Maintenance Income Credit (MIC) 277-51190010

The MIC allows families with a child support entitlement registered for collection by Child Support to access their unused Maintenance Income Free Area (MIFA) from previous financial years to offset the effect of child support arrears on FTB. Before the introduction of the MIC, any unused MIFA was not carried forward from one year to the next.

The MIC first became available to customers during FTB reconciliation or lump sum claim payment for the 2006-07 financial year. The MIC balance is carried over from the previous financial year, starting from 2000-01. From 1 July 2012 MIC calculations will extend to include children aged 16-19 years as the Maintenance Income Test (MIT) can also cover children aged 16-19 years.

If the customer has received:

• more than their child support entitlement, they can access their MIC balance to offset the effect of the child support arrears on FTB, and their MIC balance will be depleted
• less than their child support entitlement, and the amount they received was less than their MIFA, their MIC balance will accrue for the following year. The MIC will accrue in relation to a child support child only.

The MIC has no effect during the financial year. It is only applied at FTB reconciliation or as part of the Centrelink lump sum claim process.

FTB reconciliation may occur where reconciliation for an earlier year has not yet occurred but which could result in a MIC accrual or depletion for that year, and so affect the current reconciliation result. This can happen if tax returns are not lodged in sequence.

If the earlier financial year is 2005-06 or later, the time limit for the 'potential MIC accrual' to occur is the time limit that applies for lodging tax returns to satisfy the FTB reconciliation conditions.

Parents who separate during the financial year each retain their MIC balance from the previous financial year for their child support case. The customer's MIC balance cannot be used to offset child support received by their ex-partner during the period they were a couple. The ex-partner's MIC balance may be depleted due to child support arrears they received in that period.