and the amended Clink/DVA non-taxable income are recorded correctly
• Select OK to return to the Reconciliation Calculator
• Select Calculate, then OK
• Select RECORDED from the Status dropdown menu,
• Document the following in a new notepad:
  Subject: Clink (or DVA) Non-Tax.
  Text: Manual intervention was required as the non-taxable Centrelink (or DVA) income component was received after the calculation of the ATI used to reconcile the estimate. The estimate has been re-reconciled to include the non-taxable Centrelink (or DVA) income in the ATI
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income – single election
  or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.
• Save the reconciliation

Go to Table 19.

In some cases, Centrelink (or DV) will notify of a new CNLK (or DVA) - NON TAX income. This is generally in response to reconciliation by Centrelink (or DVA) of the customer’s income or an error in the original notification by Centrelink (or DV). The new non-taxable income can be higher, lower or the same as the previously notified non-taxable income.

If Centrelink or DVA notify a new CNLK (or DVA) Non-taxable income after the ATO (AUTO) income has been received, a pended reconciling entry is created in the Client Income window. A CNLK (or DVA) - NON TAX entry will have a status of REPLACED and the new entry will have a status of CURRENTLY USED.

Select from the following conditions:

• one pended reconciling entry and the associated estimate reconciliation status is currently Recon-No Change, go to Step 2
• two reconciling entries (one entry is pended the second displays as Currently used), go to Step 7

In this scenario:

• there is one reconciling entry pended in the Client Income window
• the ATO (AUTO) income has been received, and
• a check of the associated estimate shows a reconciliation status of Recon-No Change

Use Cuba to check the outcome reconciliation.

From the Client Income window:

• select and open the pended reconciling entry
• from the Reconciling Estimate window select the Reconciliation Calculator
• select Income/Deduction Details button
• confirm that the Taxable income and the amended Clink/DVA non-taxable income are recorded correctly
• select OK to return to the Reconciliation Calculator
• select Calculate
• select OK
• save the Pended Reconciling entry

Check the result and determine if the estimate requires reconciliation.

If the actual ATI is:

• not higher than the expected ATI, the estimate does not need to be reconciled, go to Step 3
• higher than the expected ATI and the estimate:
• requires reconciliation, go to Step 5
• does not require reconciliation due to an unintended outcome, go to Step 4. E.g. a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated

If the new actual ATI is not higher than the expected ATI, the estimate does not need to be reconciled.

In the Client Income window:

• document the following on the pended reconciling entry and the associated estimate:
  Subject: Reconciling Status reviewed
  Text: Estimate has been reviewed on receipt of a new CNLK (or DVA) - Non Tax income. As the expected ATI is higher than the actual ATI the estimate does not require reconciling and the current status of Recon-No Change is accurate.
• delete the pended reconciling entry. The intray will automatically delete

Procedure ends here.

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the intray
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add a notepad to explain the unintended outcome, for e.g.:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002

Procedure ends here

In the Client Income window, select and open the associated estimate:

• Change the Recon-No Change status to NONE
• Document the following:

Subject: Recon-No Change set to NONE

Text: Estimate has been reviewed on receipt of a new CNLK (or DVA) - Non Tax income. On notification of the ATO (AUTO) Taxable Income the estimate was checked and a reconciling status of Recon-No Change was set. This status has been changed to NONE as it is no longer accurate. Reconciliation is now required as the actual ATI is higher than the estimated ATI.

In the Client Income window

• select the pended reconciling entry and open
• if authorised to reconcile, change the Status from 'Pended' to 'Recorded'
• document the following:
  Subject: New CNLK (or DVA)-Non Tax
  Text: Manual intervention was required to re-reconcile the estimate as Clink (or DVA) provided a new non-taxable Centrelink (or DVA) income component.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election,
  or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.
• Save the reconciliation

Go to Table 19.

If an estimate has been reconciled on receipt of the taxable income, the new Centrelink or DVA income information will create a second reconciling entry in the Client Income window. The first entry will have a status of CURRENTLY USED, the other PENDED.

Check the income

If the new non-taxable income is for a different amount to the previously notified non-taxable income the estimate will need to be re-reconciled. Go to Step 8.

If the new non-taxable income is for the same as the previously notified non-taxable income there will be no change to the current Reconciliation.

In the Client Income window:

• document the following in the pended reconciling entry:
  Subject: New CNLK (or DVA)-Non Tax
  Text: Notification of a new CNLK (or DVA) - Non Tax amount created a new pended reconciling income entry. The new CNLK (or DVA) - Non Tax amount is the same as the previously notified CNLK (or DVA) - Non taxable amount used to reconcile the estimate(s). No further action is required and the pended reconciling entry has been deleted.
• delete the pended reconciling entry. The intray will automatically delete

Procedure ends here.

In the Client Income window:

• select the Currently Used reconciling income from the Client Incomes list box. Create a new note on the entry, document the following:
  Subject: Reconciliation deleted
  Text: Estimate to be re-reconciled as a new Centrelink (or DVA) information received. Refer to the re-reconciliation notepad.

Select:

• the Currently Used reconciling income from the Client Incomes list box
• Delete from the File menu
• the Yes button to confirm

Deletion may produce MIR1-1/1-2, MAC1-3/1-4 and NOA-01 letters.

Delete letters for both customers if not appropriate to issue.

If deleting the NOA-01, also delete letters in the Suppressed letters list.

See Letters Cuba Process Help.

• Select the Pended reconciling income from the Client Income list box to open it
• From the Reconciling Estimate Income window select the Reconciliation Calculator
• Select Income/Deduction Details button
• Confirm that the Taxable income and the amended Clink/DVA non-taxable income are recorded correctly
• Select OK to return to the Reconciliation Calculator
• Select Calculate, then OK
• Select RECORDED from the Status dropdown menu
• Document the following in a new notepad:
  Subject: New CNLK (or DVA)-Non Tax
  Text: Manual intervention was required to re-reconcile the estimate as Clink (or DVA) provided a new non-taxable Centrelink (or DVA) income component.
  Legislation: <include one of the following>

Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election or,
Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.

• Save the reconciliation

Go to Table 19.

