Backdating a Maintenance Action Test (MAT) exemption to take action to receive child support prior to 1 July of the previous financial year 277-51070100

This procedure should only be referred to:

• once a decision on an exemption has been made, and
• special circumstances for a period before 1 July of the previous financial year need to be considered

For arrears to be assessed for a period before 1 July of the previous financial year, special circumstances for backdating a maintenance action exemption must first be established.

That is, there must be special circumstances which prevented the customer:

• from applying for a formal review of their rate of payment and/or
• MAT failure within 52 weeks of it occurring

If special circumstances cannot be established, arrears are limited to 1 July of the previous financial year

A customer's right not to discuss sensitive matters must be respected. Do not record sensitive material on a customer's record.

Service Officers can backdate exemptions if the circumstances existed before.

This may be appropriate for:

• instalment customers, and
• customers who lodge an FTB claim for a past period

Exemptions are backdated if circumstances existed before the date of claim for the entire backdated period.

Generally the date of effect can be no earlier than 1 July of the previous financial year; that is, arrears of FTB are generally limited to 1 July of the previous financial year. When backdating an exemption before 1 July of the previous financial year, for arrears to be paid, special circumstances for backdating a maintenance action exemption must exist. Any evidence found to support the backdating must be outlined in the assessment. The DOC must include the date on which the exemption takes effect. When backdating an exemption before 1 July of the previous financial year, update the DOC to include what special circumstances exist.

The case will then be referred to a Families Service Officer (SO5):

• to assess if special circumstances can be established for the period before 1 July of the previous financial year
• who will liaise with the referring officer as needed

A partial exemption may be granted in private collect cases, if:

• a customer is unable to collect their full entitlement, and
• it is not considered appropriate for them to transfer the collection method to Child Support

A partial exemption allows:

• the customer to collect whatever they can privately
• the customer's rate of FTB Part A based on the amount of child support received, not the amount of the child support assessment

There may be outstanding arrears owing on the child support case, if a customer:

• is granted an exemption, and
• has a current child support case

Customers can no longer ask Child Support to backdate the case end to align with the exemption start date. In the past, backdating the end to align with the exemption start date allowed any arrears of child support to be offset (essentially removed). However, a customer can elect to discharge any arrears outstanding without them being taken in to account for Maintenance Income Test (MIT) purposes. This effectively means that there is no requirement to backdate exemptions for this customer group.

Family and domestic violence circumstances present

If a customer is granted an exemption from the MAT and there are outstanding arrears owing on the case, the customer can:

• end the case, and
• discharge any arrears accrued

This means the customer is advising Child Support they will collect the arrears privately. Ordinarily, if a customer chose to collect arrears themselves, that amount would be assessable under the MIT. However, if the customer is granted an exemption, the 'discharged' amount will not be taken into account for MIT purposes.

For social workers

The following may indicate that an exemption is not appropriate:

• the customer is granted a full exemption, and has arrears accrued for a previous Child Support collect period, and
• the customer elects not to discharge the arrears

If the customer elects to collect the arrears they will be assessable under the MIT.

It may be appropriate to backdate an exemption, if:

• a customer has a private collect child support case, and
• there are family and domestic violence circumstances present

The backdating of the exemption is to offset the effect of child support that the customer was deemed to have received. However not received due to the family and domestic violence circumstances.

This allows Centrelink to re-assess their FTB entitlement based on the actual amount of child support they received during this period.

Customers can no longer ask Child Support to backdate the case end to align with the exemption start date.

This means:

• if the customer is granted a full exemption from a date in the past
• additional coding is required by Centrelink to remove the uncollected child support from the Maintenance Income Test (MIT)

Child Support no longer needs Centrelink approval to accept an election to end an assessment from:

• 15 May 2019 for WA Ex-nuptial cases, and
• 1 July 2018 for all other cases

Before the above dates:

• if the customer or their partner were in receipt of FTB Part A at more than the base rate
• approval of the Secretary approval was required to end the child support case

A customers Family Tax Benefit (FTB) Part A rate may reduce to the base rate if they or their partner do not have a MAT exemption. This is, even if entitled to get more FTB Part A.

Child Support will discuss and confirm:

• the implications of the election to end on their FTB Part A entitlement, and
• if the customer or their current partner is claiming FTB, or
• if they intend to claim FTB at the end of the financial year

Child Support will offer to transfer the parent through to Families staff to discuss the potential impacts before making a decision to end the case. This may ease any unexpected and unnecessary financial hardship for the parent. This may include more discussions around whether an exemption may be appropriate.

Note: approval of the Secretary was still required to end a child support assessment on a WA Child Support ex-nuptial case between 1 July 2018 and 14 May 2019.

To end a case, the customer must lodge a request with Child Support, or, the Ending a child support assessment (CS1671) form may be used. Child Support will still need to speak with the customer before they can end the case.

Discharging arrears

When there are outstanding arrears owing on the child support case, and a customer:

• is granted an exemption, and
• has a current child support case

The customer may elect to discharge these arrears without having the discharged amount taken into account for Maintenance Income Test (MIT) purposes.

When a:

• full exemption is granted, the child support email template to have the child support case ended must indicate if the discharging of arrears has been approved. This is so Child Support are aware the amounts can be discharged
• partial exemption is granted, the child support case is not ended. The customer must tell Child Support directly if they want to discharge any arrears owed for a previous Child Support collect period