greater support for families with teenaged children

Date of effect: 1 January 2012

Families with children aged between 16 and 19 who are studying full time will receive a raft of new support measures under changes to the Family Tax Benefit A.

These changes will:

Youth Allowance will continue to be available for 16 to 19 year olds who are independent, living away from home or not in full-time secondary study, and for people aged 19 years and older. All Youth Allowance recipients aged 16 to 19 on 1 January 2012 will have the option to remain on Youth Allowance.

aligning family tax benefit A and youth allowance eligibility

Date of effect: 1 January 2012

The eligibility for Family Tax Benefit Part A (FTB-A) will be limited to children up to 21 years of age. This recognises that young people aged 22 and over are considered independent. This means that when a child turns 22, parents will no longer be able to receive Family Tax Benefit A for that child.

However, the child may be eligible to receive Youth Allowance. This will bring Family Tax Benefit A in line with the Youth Allowance age of independence.

pausing of family payment income test indexation

Date of effect: until 1 July 2014

The following higher income thresholds and limits will remain fixed until 1 July 2014:

pausing of family tax benefit supplement indexation

Date of effect: until 1 July 2014

Indexation of the Family Tax Benefit Part A and B supplements will be fixed at the current 2010/11 levels of:

flexible advances for family tax benefit part A

Date of effect: 1 July 2011

To help families meet unexpected expenses, they’ll be able to receive an advance up to $1,000 of their annual Family tax Benefit A entitlement.

Advances will be repaid over six months by reducing future fortnightly Family Tax Benefit payments. Families will also be able to apply to receive an advance of around $160 on a regular basis, paid every six months.

paid paternity leave scheme delayed

Date of effect: 1 January 2013

The implementation of Paid Paternity Leave will now take effect from 1 January 2013. The measure will provide eligible working fathers, and other partners who are providing full-time care or sharing the child’s care, with two weeks paternity leave paid at a rate equivalent to the national minimum wage where children are born on or after 1 January 2013.

disability support pension changes

Date of effect: Various

These changes include:

changes to child support income assessment

Date of effect: 1 July 2011

Under new arrangements, Child Support payers who are late lodging or fail to lodge a tax return for two years or more will have their income assessment based on their last known taxable income, indexed by growth in average wages during the period since their last return.

Currently, for such clients, the assessment is based on a default income of two thirds of Male Total Average Weekly Earnings (MTAWE), often resulting in an underestimation of their actual income.

encouraging workforce participation

Date of effect: various

A number of measures will be introduced to encourage workforce participation by many people receiving Government benefits. These include:

several DVA changes

Date of effect: various

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more information?

For more information on how any of these changes may impact your personal situation, please contact us on 07 3833 3999.
The information contained in this Federal Budget Analysis is current as at 11 May 2011 and is prepared by MLC Technical, a division of GWM Adviser Services Limited ABN 96 002 071749, registered office 105-153 Miller Street North Sydney NSW 2060. This company is a Australia Financial Services Licensee and member of the National Australia group of companies. Any advice in this communication has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on any advice, consider whether it is appropriate to your objectives, financial situation and needs.