Child Support may amend an estimate used in an assessment in response to information that a customer’s income election (estimate) is no longer accurate and the customer has not advised Child Support and/or declines to make a subsequent estimate election to reflect the change in their circumstances. See Child Support estimates review (Post 1 July 2010).

Child Support Amended estimates will show as a 'CSA AMENDED EST' in the Client Income window.

An estimate will not automatically reconcile if there is a CSA Amended Estimate in a financial year. A Reconciliation Required intray will automatically create when the taxable income is available from the ATO.

Compare the expected ATI to the actual ATI. In the Estimate Income window select the Calculate button to calculate the total expected ATI for the relevant tax year.

Check the result and determine if the estimate requires reconciliation.

If the actual ATI is:

• not higher than the expected ATI, go to Step 3
• higher than the expected ATI and the estimate:
• requires reconciliation, manually reconcile the estimate. Go to Step 2
• does not require reconciliation due to an unintended outcome, go to Step 4. E.g. a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated

Load the actual ATI details (ATO income information and any non-tax income component information) into the Estimate Reconciliation calculator and pend the entry. See Estimates Cuba Process Help.

• Document the following in a notepad on the pended reconciling entry:
  Subject: CS Amend Est - manual reconciliation
  Text: Examination identifies that manual intervention is required to support the reconciliation of the yyyy/yy estimate(s).
  If the customer receives an ME4-3 letter, it states they have not lodged tax returns. If the customer questions this explain the taxable income from the ATO was used as the basis for the reconciliation.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election or,
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.
• Update the status of the pending reconciling entry to RECORDED, then Save
• Manually delete the Reconciliation Required intray, see Intray management Cuba Process Help

Go to Table 19, Step 2.

Check the Child Support amended estimate/s. Consider:

• was the decision to amend the estimate reasonable based on the information we had at the time
• has the income information been accurately applied when amending the estimate. Refer to the notepad/s and the data entered in the Estimate Component Details on the amended estimate

See Child Support estimates review (Post 1 July 2010).

If it is identified the income information was not correctly applied or the decision and basis of the amendment appears incorrect then seek help from an SSO.

If an error has occurred, follow the procedure for Correcting errors on Child Support cases. The income used to amend the estimate may need to be removed or changed.

If the income information was correctly applied:

• Set the Reconciliation Status of the estimate to Recon-No Change
• In the Estimate Income window add the following notepad:
  Subject: Recon-No Change
  Text: Child Support amended estimates checked and the income information was correctly applied. Examination identifies that reconciliation is not required.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.
• Delete the Reconciliation Required intray

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the intray.
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add a notepad to explain the unintended outcome, for e.g.:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002

Procedure ends here.

Estimates will not automatically reconcile where there is a deceased customer indicator. The indicator is on the front screen of either the estimating or non-estimating customer. The indicator may relate to a deceased parent, non-parent carer or child.

The incomes of both parents are required to be up to date. This will allow the Deceased Customer Management team (DCM) to finalise their management of the case.

The legislative requirement to reconcile the estimates of deceased parents and parents in cases where another person is deceased, is the same as it is for any other customer.

Estimate reconciliations can be initiated by:

• Mainstream Estimate Reconciliation teams, go to Step 2
• DCM teams, go to Step 3

There are 2 scenarios where a Mainstream Estimate Reconciliation team may initiate an estimate reconciliation for a parent in a case with a deceased customer indicator:

• If a parent, or executor on behalf of a parent, lodges taxable income through the ATO:
• This automatically creates a Pending Auto Reconciling Inc or a Reconciliation Required intray
• These intrays will be routed to a Mainstream Estimate Reconciliation team. The team will commence the process to check and potentially reconcile the estimate
• If a Mainstream Estimate Reconciliation team have identified a customer whose estimate can be manually reconciled:
• This may occur due to no actual ATO income details being available 12 months after the end of the financial year
• The Mainstream Estimate Reconciliation Service Officer may determine a reconciling income and pend it. This creates a Pending Reconciling Income intray

Go to Step 4.

DCM staff are required to request reconciliation of unreconciled estimates for a case after proof of death has been confirmed for a customer of the case.

Before a Non Pursuit of Debt (NPOD), Obsolete debt or Waiver can be considered, all incomes for a case must be up to date. This includes any estimates that are not yet reconciled.

DCM staff must follow the requirements in the Deceased Child Support Customer Management. If a DCM Service Officer has concerns about a potential estimate reconciliation, they must consult the DCM SSO.

When DCM identify an estimate that is required to be manually reconciled, the DCM Service Officer:

• create an Estimate Rec intray, and
• route it to the Specialised Assessments allocation position for action. See Estimate Reconciliations

Note: if no ATO tax assessment has been received for the estimating parent, the estimate cannot be reconciled until at least 12 months after the financial year ends. An estimate review can be completed by the DCM officer before that 12 month point if needed. See Child Support estimates review (Post 1 July 2010).

Legislatively the accuracy of all estimates must be checked and the estimates reconciled if needed.

The Service Officer with the estimate reconciliation skill set is responsible for the estimate reconciliation only. The DCM Service Officer is responsible for customer contact and ongoing management of this case.

Note: a pending Tax Refund Intercept Process (TRIP) must be actioned by DCM only. DCM will liaise with Specialised Assessments Services to determine whether the estimate can be reconciled before actioning the TRIP.

Mainstream Estimate Reconciliation Service Officer, go to Step 5.

DCM Service Officer, go to Step 8.

Service Officers with the estimate reconciliation skill set:

• check the accuracy of the:
• year to date (YTD) amount. Update the YTD if needed before reconciling the estimate
• estimate using the Reconciliation Calculator
• select Calculate in the Reconciliation Calculator dialogue box and save the calculation as Pended

Check the pended reconciliation calculation and determine if the estimate requires reconciliation.

Is the actual ATI higher than the estimated ATI?

• Yes, and there is
• no change to the assessment. Reconciliation is not required. Go to Step 6
• an expected change to the assessment and reconciliation is required. Go to Step 7
• an expected change to the assessment and reconciliation is not required due to an unintended outcome, go to Step 8. E.g. a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated
• No, reconciliation is not required. Go to Step 6

Where an estimate reconciliation is not needed or will result in no change to the assessed annual rate.

