Attributable stakeholders for private companies 043-04010080

Where a customer controls or has contributed to a private company, the assets and income of that company may be taken into account (attributed to the customer) when assessing the customer's entitlement to income support payments or concessions. The determination is made by a Complex Assessment Officer (CAO), based on information provided on the Private Company form (MOD PC) and accompanying documents.

All customers claiming, or in receipt of, mean tested income support payments made under the Social Security Act 1991 and Veterans' Entitlements Act 1986 with an involvement in a private company may be affected by attribution.

Attribution of the income and assets of a company will be based on the following tests:

• formal control test
• informal control test
• source test

If a company is a controlled private company and customer has an involvement, then that customer is an attributable stakeholder unless the Complex Assessment Officer (CAO) determines otherwise.

The MOD PC contains information relevant in determining whether a customer is an attributable stakeholder, such as:

• all parties acting as directors
• all shareholders and the nature and extent of their share holding
• contributors and the extent of their contribution
• genuine investors and the extent of their investment (equity contribution)
• customer's loans to the company and the extent of those loans (loan contribution)
• persons who have made gifts and the extent of their gifts (gift contribution)
• the relationship of the parties to each other

It will be necessary to show how the income and assets have been apportioned, that is the percentage and/or dollar amount and to whom. It may be possible for an organisation to have the income attributed in different percentages or dollar amounts to the attribution of the assets.

Relevant factors stipulated by legislation for an attribution decision are:

• the strength of control available to be exercised (for example, whether control is shared)
• the exercise of control in practice
• whether any contributions have been made to the affected structure and their size in relation to the total assets of the structure
• the scope for the controller/s to benefit from distributions
• the history of distributions of capital and income from the structure
• the use and enjoyment of the assets and/or income from the structure
• any pre-existing or proposed attribution as determined by another Commonwealth department or agency (for example, Department of Veterans' Affairs)
• any other factor that, in the opinion of the Secretary of the Department of Social Services, should be taken into account

If the outcome is that the customer is to be considered an attributable stakeholder but the CAO or the customer considers this unfair or that it was not an intended consequence of the legislation and policy, a submission to have the decision reconsidered can be lodged.

If a CAO wishes to have the decision to consider the customer as an attributable stakeholder reconsidered, all relevant information and documents need to be collated and a formal submission made to the National Income and Assets policy Level 2 helpdesk. The helpdesk may consult with the Level 3 helpdesk. If needed the Level 3 helpdesk will consult with the Department of Social Services (DSS).