Waiver of debts resulting from the assessment of lump sum arrears of a reversionary income stream 107-18092721

This is one of several waiver provisions. Test all waiver provisions relevant to the customer's circumstances. This can be before or after recovery has commenced. See Non recovery, waiving Centrelink debts.

The legislative instrument Social Security (Waiver of Debts - Bereavement Period) Specification 2017, effective from 9 May 2018, allows waiver of a debt where:

• the assessment of lump sum arrears from a reversionary income stream, and
• it was incurred during the bereavement period for the surviving spouse

Do not waive any debt incurred after the 14 week bereavement period. The legislative instrument is not retrospective. Any debts incurred before 9 May 2018, cannot be waived under class of debt waiver provisions.

If a reversionary beneficiary acquires the income stream on the death of the primary beneficiary, the event date is the date the customer (reversionary) became eligible to the income stream payment. This can include:

• lump sum arrears plus
• regular ongoing payments

Some income stream providers report this as the commencement date for the spouse (reversionary).

Lump sum arrears are payable:

• from day after date of death of primary beneficiary to
• the date regular payments commence

Assess lump sum arrears as income from an income stream. The event date will be the day after the date of death of the primary beneficiary (deceased spouse). Assessing the lump sum in this way applies even though other income and assets are assessed at the end of the bereavement review in cases where the customer does not advise the changes prior to the review.

The debt is a Social Security Act debt (or relevant part of such a debt) where the person receives a lump sum payment in arrears that meets all of the following:

• occurs within a bereavement period or part of that period
• reverted to the person on the death of a primary beneficiary when the person and primary beneficiary were a member of a couple
• does not cover a period prior to 9 May 2018, and
• the debt did not result in any part from the customer knowingly providing a false statement or representation to comply with the Act

A finalised fully recovered (FRC) debt requiring a waiver must have the repayment history adjusted by Debt Staff before the waiver can be coded.