Writing off Centrelink debts 107-05130000

A write off of a debt occurs when:

• a debt is legally recoverable, and
• Services Australia determines not to pursue the recovery of the debt

A write off can be:

• temporary, or
• permanent

A write off does not extinguish a debt, further recovery may be pursued at a later date. Family assistance offsetting may still apply to some written off debts. See the Resource page for further information.

For details of write-off reason codes, see the Resource page in Temporary write off of Centrelink Debts and Permanent write off of Centrelink debts.

As recovery is still expected in the future, the branch’s performance report does include the value of the written off debt.

As of 1 January 2017, the former 6 year statute of limitations no longer applies.

For statute-barred debts raised before 1 January 2011, see Six year limitation write off.

The debt recovery script does not apply to debts managed within Process Direct. See Recovering Child Care Subsidy (CCS) debts in Process Direct.

Some customers may have their debt due date extended where:

• an informal account payable letter has been sent, and
• the debt is temporarily written off before the formal account payable is sent for one of the following reasons:
• BRP - Bankruptcy Pending
• BRT - Bankruptcy Awaiting Estate
• DIS - Disaster temporary write-off
• ORA - Outcome of review/Appeal
• OSA - Overseas Appeal
• PRI - In Prison
• STH - Short Term Hardship, and
• the temporary write off is due to end after the due date on the informal account payable letter

When this happens, the due date will change to 28 days after the end of the write off period. The formal account payable letter (with 28 day due date) will be triggered automatically when the temporary write off ends. This includes where a write off is ended early.

See Resources for an example.

For information on the informal and formal debt raising process see Sending Account Payable letters.

A written off debt will not accumulate an interest charge, the debt will have the status of DWO (Determined- Written Off).

Interest will cease from the date of write off.

Applying write-offs to debts that are quarantined is possible, however staff should keep in mind:

• applying a permanent write-off will end a quarantine period and replace the status
• applying a temporary write-off will not impact the Quarantine status
• temporary write-offs may be end dated while a debt is quarantined
• excluding an Outcome of Review or Appeal (ORA), all other temporary write-offs remain in place until their end date
• the status of temporarily written-off debts will be Quarantine (QTN)
• quarantine rules will take precedence over the business as usual temporary write-off rules

A debt status will become Determined - Pending Recovery Action (DWO) when it exits quarantine if:

• a temporary write-off is present
• it has not reached its end date, and
• it has an outstanding balance

See Quarantine of Centrelink debts.

Cost effectiveness of recovery can be a reason for a decision to write off a PGPA debt.

The References page contains links to Accountable Authority Instructions (AAIs).