Australian GovernmentPayments & Services

Financial Information Service

Who we are...

Free, confidential service, available to all

We specialise in:•Social Security•Taxation•Superannuation•Financial Industry rules

“Accessible information for all Australians”

Information about investment options• Investment types and strategies• Advantages and disadvantages• Security and risk

Effect on • Pensions and allowances• Taxation

What we do...

“Helping people make best use of their financial resources”

Advise on or recommend any particular:• Products• Providers

Tell you what to do with your money• That decision is yours

Assess pensions and allowances

But, we do not...

“Financial Information…not Financial

Advice”

• Financial Seminars• Phone • Personal

consultations

132 300 or humanservices.gov.au/fis

Our service to you

• Looking for Work

• Australian Government Payments

• Waiting Periods

• Income and Assets

• Rates

• Concessions

Today’s Presentation

The information in this presentation is intended as a guide only. The Department of Human Services (DHS) cannot warrant that it is complete, accurate or free from faults.

This presentation is current at 01 July 2012DHS recommends that persons refer to Human Services Online (www.humanservices.gov.au), DHS telephony or Service Centres, to fully enquire about income support payments and or services.

© Commonwealth of Australia 2012This work is copyright. Apart from any use as permitted under the Copyright Act 1968, no part may be reproduced by any process without prior written permission from the Commonwealth. Requests and inquiries concerning reproduction and rights should be addressed to the Commonwealth Copyright Administration, Attorney General’s Department, National Circuit, Barton ACT 2600 or posted at http://www.ag.gov.au/cca

Disclaimer

Planning to Study

Raising Children

Disabled

Looking for Work Caring for

Someone

Retiring

Your Situation...

Under 22 yrs old - Youth Allowance

Over 22 yrs old- Newstart

• Unemployed or working part-time• Capacity to work• Residence qualifications

Looking for Work

Intent to Claim • download claim forms (if required)

Rapid Connect to Job Services Australia• interview with employment service provider

Claiming a Payment

132 850 or humanservices.gov.au

• Those of workforce age who are able to work are expected to seek paid work

• Training activities

• Work experience• Work for the Dole

• Voluntary Work

Employment Pathway Plans

Other Payment Types

Under 25 yrs old• Youth Allowance

Over 25 yrs old• Austudy

Abstudy

Planning to Study

Parenting Payment*• if partnered

• dependent child under 6• if single

• dependent child under 8

Family Tax Benefits• discussed in more detail later

*Those granted before 1/7/06 may remain on Parenting Payment until youngest child turns 16 (conditions apply)

People with Children

Disability Support Pension• over 16 yrs old• under Age Pension age• medical impairment• unable to work more than 15

hours pw for at least 2 years (or be retrained)

*Those who are able to work at least 15 hours pw will be expected to look for work.

Special provisions if granted DSP before 1/7/06

Permanently Disabled

Carer Payment• providing constant care to

someone with a severe disability or medical condition.

Carer Allowance may also be payable

• not means tested

Caring for Someone

Age Pension• Men 65 years• Women 63½• In Australia > 10 years

2009 Federal Budget : from 1 July 2017 Age Pension age will progressively raise to 67 years

Retired

• Eligibility depends on individual situation• (eg. Newstart / Age Pension)

• Amount paid depends on combined income and assets

• Includes Same-Sex couples living together

Examples• partner working - income may preclude entitlement• neither working - usually both claim Newstart• child(ren) under 6 - Newstart / Parenting Payment

Couples

Types Applies to ...Compensation Preclusions All pensions/ allowancesSeasonal Work Preclusion Period Except Age PensionIncome Maintenance Period Except Age & CarersOne Week Waiting Period Allowances onlyLiquid Assets Waiting Period Allowances only

Waiting Periods

Applies to• Seasonal work• Contract or sub-contract work• Casual or intermittent work

Where earnings were above AWOTE• Singles - $1,322.60 pw• Couples - $2,665.20 pw

Seasonal Work Preclusion

• Termination payments treated as income for the duration of the period they represent

• Includes• Annual leave• Long service leave• Redundancy payments

• Irrespective of what you do with the money

Redundancy payments assist financially while you look for

another job…You can’t get pensions and

allowances for the same period

Income Maintenance Period

George will receive 3 weeks annual leave and a package equivalent to 20 weeks of his pay…

George must serve a 23 week income maintenance period before he can be paid Newstart

He plans to use the money to repay a car loan, but before doing so he needs to set aside enough to cover

his regular living expenses for at least 23 weeks

Income Maintenance Period

SingleOne week for every $500 above $2,500

CouplesOne week for every $1,000 above $5000

•Maximum waiting period is 13 weeks•Starts from date of unemployment, sickness or study

Liquid Assets Waiting Period

Include• Cash • Money in bank, building

society and credit union accounts

Liquid Assets...

• Term deposits, shares, managed funds etc• Account based / allocated pension balance • Payments made to you by former employer

Liquid Assets do not include superannuation

Liquid Assets: 13 weeks

IMP (for example: 23 weeks)

Payment commences

Note - Age Pension and Carer Payment are not subject to these waiting periods.

