What are family tax benefits?
The Family Tax Benefit helps qualified families with the costs of raising their children, and this payment has two parts: Part A and Part B.
The tax on family benefits Part A (FTB A) is paid for each child. Payment is based on income, and the amount you receive is based on your family’s personal circumstances.
You may qualify for Family Tax Benefit A if you have:
A dependent child between 0 and 15 years old.
A dependent child aged 16 to 19 who fulfills the study conditions. They should:
- Attend high school full time, or
- Have an acceptable study work or
- Has been granted an exemption by Services Australia.
To benefit from FTB A, you must also:
- Complete an income test
- Meets residency requirements
- Take care of the child at least 35 percent of the time
Your child also needs to:
- Meet immunization requirements by being up to date with their injections, on a catch-up schedule, or have a medical exemption.
- Meet the “Healthy Start for School” requirements, if applicable.
Which much FTB A can I receive?
Your FTB A payment rate is calculated on the basis of:
Your family’s adjusted taxable income and proof of income and the number and ages of your children.
If you share care, the time you spend with your children is also used to calculate your payment rate.
FTB A payment is made every two weeks. It can also be made through the tax system in a single payment at the end of the year.
The maximum FTB A-amounts that you can collect per child is updated on July 1 of each year.
Income Test (Proof of Income)
The base rate for the FTB Part A in 2021/2022 is $61.46 per child for a two-week period. However, the base rate is not the minimum rate under Part A of the FTB. You can receive less depending on your family situation.
You must pass an income test to earn the FTB A, and your income determines how much you will receive.
Currently, if your family earns less than $56,137, your payment will not be affected, and you will receive the maximum FTB A rate. Also, this may be the case if you or your partner is receiving income support payments.
For families earning between $56,137 and $99,864, their FTB A rate is reduced by 20 cents for every dollar earned above $56,137 until it reaches the base FTB A rate, at which case it will not be reduced. Sometimes there is an annual income limit to get the base rate, and the age and number of children you have determine that limit.
If your household income exceeds $99,864, an income test is applied to calculate how much FTB A you will receive. This test reduces your FTB A fee by 30 cents for every $99,864 of your income until your payment is zero.
The government will not pay FTB A when your family’s income reaches a certain level, and these income limits vary depending on the number of children you have and your age.
If your family’s income is near the annual limit, you may want to consider another payment option or claim a fixed amount at the end of the year to avoid overpayment.
Maintenance Action Test
If you, as an individual or your partner, have a child from a previous relationship, you should try to get child support to get more than the base rate of FTB A. This is referred to as the Maintenance Action Test, and you can meet it by applying for a child support assessment.
In general, the more child support you receive, the less FTB A you will receive.
Family Tax Benefit Part A Supplement
If you collect FTB A, you may also be entitled to the FTB A supplement, which is an annual payment.
Your family’s adjusted taxable income must be less than or equal to $80,000, and for the fiscal year 2021/2022, the supplement can reach $788.40 per eligible child. The amount you receive depends on your family’s income, the number of days you were eligible for FTB A, the number of children you care for, and whether you share care for the child.
The supplement is paid as soon as Services Australia has balanced your payments after the end of the fiscal year. Before doing so, you and your partner (if applicable) must confirm your income by:
- Filing your tax return with the Australian Tax Office (ATO) or
- Telling them you don’t have to and confirming your earnings online.
Once the ATO confirms your earnings details, you will receive a letter telling you if you are eligible and the amount of the supplement you will receive.
Other payments associated with part FTB A
If you receive the FTB Part A, you may also be entitled to additional payments, including:
- Down payment for newborns and supplement for infants if you have a child or adopt a child
- Multiple birth allowance if you are taking care of triplets, quadruplets, or more
- A health care card if you benefit from the maximum rate of FTB Part A
- Rent assistance if you benefit from a rate higher than the base rate FTB Part A
Part B of Family Tax Benefit (FTB B) provides additional support for single parents, non-custodial parents, caring grandparents, and high-income families.
To qualify for FTB B you have to:
- An individual or a couple with one main income, and you have dependent children under 13 years of age.
- Are a single parent or guardian or grandparent carer, and you are caring for a dependent child under the age of eighteen (18). Please note that the child must meet the study requirements if he is between 16 and 18 years.
You are also:
- Caring for the child at least 35 percent of the time
- Meets residency requirements
- Respond to the FTB B income test
What FTB Part B can I get?
FTB B is paid per household, and the payment rate is based on adjustable taxable income and proof of income.
The percentage of care provided is taken into account for parents who share family responsibilities, and payment rates may change if you are a returning parent.
FTB B rates are updated on July 1 of each year, and the maximum amount you can receive largely depends on the age of your youngest child.
Income Test (Proof of Income)
The FTB B income test is updated on July 1 of each year.
Currently, if you are a single parent, you can earn up to $100,900 to receive the maximum FTB B rate. However, you will not be eligible if your adjusted taxable income exceeds $100,900.
- Individual grandparents carers can get the maximum FTB B rate if their income is $100,900 or less.
- Partnered Parent or carer family can only receive FTB B if the youngest child is 13 or younger unless they are grandparents carer when they turn 18.
A two-part income test is used to calculate FTB B payments for couples. If your primary (highest) income source earns more than $100,900, your family will not be eligible for FTB B. If you earn less than $100,900, the secondary (lower) income source is relevant.
Secondary earners can earn up to $5,840 per year before it affects their FTB B when payouts decrease by 20 cents for every dollar earned above $5,840.
If you are a secondary earner and your spouse earns $100,900 or less, you will still receive an FTB B if your income is less than:
- $28,945 per year if the youngest child is under five.
- $22,557 per year if the youngest child is between 5 and 13 years old.
Please also note that Part B of the FTB cannot be received while you are on parental leave.
Partnered grandparents carers are not eligible for FTB B if their main income is greater than $100,900. As long as they earn less, the two-tier income test is the same as above, except that the youngest child is between 5 and 18 for the income limit of $22,557.
FTB Part B Supplement
If you collect FTB B, you will also be able to receive a supplement of up to $383.25 per household at the end of the fiscal year, once you confirm your income and Services Australia balances your payments.
The amount of the supplement you will receive depends on your family’s income shared care and the number of days you were eligible for FTB B.