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Income Test for single allowance customers 108-01020010

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This document outlines the application of the Income Test for single allowance customers.

Applying the Income Test for allowance customers

Step

Action

1

Is the customer a full-time student or Australian Apprentice / Trainee? + Read more ...

2

Is the Customer receiving Employment income? + Read more ...

3

Working credits + Read more ...

Check the WC Balance Summary (WCBS) screen to see if the customer has accrued a Working Credit balance. If there is a number greater than zero in the Balance: field, calculate Working Credits to determine the adjusted total ordinary income to be used in the rate calculation. For more information, see Working credits.

4

Determine fortnightly income + Read more ...

Determine the customer's fortnightly total ordinary income before tax:

  • If the ordinary income is less than $150 a fortnight, there is no effect. Go to Step 7
  • For principal carers receiving JobSeeker Payment, their payment reduces by 40 cents for each $1 of ordinary income above $150. Go to Step 7
  • For other customers:
    • If the ordinary income is between $150 and $256 per fortnight, or between $150 and $250 per fortnight for YA (job seeker) customers, go to Step 5
    • If the total ordinary income is above $250/$256, go to Step 6

5

Calculating income reduction amount above $150 + Read more ...

The customer's payment will be reduced by 50 cents for each dollar of ordinary income above $150 per fortnight.

Income reduction amount = (ordinary income for the fortnight - $150)/2.

For example, if the ordinary income earned was $182, the income reduction amount would be ($182 - $150)/2 = $16.

Go to Step 7.

6

Income above $256/$250 + Read more ...

The customer's payment will be reduced by:

  • 50 cents for each dollar of ordinary income between $150 and $256, or between $150 and $250 for YA (job seeker), and
  • then 60 cents for each dollar of income above $256/$250

To calculate income reduction amount for the fortnight, use the following formula:

  • For allowance customers the income free area is $150, income reduction amount = {(ordinary income for the fortnight - $256) x 60%} + $53
  • For YA (job seeker) customers the income free area is $150, income reduction amount = {(ordinary income for the fortnight - $250) x 60%} + $50

If the customer has employment income and receives nil rate due to the Income Test, advise the customer they may remain current at a nil rate for a period of up to 12 consecutive fortnights. See Employment income nil rate period.

7

Coding employment income + Read more ...