Waiting Periods

Income and Assets

• Motor vehicles, boats, caravans etc• Household contents and personal effects• Bank accounts, investments, loans• Real estate• Farms, businesses• Antiques, collectables• Gifting

Assets include...

• Net market value• Motor vehicles, household contents etc

• Your estimate• Real estate

• Current market value • Australian Valuation Office

• Financial investments• Current value or account balance

Valuing Assets

• Principal home and up to 2ha of surrounding land on same title

• Funeral bonds, prepaid funerals• Special disability trusts• Super/Rollover investments

• Up until age pension age• Ministerial exemption

Paul is 65, and his wife Gill is 58.Superannuation in Gill's name is not included when assessing Paul's Age

Pension

Asset DO NOT include...

Assets above threshold• Allowances: no entitlement• Pensions: pension reduces $1.50 per fortnight per $1,000

* Thresholds are indexed annually on 1 July

Threshold* Cut-out point

SingleHomeowner $192,500 $696,250

Non-homeowner $332,000 $835,750

CoupleHomeowner $273,000 $1,032,500

Non-homeowner $412,500 $1,172,000

Asset Test Thresholds

• Gross earnings from employment • Including salary sacrificed income

• Overseas income• Income streams and superannuation

pensions• Rent from real estate• Farm or business income • Deemed income on financial

investments

Income includes...

Deeming

All financial investments are aggregated(cash, shares, bank accounts, investments, loans)

Single• first $45,400 is assessed at 3%• remainder is assessed at 4.5%

Couples• first $75,600 combined is assessed at 3% • remainder is assessed at 4.5%

… irrespective of the actual income received

Brian is single and has the following investments:Bank account $ 4,473 @ 1%$ 44 paTerm deposit $ 72,000 @ 5.5% $3,960 paShares $ 28,000 $1,120paTotal $104,473 $5,124 pa ($197 pf)

Brian's deemed incomeFirst $ 45,400 @ 3% $1,362 paRemaining $ 59,073 @ 4.5% $2,658 paTotal $104,473 $4,020 pa ($155pf)

Deeming - Example

• Single maximum rate is $489.70 pf provided assessed income is below $62pf

• Couples maximum rate is $442.00 pf each if assessed income is below $62pf each

• Higher rates may be payable• over 60 years old after 9 months• single with children

Allowance Rates

Single• Maximum Rate is $755.50pf• Income affects rate if above $152pf • No entitlement at $1,663.00pf ($43,238.00pa)

Couples• Maximum rate $569.50pf per person• Income affects rate if above $268pf combined• No entitlement at $2,546.00pf ($66,196.00pa)

Pension Rates

• Human Services does not know if your income or assets change

• Periodically update your:• Bank account details• Share portfolio • Asset values • Income details• Changes to super payments

Update your details with us...

• Register to view and update income and assets online

• Dependent children or students

• Paid to the parent or guardian

• Payment made by Human Services

• Fortnightly• Lump sum after

lodgment of tax return

Family Tax Benefit

Based on "adjusted taxable income"• Estimate for current financial year• Reconciled against income tax returns

While receiving pension or allowance • Income test free - maximum rate paid• Maintenance income test only

Family Tax Benefit

Revise estimate at any time• (eg as soon as you are aware of future redundancy)Redundancy and leave payments• Leave payments are taxable

• Include in estimate• Redundancy payment - tax free portion

• $8,806 + $4,404 per completed year of service*• Do not include in estimate

• Redundancy payment - taxable portion• Excess above tax free portion• Include in estimate

* Rates current for 2012/13

Family Tax Benefit - Estimates

• Redundancy and leave payments• Revise current estimate• May need to revise again as changes

occur • (eg. you get a new job)

136 150 orhumanservices.gov.au

Family Tax Benefit - Estimates

• Health Care Card• Allowances• Low income

Redundancy payment is averaged and included as income over the 12 months following payment

Concessions

• Pensioner Concession Card

• Commonwealth Seniors Health Card

• State Seniors Cards

Concessions

• Child Support / Maintenance

• Payroll deductions• Change in income• Contact CSA on 131 272

• Dependant children over 16 yrs old

• May qualify for Youth Allowance, or• Increased rate of Youth Allowance

Other Issues

Employment Services 132 850

Disability and Carers 132 717

Retirement 132 300

Family Assistance 136 150

Multilingual Service 131 202

Contacting us

Telephone or web self serviceRegisterCheck your details• View income and assets• Payment details• Make claims online • Request cards/statements• Many others

humanservices.gov.au

Online Services

FIS presents seminars which may interest you

Topics include:•Investing with Safety•Creating Wealth•Superannuation•Protecting Your Assets

For further information, check out:

humanservices.gov.au/fisthen click on ‘Seminars’

FIS Seminars

To assist employees who are

• made redundant due to bankruptcy or liquidation of their employer, and

• owed unpaid wages, leave or redundancy payments

General Employee Entitlements and Redundancy

Scheme

workplace.gov.au1300 135 040

GEERS