The Service Officer with the estimate reconciliation skill set will:

• create a note for the pended reconciling entry and document:
  Subject: Recon-No Change
  Text: Reconciliation resulted in no change to the assessment.
  Pended reconciling entry has been deleted.
  Estimate has been set to Recon-No Change.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election
  or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.
• delete the pended reconciling entry
• select and open the associated estimate and set the Reconciliation Status to Recon-No Change
  Add a note to the estimate and document:
  Subject: Recon-No Change decision
  Text: Pending Auto Reconciliation (document if referred by DCM).
  Reconciliation resulted in no change to the assessment.
  Refer to deleted pended reconciliation.
  Estimate has been set to Recon-No Change.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election
  or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.

If DCM referred the estimate for checking:

• delete the Estimate Rec intray, and
• create a DCM review required intray

If the customer is:

• locked to DCM - route the intray to the owning DCM officer
• not locked - route intray to:
  Office: NATIONAL OFFICE
  Stream/Team: MC SMCN NATIONAL MCS
  Position: A - DCM NATIONAL
  Suggested intray notepad text:
  Subject: Est Rec Outcome-No Change
  Text: Estimate has been checked by MS Est Rec SO and reconciliation is not required. Estimate has been set to Recon-No Change. No further action is required re this estimate.

Procedure ends here.

If an estimate reconciliation is needed that results in a change to the assessment.

The Service Officer with the estimate reconciliation skill set will:

• pend the reconciliation
• create a DCM review required intray
• add a note to the intray
  Suggested intray notepad text:
  Subject: Est Rec Outcome-No Change
  Text: Estimate reconciliation will create $XXX debt/overpayment and $XXX estimate penalties
  DCM officer - Please use this intray to advise:
  if a Service Officer needs to contact the customer, and
  when the reconciliation can be finalised
• if the customer is:
• locked to a DCM officer - route to the owning DCM Officer
• if not locked - route intray to:
  Office: NATIONAL OFFICE
  Stream/Team: MC SMCN NATIONAL MCS
  Position: A - DCM NATIONAL
• add a note to the pended reconciling entry
  Subject: Awaiting DCM response
  Text: DCM has been advised of outcome of the pended reconciliation. Document the outcome included any debt and penalties. Waiting on DCM response before finalising

Service Officers with the estimate reconciliation skill set will:

• await response to intray from DCM, go to Step 13
• DCM Service Officer, go to Step 9.

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the intray.
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add a notepad to explain the unintended outcomes, for e.g.:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002

Procedure ends here

DCM Service Officer check the notepad on the DCM Review Required intray.

If the Mainstream Estimate Reconciliation Service Officer has:

• finalised the estimate as a Recon No Change:
• no more action is needed to reconcile the estimate
• delete the DCM Review Required intray
• procedure ends here
• indicated that reconciliation is required, go to Step 10

If an estimate has been identified for reconciliation, the DCM Service Officer to:

• lock the customer. See Customer Management Approach (CMA) process
• review the case

There are limited circumstances where outstanding estimates are not reconciled. The DCM Service Officer will set any unreconciled estimates to Recon-No Change if all the following criteria is met:

• where the estimating payer is deceased and died intestate (without a will), and
• DCM have determined there is no collection avenue now or ever likely to arise, and
• DCM have advised the payee that unless they request reconciliation, the deceased payer’s estimates may not be reconciled, and
• the payee has indicated they do not want the intestate payer’s estimate reconciled

Where the payee cannot be contacted, 3 calls to all available numbers at different times of day over 48 hours will satisfy the phone contact requirement.

If phone contact is unsuccessful send a ‘please contact’ letter (CAL). Include that if Child Support does not hear from the payee there may be delays in:

• reviewing the income used for the payer, and
• finalising the details of the case

Allow the customer time to respond. See Standard response times.

If the DCM Service Officer has identified other circumstances where they have concerns about proceeding with an estimate reconciliation, they must consult with the DCM SSO.

If the DCM Service Officer:

• has DCM approval for a Recon-No Change, go to Step 11
• in other instances, go to Step 12

If the DCM officer has DCM approval for a Recon-No Change, the DCM officer will:

• go to the Client Income window
• select the pended reconciling entry and open
• document the following in the pended reconciling entry
  Subject: DCM Est Rec No Change
  Text: The estimate meets guidelines for Recon-No change, as set out in the Operational Blueprint ‘Manual reconciliation procedure for child support estimates’. Step 10. The estimate has been set to Recon-No Change.
• delete the pended reconciling entry
• select the associated estimate income from the Client Income window and open
• in the Estimate Income window, set the Reconciliation Status of the estimate to Recon-No Change
• document the following in a new notepad
  Subject: DCM Est Rec No Change
  Text: The estimate meets guidelines for Recon-No change as set out in the Operational Blueprint ‘‘Manual reconciliation procedure for child support estimates’. Step 10. The estimate has been set to Recon-No Change.
• return to the Estimate Income window and press Save
• delete the DCM Review Required intray

Procedure ends here.

When the DCM officer has received a DCM Review Required intray and estimate reconciliation is required, the DCM Service Officer will:

• make appropriate customer contact
• create a new note for the pended reconciling entry
  Subject: DCM review of estimate
  Document if customer contact has occurred and when the reconciliation can be finalised
• copy and paste the same notepad in to the DCM Review Required intray
• route the DCM Review Required intray back to the Estimate Reconciliation Service Officer who created the intray

Go to Step 13.

Estimate Reconciliation Service Officer will:

• check the response from DCM in the DCM Review Required intray
• finalise the reconciliation no earlier than the date indicated by the DCM officer
• check and send customer letters

DCM Service Officer will then:

• manage any ongoing issues, including debt

This exception occurs where an initial or amended estimate results in a FAR assessment and a subsequent estimate is lodged for a higher income, which results in an assessment less than FAR. The DON is correctly used as the start date of the subsequent estimate, even though there may be an earlier DOE.

On receipt of the relevant taxable income from the ATO, the expected adjusted taxable income (ATI) is calculated using DON to differentiate between each estimate period.

If there is an earlier DOE, the expected ATI must be calculated from the DOE as this is when the customer’s income increased.

