Low Income Health Care Card (LIC) income test 101-06040030

The LIC system will assess any employment income coded on the EAPP and EANS screens that affects the relevant LIC income assessment period.

Income from employment shows on the Employment Income Details (EAPP) screen from the claim details.

Employment details may be pre-filled through Single Touch Payroll (STP) in the online claim for the customer to confirm. This includes the employer name and ABN. Staff can recognise a STP employer has been presented if the question “Do you work for (employer)” is displayed in the claim slider. Further details can be seen on the STP Employment Update (EMCF) screen.

Staff must make sure that employment income for the relevant assessment period is coded on EAPP for each employer and each individual pay date

DOV: actual paid date from payslip (not received date)

Amount: gross earnings paid during the paid period

Frequency: LOP (long period)

Start date: start paid period from payslip

End date: end date of the paid period from payslip

Verify: NVE (default) or PVP (confirmed if payslips provided and scanned to record)

Note: claims are assessed based on employment income recorded on EAPP/EANS. Due to a system limitation EAPP/EANS and LIAS may not match, staff should make sure the outcome is correct based on applicable income limits.

Assess employment income with the income support payment. See Recording and correcting employment income details.

When assessing income support payment and LIC entitlement at the same time

If income (from each employer) is already coded and confirmed on EAPP/EANS covering:

• the full relevant income assessment period:
• no further coding is needed and any provisional claim data on EAPP/EANS for each employer may be deleted

If income is already coded and confirmed for:

• only part of the relevant income assessment period:
• remove the duplicated provisional claim data on EAPP/EANS for each employer. This will make sure that the employment income is not counted twice, as the income support payments will be automatically included in the LIC income test

For LIC only customers (and/or partners), staff must:

• code declared balances of bank accounts in the claim using the date of event (DOV) of the start of the 8 week LIC assessment period
• accept and code any substantial change to the balance within the 8 week LIC assessment period with the DOV of the change

Note: if a customer provides evidence, coding may override the original balances declared in the claim if the DOVs are equal. No evidence of bank details are needed to assess the claim.

If coding a bank account balance for a customer receiving an income support payment for the entire income assessment period, see Coding income and assets for Centrelink payments and services.

If an income support payment has been rejected, cancelled and/or assessed during the 8 week LIC assessment period, multiple DOVs may be needed. See Resources for examples.

If the Service Officer doubts the accuracy of any details provided by the customer, or, there is a significant change in the value that could affect entitlement, they must determine whether further proof/verification is required.

If coding financial investment or self-employment details for a customer receiving an income support payment for the entire income assessment period, see Recording and correcting employment income details and Coding income and assets for Centrelink payments and services.

If an income support payment has been rejected, cancelled and/or assessed during the 8 week LIC assessment period multiple DOVs may be needed. See Resources for examples.

If the customer has business income that has been updated within the last 12 months and there has been no substantial change:

• the business income does not need to be updated, and
• the customer does not need to provide verification documents,

If a customer advises that a business has stopped trading see Business has ceased or has been sold.

For more details on changes to investment or business income, see:

• Income and expenses of a business
• Commencing or returning to self-employment for JobSeeker Payment, Youth Allowance and Austudy
• Coding income and assets for Centrelink payments and services
• General notification provisions and exceptions
• Assessing income from real estate and timeshare

For LIC only customers, the DOV is the start of the 8 week LIC assessment period.

If a business or rental property started on or after the start of the 8 week LIC assessment period, the DOV will be the:

• start date of the business, or
• the date the property started generating income

LIC customers are not subject to an Income Maintenance Period (IMP). The treatment of lump sum leave and redundancy payments for LIC is different to the way such payments are treated for income support payments:

• redundancy and lump sum leave payments (where employment will not be continuing with the same employer) are recorded on the Income Maintenance Period (IMP) screen
• the LIC system transfers the details to the LIC Income Maintenance Lump Sum (LIM) screen that is a display screen only. This screen indicates the dates for which the lump sum amount is apportioned over 12 months. A customer's lump sum payments may preclude them from an income support payment, but they may still be eligible for a LIC because of the different application of income assessment. To view the LIM screen go to Customer First. See the Resources page for an example of how to assess lump sum redundancy payments
• if the customer has received a lump sum leave payment but will be returning to work with the same employer after the period of leave, this amount is coded as employment income on the EAPP screen. See details about customers advising leave payments in Leave and termination payments paid by an employer
• lump sum compensation payments and the dates for which they are apportioned over 12 months are shown on the LIC Compensation Lump Sum (LIL) screen. This information transfers from the Compensation Claim Summary (CMCS) screen that is maintained by the Compensation team. CMCS can be viewed from the Compensation Management Summary (CMPS) screen. See the Resources page for an example of how to assess lump sum compensation payments
• for customers who receive commissions or royalties see Income for an independent contractor and commission income. The Resources page has an example of royalty income

Methods for calculating a backdated start date are detailed in Processing Low Income Health Care Card (LIC) claims.

Employment income must be recorded for the 8 week period ending on the backdated start date.

Any subsequent change to employment income during the entire period up to the lodgement date of the LIC claim must also be recorded to make sure that the claimant retains eligibility throughout the backdated period.

When backdating the start date to a date on or after 7 December 2020, employment income paid is coded on the EAPP screen.

When backdating the start date to a date before 7 December 2020, employment income earned is coded on the EANS screen.

Although LIC is not subject to an assets test, the income test does apply with income from financial investments. The income assessed also includes:

• deemed income from account-based income streams
• income from income stream products, such as superannuation pensions and defined benefit income streams

See Adding or updating an account-based income stream for further instructions including determining DOV.

For details on adding or updating other income streams, see:

• Adding or updating a defined benefit or military invalidity pension income stream
• Adding or updating a pooled lifetime income stream
• Adding or updating a lifetime income stream
• Adding or updating a life expectancy income stream
• Adding or updating a term income stream
• Adding or updating a market-linked income stream
• Assessing income streams paid from Self Managed Superannuation Funds (SMSFs) or Small APRA Superannuation Funds (SAFs)

Although individual cases of deprivation may be less than the allowable yearly amount, when totalled they may exceed the gifting free areas. All assessable cases of gifting must be recorded. Assessable cases are any gifts made:

• while the customer and/or their partner are receiving LIC and
• in the 5 years immediately before claiming or becoming qualified (whichever is later)

Do not record gifts outside of this 5 year period as they will incorrectly be included in the calculation of the gifting free areas. See Assessing deprivation/gifting

For customers and/or partners who have received an income support payment within 8 weeks of the LIC claim but whose payment is now cancelled, the Date of event (DOV) of income components that have been received throughout the 8 week period will be the day after the date paid to (DPT+1) of their previous income support payment.

This DOV makes sure that the income is not counted twice. The income support payment (and any income already coded or assessed) is automatically included in the relevant income assessment period.

For Process Direct go to the Low Income Assessment Summary (LIAS) screen.

In Customer First go to the LIC Centrelink Payments (LICP) screen via the LIAS.

For LIC online claims, the Process Online Claim workflow will:

• upload income details for these recent income support payment recipients
• with a DOV of the LIC claim's date of receipt or deemed date of claim, where applicable

Service Officers need to manually adjust the DOV for these income components to DPT+1.

If an income support payment has been rejected, cancelled and/or assessed during the 8 week LIC assessment period multiple DOVs may be needed. See Resources for examples.