Effect of death of customer on Financial Supplement loan (FSL) after transfer to the Australian Taxation Office (ATO) 102-15010100

The Student Financial Supplement Scheme (SFSS) was a voluntary loan scheme which gave eligible tertiary students the option of borrowing money to help cover their expenses while they studied.

The term 'Student Financial Supplement Scheme (SFSS)' refers to the programme name of the Scheme. 'Financial Supplement loan (FSL)' is the product of the Scheme (that is, students applied for the product (FSL) and received this through the programme (SFSS)).

The funds for FSL were provided by the Commonwealth Bank of Australia (CBA). When the student applied for FSL, the student entered into a loan contract with the CBA for a contract period. All loans were administered by Centrelink (now Services Australia) until the end of the contract period. At the end of the contract period, the outstanding loan was transferred to the Australian Taxation Office (ATO). The loan then became a debt to the Commonwealth and is repayable through the taxation system.

If a student with an outstanding SFSS loan dies, the ATO must be notified of the death of the student. It is important to refer the enquiring party to the ATO to notify of the death of the student so that any remaining FSL debt may be discharged. The only FSL debt that the estate will be liable for is where a tax assessment has been issued up to and including the date of death (that is, if a tax return has already been assessed as requiring a compulsory FSL repayment). The compulsory repayment amount would transfer to the estate for recovery and any remaining FSL debt will be written off.

Customers can visit the ATO website for more information.

Note: the final balance on all outstanding loans will show as zero on the Services Australia system. This does not mean that the loan has been zeroed off, just that the balance has now been transferred to the ATO for recovery through the taxation system.