An estimate will not automatically reconcile if there is a FAR DOE v DON exception. A Reconciliation Required intray will automatically create when the taxable income is available from the ATO:

• Check the effective date of the Reconciliation Required intray and find the related ATO Taxable Income and estimates in the Client Income window
• Identify the initial or amended estimate that resulted in a FAR assessment and the subsequent higher Client Amended Estimate that resulted in an assessment less than FAR. Note: there may be more than one occurrence in the financial year
• Open the Client Amended Estimate. The DOE should be earlier than the DON. Check the case liability rates to confirm the previous estimate resulted in an assessment of FAR and the higher subsequent estimate resulted in an assessment of less than FAR
• Route the Reconciliation Required intray to the Cuba ‘A - FAR DOE VS DON’ position in your team. The intray will be managed by a Service Officer trained in this work type
• Compare the parent’s expected ATI to the actual ATI. In the Estimate Income window, select the Calculate button to calculate the total expected ATI for the relevant tax year

Is the actual ATI income higher than the expected ATI?

• Yes, go to Step 2
• No, the estimate does not require reconciliation:
• set the Reconciliation Status of the estimate to Recon-No Change in the Estimate Income window
• document the following in a notepad on the estimate
  Subject: Recon-no change
  Text: FAR DOE v DON exception requiring manual intervention. The Expected ATI is higher than the actual ATI therefore reconciliation of the estimate is not required. The estimate has been set to Recon-No Change accordingly.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election, or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.
• delete the Reconciliation Required intray
• procedure ends here

It is not possible to adjust the Expected ATI in Cuba.

A workaround is required to take the additional Expected ATI into account.

• Subtract the additional Expected ATI from the actual ATI
• Use this reduced actual ATI to manually reconcile the estimate

Use the FAR DOE V DON spreadsheet on Resources to determine the accurate expected ATI.

Note: there may be more than one period where FAR DOE V DON applies.

After completing the calculation in the FAR DOE V DON spreadsheet, is the Actual ATI from column J higher than the correct expected ATI in column I?

• Yes:
• reconcile the estimate unless this will result in an unintended outcome to the assessment (a decrease for estimating parents in the role of PP / an increase for estimating parents in the role of RP)
• Go to Step 3
• No:
• set the Reconciliation Status of the estimate to Recon-No Change in the Estimate Income window
• document the following in a notepad on the estimate
  Subject: Recon-no change
  Text: FAR DOE v DON exception requiring manual intervention. When calculating the expected ATI to verify the accuracy of the estimate, the annual income of $xxx.xx was applied to the period dd/mm/yyyy (DOE) to dd/mm/yyyy (day before the DON). The annual income advised by the customer for this period at the time of lodging the estimate was $xxx.xx. We have recalculated the expected ATI for this period using this income.
  Add the simple calculation as per the example document.
  The correct Expected ATI $ is higher than the actual ATI $ therefore reconciliation of the estimate is not required. The estimate has been set to Recon-No Change.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election
  or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.

Procedure ends here.

It is not possible to adjust the Expected ATI in Cuba, therefore an adjustment is made to the ATI used to reconcile the estimate.

The actual ATI is reduced by the amount calculated as the additional Expected ATI. This reduced ATI is used to reconcile the estimate.

All calculations are performed in the FAR DOE V DON spreadsheet located on the Resources page.

• Manually load and pend the estimate reconciliation:
• select Reconcile Income from the Go menu. This will open the Reconciliation Period Selector
• select the relevant financial year for reconciliation and select OK. This will open the Details of Child Support Income/Allowable Deductions dialogue box
• remove any pre-populated entries by highlighting the entry, select Remove
• add the reduced ATI amount calculated on spreadsheet in Column K
• select OK to return to the Reconciliation Calculator
• select Calculate, and select OK, to return to the Reconciling Estimate Income window
• select Error as the Created Reason
• select Pended from the Status dropdown menu and Save
• select OK to return to the Reconciliation Calculator
• Check the result, and determine if the estimate requires reconciliation

Does the estimate require reconciliation?

• Yes, the reduced actual ATI is higher than the estimated ATI and the outcome is as expected. The estimate requires reconciliation. Go to Step 4
• No, the reduced actual ATI is higher than the estimated ATI but there is an unintended outcome. Go to Step 5 E.g. a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated

From the Reconciliation Calculator:

• select OK This will open the Reconciling Estimate Income window
• select Recorded from the Status dropdown menu
  For more about manually loading estimate reconciliations, see Estimates Cuba Process Help

The letter will reflect the reduced ATI used in the reconciliation and not the actual ATI as advised by the ATO. This may be confusing for some customers. Use the approved documentation to explain the process.

• Document the following in the reconciling entry:
  Subject: Adjusted ATI for reconciliation
  Text: When calculating the expected ATI to verify the accuracy of the estimate, the annual income of $xxx.xx was applied to the period dd/mm/yyyy (DOE) to dd/mm/yyyy (day before the DON). The annual income advised by the customer for this period at the time of lodging the estimate was $xxx.xx. We have recalculated the expected ATI for this period using this income.
  Manual intervention was required to give effect to the recalculated expected ATI in the reconciliation. The Modified Taxable Income used to reconcile the estimate is the Taxable Income from the ATO less the additional income which should have been included in the expected ATI.
  Add the simple calculation as per the ‘FAR DOE v DON exception on the Resources page
  If the customer receives an ME4-3 letter, it states that Child Support has not received the customer’s taxable income from the ATO. If the customer questions this, explain the taxable income from the ATO was used as a basis for the reconciliation.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election
  or
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election
• Delete the Reconciliation Required intray
• See Example of scenarios and documentation in ‘FAR DOE v DON exception’ located on the Resources page

Go to Table 19

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the pended reconciliation intray
• Manually delete the Reconciliation Required intray
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add a notepad to explain the unintended outcome, for e.g.:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002

Procedure ends here.

If a customer’s actual ATI is not available 12 months after the end of a financial year in which the customer lodged an estimate, the estimate period may be reconciled using a determined ATI.

A determined ATI cannot be used to reconcile an estimate earlier than 12 months after the end of the financial year of the estimate.

A determined ATI is compiled from information gathered from the customer, any third party or Child Support/ATO computer systems.

Make sure all relevant estimates within the relevant financial year have been processed correctly, including clear documentation reflecting the customer’s circumstances at the time of making the estimate. If there has been an error, see Correcting errors on Child Support cases when considering the decision.

