Changing from Child Support collection to private collection: effect on Family Tax Benefit (FTB) 277-51130080

Advise customer:

• paying parent is still liable to pay child support
• Family Tax Benefit (FTB) customers will be deemed as receiving their full child support entitlement privately, regardless of the amount actually received unless an exemption from the Maintenance Action Test (MAT) has been granted

To change from Child Support collection to private collection, refer the customer to Child Support. For contact details, see Child Support.

Customers can state from what date they want collection to stop. See information about reconciling with paying parent in Effect on Family Tax Benefit (FTB) where the customer elects to suspend or end a child support assessment.

From 1 July 2012 a customer privately collecting their child support will be deemed to receive their full child support entitlement, unless they have been granted an exemption, in which case, they will be granted a partial exemption and are able to collect whatever they can if they are unable to collect their full entitlement. See Exemptions from seeking child support for Family Tax Benefit (FTB) customers. The deemed amount applies both when the amount collected is less than the entitlement amount, and when the amount collected exceeds the entitlement amount.

Child Support will advise Centrelink of a change in collection method. The MAT code for the child will be automatically updated from 'CCC' (Child Support Collect Case) to 'CAM' (Child Support Assessment Made) from the date Child Support stops collection.

To confirm change:

• go to the Family Assistance/Maintenance Action page
• MAT code CAM will be displayed from the date private collection has commenced

The amount privately collected by the customer will only need to be recorded in limited situations. See Recording private maintenance income on Centrelink system.

Does the customer intend to ask Child Support not to pursue collection of arrears owed from the Child Support collection period?

• Yes, go to Step 5
• No, go to Step 4

Entitlement method is used to assess maintenance income from the payer if private collection is chosen.

Is the Entitlement method currently being used for this group?

• Yes, the customer's FTB Part A rate will not change
• No, the customer's FTB Part A rate may change, as the assessment method will automatically change to the Entitlement method for the entitlement group once Child Support confirms the change in collection method. Any change in the customer's rate of FTB Part A will take effect from date paid to plus 1 once Child Support confirms they have ceased collection

At reconciliation, the actual date of the change in the collection method will be used to reassess FTB Part A entitlement.

When a customer changes from Child Support collect to private collect they may be owed arrears from the Child Support collect period. The customer may ask Child Support to pursue collection of the outstanding amount or they may elect not to have Child Support pursue collection of some/all of the outstanding amount.

A request to discharge arrears can be made at any time and periodic discharges can be made by the customer.

A customer electing not to have Child Support pursue collection of outstanding amounts will have a 7 day cooling off period applied before Child Support actions the request. The customer is advised to contact Centrelink during this period to see how the decision will affect their FTB. A customer may decide not to continue with their request during the cooling off period. The customer should be advised that if they discharge arrears in the current financial year, their entitlement to FTB may be affected by the application of Mandatory Continuous Adjustment. The arrears amount will be included in the Maintenance Income Test in addition to the customer's ongoing child support entitlement. If the customer has reconciled with the other parent, the discharge of arrears should still be recorded.

If a customer contacts Centrelink, they will be able to provide information about the amount to be discharged and the date the request was made.

Is the customer advising they are discharging an arrears amount?

• Yes, go to Step 6
• No, the customer must be advised to make further contact with Centrelink if they proceed with the election to discharge arrears, as the amount will need to manually recorded so that the customer receives the correct entitlement of FTB Part A. Procedure ends here

If the customer advises they have asked Child Support not to pursue collection of an amount owed from a Child Support collection period, or they intend to proceed with discharge after a 7 day cooling off period, create a Fast Note. Select Auto Text, use Families > Enquiry > Maintenance Enquiry.

Keywords: the 'Maintenance Enquiry' template automatically includes the relevant 'ACTCSU' keyword. The 'URGENT' keyword must be manually added to the Fast Note, if needed.

For further information, see Recording private maintenance income on Centrelink system.