Note: be alert to other issues that may affect reconciling the estimate. There may be other reasons for manual intervention.

Examples

• If there is a Deceased Customer indicator, consultation with the Deceased Customer Management team (DCM) is required. See Table 13
• If an Income Amount Order (IAO) is in place for one day or more in the estimate period an estimate cannot be reconciled, however it can be reviewed. If there is an IAO, see the Table 2
• For a list of manual intervention reasons, see Table 1, Step 7

Check the Client Income window.

Look for any actual ATO incomes for the financial year of the estimate. An ATO income may have been lodged or received after the intray was created.

Is an actual ATO income now available?

• Yes, a determined income is no longer required
• Manually reconcile the estimate using the actual ATO income. See Estimates Cuba Process Help
• Add a notepad stating that the estimate has been reconciled or set to Recon No Change using the actual ATO income. Include a reference to Section 64-64AA Child Support (Assessment) Act 1989
• Procedure ends here
• No, a determined income is required. Go to Step 3

Read the estimate notepad/s and the data in the estimate calculators. This provides information on the estimate and YTD incomes, their sources, dates, deductions and the expected ATI.

ITD Incomes

An ITD income is an ATI declared by the customer. ITDs must not be the sole source of information used for a determined income. The ITD must be confirmed as accurate by checking other sources.

Gather information from other sources such as:

• ATO data, e.g., Transaction Searching Facility (TSF), Integrated Core Processing (ICP)
• For help with:
• payment summaries in TSF, including lump sums, see the Guide to understanding payment summaries table on the Resource in Derived income for child support customers
• DVA payments, see Direct requests for information from Department of Veterans Affairs' (DVA)
• previous tax return information that reveals secondary sources of income, e.g., rental property income, business income, partnership/trust income
• documentation of relevant discussions with the customer during the year about their estimate or any review of the estimate/s under ss63A, 63B or 63C
• payslips or other documents provided by the customer about their income
• s161 or s162A (for international customers) notice responses
• responses to s120 notices

Note: an s120 notice cannot be issued to gather information regarding income, however if issued due to another reason, the response may provide information

• any post separation income applications
• Change of Assessment (COA) applications, responses or decisions (whether they depart from the assessment or not)
• documentation of Capacity to Pay (CTP) investigations
• Asset Liability Forms (ALF) or other forms containing income information
• court documentation which includes financial information
• Centrelink records indicating periods of unemployment and/or incarceration

Payments (lump sum or ongoing) under the National Disability Insurance Scheme (NDIS), National Redress Scheme, Territories Stolen Generations Redress Scheme or withdrawals under the First Home Super Save (FHSS) scheme are not counted as income for Child Support purposes. They cannot be included in Estimate Reconciliations.

Is there enough information available to determine the ATI?

• Yes, go to Step 4
• No, see Table 16

Check the YTD

Undertake a quick check of the YTD provided against the income information gathered and determine a new YTD if appropriate.

Contact with the customer generally is not required. It must be obvious the YTD is incorrect, e.g., the customer’s current YTD income details are from 2 employers however, TSF data shows an additional employer income in the YTD period.

If a new YTD is determined, issue the ME7-1 letter, see Table 7 in Child support estimates.

Manually load the estimate reconciliation

Where there is sufficient income information available to determine the ATI amount, record all relevant information about the customer's income for the financial year in the estimate reconciliation calculator and save the pended reconciling entry. See Steps to reconciling an estimate with a determined ATI in Estimates Cuba Process Help. Determine if there has been a change to the assessment or not.

Was there a change to the assessment?

• Yes, determine if the estimate needs reconciliation, If the estimate:
• requires reconciliation, go to Step 5
• does not require reconciliation due to an unintended outcome, go to Step 6. E.g. a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated - due to a Fixed Annual Rate (FAR) decreasing
• No, go to Step 8

If reconciliation will result in a change to the assessment, issue the ME4-4 Advise Pyr/Pye of their pended estimate reconciliation letter inviting the estimating customer to confirm their income details for the year.

Document the following in the pended reconciling entry in the Client Income window:

• Subject: Estimate Reconciliation

Text: yyyy/yy tax return not lodged

Reconciliation using a determined Adjusted Taxable Income (ATI).

Examination identified that the determined ATI is higher than the expected ATI.

ME4-4 Letter sent advising of Pended Reconciliation.

• If customer contacts confirm:
• pended reconciliation information including deductions
• YTD
• Tell the customer of their responsibility to lodge their Tax Returns
• If the customer lodges their ATO tax return at a later date re-reconciliation may occur.
  Section 64AB, Child Support (Assessment) Act 1989
  <insert the appropriate legislative reference below>
  Section 64AC, Child Support (Assessment) Act 1989
  or
  Section 64AD, Child Support (Assessment) Act 1989'

If the customer does not respond within an appropriate timeframe, the reconciliation will be finalised using the determined income.

Allow the customer time to respond. See Standard response times.

Add a document accepting the pended reconciling entry.

Note: the customer can object to the use of the determined ATI in the reconciliation.

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the pended reconciliation intray
• Manually delete the Reconciliation Required intray
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add a notepad to explain the unintended outcome, for e.g.:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002

Procedure ends here

If the reconciliation results in no change to the assessment:

• document the following in the pended reconciling entry in the Client Income window:
  Subject: Recon-No Change Decision
  Text: yyyy/yy tax return not lodged.
  Reconciliation using a determined Adjusted Taxable Income (ATI).
  Examination identifies reconciliation will result in no change to the assessment.
  Estimate set to recon-no change accordingly.
  Pended Reconciliation entry deleted.
  If the customer lodges their tax return at a later date re-reconciliation may occur.
  Section 64AB, Child Support (Assessment) Act 1989
  Legislation:<insert the appropriate legislative reference below>
  Section 64AC, Child Support (Assessment) Act 1989, or
  Section 64AD, Child Support (Assessment) Act 1989'
• delete the pended reconciling entry
• select the relevant estimate in the Client Income window and open
• set the Reconciliation Status of the estimate to Recon-No Change in the Estimate Income window
• add the following document to the notepad:
  Subject: Recon-No Change Decision
  Text: yyyy/yy tax return not lodged.
  Reconciliation using a determined Adjusted Taxable Income (ATI).
  Examination identifies reconciliation will result in no change to the assessment.
  Estimate set to recon-no change accordingly.
  Pended Reconciliation entry deleted (refer income history).
  If the customer lodges their tax return at a later date re-reconciliation may occur.
  Section 64AB, Child Support (Assessment) Act 1989
  Legislation: <add the appropriate legislative reference>
  Section 64AC, Child Support (Assessment) Act 1989, or
  Section 64AD, Child Support (Assessment) Act 1989

Document the information gathered about the customer’s income for the financial year in a notepad on the Estimate Income window. Do not record the information in the estimate reconciliation calculator until you have sufficient information.

There will be some cases where income information is not available to determine an ATI for reconciling an estimate.

Examples

A customer lodges a nil estimate advising they:

• have ceased work and will be supported by their partner, or
• are incarcerated and not receiving any more than the basic amenity allowance

If a review of the estimate and estimate notepad supports a nil income, change Reconciliation Status of the estimate to Recon-No Change. Document the decision.

Otherwise, go to Step 2.

Where there is insufficient information available to determine an ATI and a review of the estimate does not support a nil income, contact the estimating customer. Tell them that as a tax return has not been lodged an income needs to be determined to reconcile the estimate(s).

Where appropriate, send a pre-call SMS notification before calling. If customer does not respond to phone contact, send a CAL with the pre-approved text. See Table Step 4 in the Table 4, Step 2 in Letters Cuba Process Help.

Ask the customer for:

• confirmation that their year to date (YTD) income amount was accurate
• the income received during the application period of their estimate(s) including any allowable deductions
• supporting evidence including:
• payslips
• payment summaries
• a letter from their employer/s, or
• a letter from their accountant

Confirm the YTD figure used in the estimate. The customer is not able to object to the YTD figure after the estimate is reconciled, so it is important they are satisfied it is correct at this point.

Where the customer provides income information, use that information to determine the reconciling income (augmented by any other income information available). See Table 15, Step 3.

Where contact is unsuccessful or there is insufficient information to make a decision set the Reconciliation Status of the estimate to PARKED. The status of PARKED must only be applied if after a full investigation of a customer’s income, there is insufficient information to determine an ATI for the financial year, and an informed decision cannot currently be made to reconcile the estimate or set a status of Recon-No Change.

When more information becomes available or the tax return is lodged, the estimate can be reconciled.

Setting the status to PARKED is a 2-step process.

In the Client Income window:

• select the relevant Estimate entry and open
• set the Reconciling Status of the estimate to Recon-No Change in the Estimate Income window
• add a document recording any searches, customer contact and the decision to set the status to PARKED
• select Save

Go back to the Client Income window:

• select the relevant Estimate entry and open
• change the Reconciliation Status from Recon-No Change to PARKED

Note: once saved, the PARKED status it will not be visible in the Estimate Recon Status - this field will be blank/empty. The PARKED status will however be in the background of Cuba.

Procedure ends here.

If the Registrar has amended the assessment as a result of reviewing the estimate under section 63A, 63B or 63C then the Registrar may decide not to reconcile the estimate (sections 64(1)(e), 64A(1)(e), 64AC(1)(d) and 64AD(1)(d)).

S64(1)(d) and S64A(1)(d) Child Support (Assessment) Act 1989 provides that the Registrar may only perform the reconciliation [again] where the parent’s actual ATI is higher than the ATI amount determined under s64AB(1).

Therefore, if the Registrar reconciles an estimate using a determined ATI and the customer later lodges their tax return, Child Support:

• will not re-reconcile if the actual ATI is not higher than the determined ATI
• can re-reconcile if the actual ATI is higher than the determined ATI

Note: the customer can object to the decision to re-reconcile or not (whichever is relevant).

When notification of an ATO income is received, Cuba will create a Pending Auto Reconciling intray.

For manual intervention, go to Step 2.

Select the relevant condition where a determined income has been used for the purposes of reconciliation.

If the actual ATO income results in an ATI that is:

• higher than the determined ATI, go to Step 4
• not higher than the determined income, go to Step 3

Where the actual ATI is not higher than the determined ATI used for the purposes of reconciliation, the estimate will not be re-reconciled and there will be no change.

• In the Client Income window, document the following in the pended reconciling entry:
  Subject: Actual ATO Income received
  Text: Notification of an ATO Income has created a new pended reconciling income entry. An ATI had been determined previously for the purposes of reconciliation. As the ATI resulting from the ATO income is not higher than the determined ATI no further action is required and the pended reconciling income entry has been deleted.
  Legislation: S64(1)(d) & S64A(1)(d) Child Support (Assessment) Act 1989 provides that the Registrar may only perform the reconciliation [again] where the parent’s actual ATI is higher than the amount determined under s64AB(1)
• Delete the pended reconciling income entry

Procedure ends here

Where the actual ATO ATI is higher than the determined ATI used for the purposes of reconciliation, the estimate will be considered for re-reconciliation. Select from the following manual intervention conditions:

• One pended reconciling entry in the Client Income window and the associated estimate has a Reconciliation Status of Recon-No Change, go to Step 5
• Two reconciling entries. One entry is pended and the second shows as currently used, go to Step 9

Test the reconciliation result:

• open the pended reconciling entry from the Client Income window
• from the Reconciling Estimate income window, select the Reconciliation Calculator
• select Income/Deduction Details button
• select OK to return to the Reconciliation Calculator
• select Calculate

Note: do not save the updated pended reconciling entry.

Did the test result in a change to the assessment?

• Yes, determine if the estimate needs reconciliation, If reconciliation is:
• required, go to Step 7
• not required due to an unintended outcome, go to Step 12. E.g. a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated
• No, go to Step 6

• Document the following in the pended reconciling entry:
  Subject: Pended Rec - Actual ATO ATI rec’d
  Text: Notification of an ATO Income has created a new pended reconciling income entry. The estimate was previously set to Recon-No Change using a determined ATI for the purposes of reconciliation. The estimate has been reviewed on receipt of the higher ATO income. As there will be no change to the assessment through reconciliation, the current status of Recon-No Change is considered accurate. No further action is required and this pended reconciling income entry has been deleted.
  Legislation: <include one of the following>

Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election
or
Child Support (Assessment) Act 1989, Section 64A Reconciliation using a parent’s actual adjusted taxable income - more than one election.

• Delete the pended reconciling income entry

Procedure ends here.

• Update the Estimate Reconciliation Status, in the Client Income window:
• select and open the associated estimate
• change the Recon-No Change status to NONE
• Document the following:
  Subject: Recon-No Change set to NONE
  Text: The estimate was previously set to Recon-No Change using a determined ATI for the purposes of reconciliation. This status has been changed to NONE as it is no longer accurate. Reconciliation is now required on notification of a higher ATO ATI.

To reconcile the estimate:

• open the pended reconciling entry in the Client Income window
• from the Reconciling Estimate Income window select the Reconciliation Calculator
• select Income/Deduction Details button
• select OK to return to the Reconciliation Calculator
• select Calculate
• select OK

Document the following:

Subject: Est Rec - Actual ATO ATI received

Text: Notification of an ATO Income has created a new pended reconciling income entry. The estimate was previously set to Recon-No Change using a determined ATI. The estimate has been re-reconciled as the ATO income is higher than the determined ATI.

Legislation: <include one of the following>

Child Support (Assessment Act) 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single income election or,

Child Support (Assessment Act) 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.

Check the letters that issued to the estimating and non-estimating parent, see Letters Cuba Process Help, View or preview a letter

See Table 19, Step 2.

Where an estimate had been previously reconciled using a determined ATI, the new ATO ATI will create a second reconciling entry in the Client Income window. The first entry will have a status of CURRENTLY USED, the other PENDED.

Delete the currently used estimate reconciliation

In the Client Income window:

• Select the Currently Used reconciling income from the Client Income list, document the fooling in a new notepad
• Subject: Reconciliation deleted
• Text: Actual ATI received and estimate required re-reconciliation
• Select:
• the Currently Used reconciling income
• Delete from the File menu
• the Yes button to confirm

Deletion may produce MIR1-1/1-2, MAC1-3/1-4 and NOA-01 letters.

Delete letters for both customers if not appropriate to issue.

If deleting the NOA-01, also delete letters in the Suppressed letters list

See Letters Cuba Process Help, delete a letter.

Select the Pended reconciling income from the Client Income list box to open it:

• from the Reconciling Estimate Income window select the Reconciliation Calculator
• select Income/Deduction Details button
• select OK to return to the Reconciliation Calculator
• select Calculate

Check the result, and determine if the estimate requires reconciliation

Does the estimate require reconciliation?

• Yes, the actual ATI is higher than the estimated ATI and the outcome is as expected. Go to Step 11
• No the actual ATI is higher than the estimated ATI but does not require reconciliation due to an unintended outcome, go to Step 12. E.g. a decrease in liability for a Paying Parent who has underestimated, or an increase in entitlement for a Receiving Parent who has underestimated

• In the Reconciling Estimate Income window, select Recorded from the Status dropdown menu
• Document the following in a new notepad:
  Subject: Est Rec - Actual ATO ATI received
  Text: Notification of an ATO Income has created a new pended reconciling income entry. The estimate has been re-reconciled as the actual ATO ATI income is higher than the determined ATI.
  Legislation: <include one of the following>
  Child Support (Assessment) Act 1989, Section 64, Reconciliation using a parent’s actual adjusted taxable income - single election or,
  Child Support (Assessment) Act 1989, Section 64A, Reconciliation using a parent’s actual adjusted taxable income - more than one election.
• Select Save
• Check the letters that issued to the estimating and non - estimating parent, see Letters Cuba Process Help, View or preview a letter
• See Table 19, Step 1

• In the Client Income window, delete the pended reconciling entry. This should automatically delete the pended reconciliation intray
• Manually delete the Reconciliation Required intray
• In the Estimate Income window:
• set status of estimate to Recon No Change
• add a notepad to explain the unintended outcome, for e.g.:
  Subject: Recon No Change
  Text: The customer was assessed on the Fixed Annual Rate (FAR) based on their estimate and reconciliation would result in an assessment of less than the FAR.
  In cases where reconciling an estimate with a higher income would benefit the estimating parent, the estimate must not be reconciled.
  The status of the estimate has been set to Recon-No Change.
  Reference: Table 1 Step 6 ‘Reconciliation with an unintended outcome’, in Manual reconciliation procedure for child support estimates (from 1 July 2011) 277-0706002

Procedure ends here

A reverse case occurs when both parents are (or have been) assessed to pay child support for a child. Cuba generates 2 linked cases to show each parent’s liability reflected in a single assessment.

Manual intervention is usually required because the existing case and the reverse case have different child support periods (CS Period) or different incomes or both. Resources has an example of 'Estimate reconciliation: Reverse case'.

Note: check eligibility because non-estimate related errors or liability changes need to be resolved before starting any manual intervention process.

Are there any non-estimate related eligibility issues?

• Yes, see Eligibility Cuba Process Help
• No, go to Step 2

Alignment issues usually relate to a CS Period being:

• cut short because one case ended when the reverse case commenced, or
• missing, and is required for the estimate period (this will usually relate to a CS Period that ran before the start date of the reverse role)

Different incomes

Reverse cases in Cuba do not represent separate cases. If the customer has had a role of both payee and payer in one case, the estimate must be recorded for both roles in Cuba. An estimate inadvertently omitted on the reverse case is needed to be added before reconciliation.

Resolve reconciliation issues in the following order:

• Different CS Periods, go to Step 3
• Different incomes, go to Step 5

Is CS Period alignment required for more than the last relevant year of income (LRYI)?

• Yes:
• Complete the Correcting errors macro. Escalate to an SSO to action. For more details, see Correcting a complex Child Support error
• Procedure ends here
• No, go to Step 4

Open the Child Support Period - Production window for each case. Take screen shots of the CS Periods that relate to the estimate period.

Review the screen shots to identify any CS Periods that have been cut short, are new, or are missing.

For a detailed description of adding and deleting CS Periods see, Child Support Period Management Cuba Process Help.

Note: do not save eligibility. The CS Periods must continue to display as aligned to allow reconciling to proceed without errors.

• On the ended case where the CS Period has been cut short:
• delete that CS Period
• add a new CS Period with the same start date but with the extended end date to match the CS Period end date of the existing case
• add any new CS Periods
• the CS Periods will now replicate those of the reverse case
• On the case with the missing CS Period:
• delete all CS Periods back to a date that allows the missing CS Period to be added
• add a new CS Period that aligns with the start and end date of the reverse case (covering the start date of the estimate)
• add the deleted CS Periods back, including any new CS Periods
• both cases should now display the same CS Periods, that is, from the one required for the estimate, and up to, and including the latest CS Period

Have the incomes been correctly applied to all roles?

• Yes, go to Step 6
• No, the incomes need to be added after any required updates to the CS Periods and before reconciling the estimates. Go to Step 5

If incomes have not been applied correctly to all roles, complete the Correcting errors macro and escalate to an SSO to action. For more details see Correcting a complex Child Support error.

Add estimates:

• Identify the estimate entries not applied to the reverse case. For each entry:
• take screen shots of the Estimate Income - Production and Estimate Components Details - Production windows
• take copies of the original notepad from each estimate and amended estimate. These can be added to the records applied on the reverse case, in addition to the Correcting Errors submission notepad
• Open a new Estimate window to record the missing estimate/s ensuring dates and amounts of each estimate/amended estimate on the reverse case exactly match those of the existing case. Even if a reverse case starts and/or ends on a different date, the estimate details must match on each case
  Note: each time an estimate is recorded the CS Periods must be realigned, as per step 4. This is because Cuba automatically saves eligibility and removes the CS Periods added
• Add the Correcting errors submission notepad, and a copy of the notepad from the relevant estimate on the original case, to each added estimate entry. The copy of the original notepad can be preceded by a note stating:
  ‘As per the Error correction submission notepad, this estimate is being keyed to align estimate records on reverse cases. The original notepad from the estimate is copied below'
  For more information about applying an estimate to a reverse case, see Table 2, Step 2 in Complex system processing for reverse child support cases.
• Check the status of the estimate entries:
• The added estimate entries on an ended case will have a status of Recorded as they are not being used in the assessment
• If the estimate applies to a period where the case was active, a status of Recorded may also show. Eligibility will need to be run and saved, as Cuba needs to apply the estimate to the assessment. The estimate status will update to Currently Used
• Estimates added with a start date before that case role commenced, will have a status of Currently Used. If a subsequent estimate is added that also has a start date before the case role commenced, the status of the preceding estimate will update to Revoked, and the subsequent estimate will have a status of Currently Used
• Load the CS Periods again and then reconcile the estimates

There may be Pended Reconciling entries generated on receipt of the Australian Taxation Office (ATO) income. If not, then manually reconcile the estimates.

Is the actual ATI higher than the expected ATI?

• Yes, action the reconciliation on the closed case first to avoid additional CS Period alignment:
• Take a screen shot of the Reconciliation Calculator-Production window, as viewing the Reconciliation entry may not be possible once it has been saved. Refer to the screen shot to check that the outcome has been applied correctly
• Add the Correcting Errors submission to the notepad
• Select Save, ‘Error’ messages may appear. Select OK. If necessary, select Save more than once
• If the Reconciling entry has a status of Recorded and/or any estimate or amended estimate still has a status of Currently Used, go to the Eligibility window and check the result by comparing it to the screen shot of the Reconciliation Calculator -Production window. If the result is one that is expected, save eligibility. Saving eligibility will update the Reconciling entry’s status to Currently Used and the estimates/amended estimates should now all have a status of Reconciled
• Check the letters. The estimate reconciliation letters (ME4-3 & 4-1 or NOA-01) do not generate for an ended reverse case, however assessment notices generate for both customers using the reconciling ATI
• No:
• Set the Reconciliation status of the estimate to Recon-No Change in the Estimate Income window
• Document the decision
• Procedure ends here

Contact both customers when amending a previously reconciled estimate to discuss any changes to the assessment or overpayment of child support. Where an overpayment has occurred, see Child Support overpayments and other payee debt.

Estimate reconciliations can cause retrospective role reversals where the parents have shared or divided care. If a role reversal occurs, see Managing reverse child support cases for information about how to make sure that reverse cases are accurate.

If the customer cannot be contacted, send either:

• UQ90.03 Re-reco cover letter for estimating parent, or
• UQ90.04 Re-reco cover letter for non-estimating parent

Include the information used to make the decision and the new assessment notice.

Note: this is not an alternative to customer contact and must only be used where all proactive phone contact has been attempted.

Estimate penalties automatically apply when an estimate is reconciled, and the actual adjusted taxable income (ATI) for the estimated period is 110% or more of the estimated amount. The penalty is 10% of the difference between the liability based on the estimate and the liability based on the reconciling ATI for the related estimate period.

Cuba will calculate and automatically apply the estimate penalty when processing the reconciliation.

Remission of estimate penalty

The customer may request remission of all or part of the estimate penalty.

The References page has a link to The Child Support Guide 2.5.1: Income estimates for a year of income.

For more about remitting an estimate penalty, see Penalties Cuba Process Help, Remit or cancel penalties.

Customers will be automatically advised by letter of an amendment to their assessments resulting from an estimate reconciliation.

These letters are generated by the system:

• ME4-1 To the non-estimating customer advising that an estimate has been reconciled and a new income is being used
• ME4-3 To the estimating customer advising that their estimate has been reconciled and a new income is being used
• NOA-01 To both parents. Sometimes the system:
• suppresses the Cuba letters, and
• issues a NOA-01 CS Notice of Assessment and covering page consolidating the decision letters. Consider when NOA-01 letters issue

Document any discussion, calculations and decisions in the Reconciling Estimate Income window notepad, including:

• the year being reconciled
• how the actual or determined ATI amount was calculated
• details of all investigations
• customer contact details
• all contact attempts if the customer could not be contacted, including time and date
• legislative references, and
• any other relevant information

Note: do not duplicate information recorded in the estimate reconciliation calculator. Summarise the differences from the actual or determined ATI to the estimated ATI. This supports decision making and assists with future customer discussions.

If a customer disputes the estimate reconciliation outcome, see Customer disputes reconciliation outcome.