Navigating the world of family support payments can be a bit overwhelming, especially when you’re juggling the many responsibilities of raising children. That's where the Family Tax Benefit (FTB) comes in. This valuable support from the Australian Government is designed to help families like yours with the costs associated with raising kids. 😊
Whether you’re a single parent or part of a family with one primary income, FTB helps ease the financial burden. With two main components - FTB Part A and FTB Part B - this benefit is tailored to different family situations and needs.
In this guide, we’ll walk you through everything you need to know about FTB, from understanding what it is and who can receive it, to how it connects with your tax return. We’ll cover the application process, how to avoid common pitfalls, and the importance of keeping your information up to date. By the end, you’ll have a clear picture of how FTB can support your family and how it ties into your tax obligations. 🙌
So, let’s dive into the details and ensure you’re fully informed about this important benefit! ✨
What is the Family Tax Benefit (FTB)?
The Family Tax Benefit (FTB) is a 2-part payment for eligible families to help with the cost of raising children.
The Family Tax Benefit is made up of 2 parts:
Part A — a payment made per child, depending on your family's circumstances.
Part B — a payment made per family, to give extra help to families that need it.
Who Can Get FTB?
To be eligible for Family Tax Benefit Part A, you must:
care for an eligible dependent child,
meet the residence rules; and,
meet an income test.
Eligible Child Criteria
To be eligible, your child must be:
aged 0 to 15 years; or,
aged 16 to 19 years and be either in full-time secondary study, have an acceptable adjusted study load, or are exempt from study requirements.
They also need to be in your care for at least 35% of the time and not be receiving other benefits, such as Youth Allowance.
Residence rules
You must be living in Australia and meet one of the following criteria:
be an Australian citizen
hold a permanent visa
hold a Special Category visa
hold a temporary visa, such as a partner provisional or temporary protection visa
Your child/ren must also meet these rules and be living with you.
The payments might be affected if you're living outside Australia. Also, new arrivals to Australia may have to wait one year before they can receive Family Tax Benefit Part A.
Income test
The amount of FTB you get will depend on your family income. The current thresholds are:
For FTB A:
The threshold amount is $115,997*; however, payments received are reduced by 20 cents for each dollar of income over $65,189*.
For FTB B:
The threshold amount is $117,194*.
You must lodge a tax return at the end of the financial year. This needs to be completed within the 12 months following the end of the financial year. If you are not required to lodge a tax return you must notify Services Australia.
Please note that any child support you receive will affect the payment.
Other requirements
To receive the payment, your child must also meet early childhood immunisation requirements. They also need to have a health check if they are turning 4 years old. We suggest checking your eligibility by visiting the Services Australia website (https://www.servicesaustralia.gov.au/family-tax-benefit-part-eligibility).
*Amounts correct as at 30 September 2024.
How much is the Family Tax Benefit?
➡️ FTB Part A
The base rate for FTB Part A is $71.26* for each child per fortnight. The base rate is not the minimum for FTB Part A; you may receive less depending on your income.
The maximum rate for FTB Part A depends on the age of the child you get it for.
The maximum rate for each child per fortnight is:
$222.04* for a child 0 to 12 years
$288.82* for a child 13 to 15 years
$288.82* for a child 16 to 19 years who meets the study requirements
$71.26* for a child 0 to 19 years in an approved care organisation.
FTB Part A is based on your income, how many kids you’re caring for, and their ages. You can choose to receive payments either fortnightly or as a lump sum at the end of the financial year. After Services Australia balances your family assistance payments, a supplement might also be added.
Eligibility depends on a few factors, including the number of children, shared care arrangements, income, and the number of days you’re eligible. Plus, if you’re getting FTB Part A, you might also qualify for extra benefits, like the Newborn Supplement, Energy Supplement, Multiple Birth Allowance, Rent Assistance, or even a Health Care Card.
➡️ FTB Part B
The maximum rate for FTB Part B depends on the age of your youngest child.
The maximum rate per family each fortnight is:
$188.86* when the youngest child is 0 to 4 years of age
$131.74* when the youngest child is 5 to 18 years of age.
The amount you receive for FTB Part B depends on your income and the age of your youngest child. You can choose to receive payments either fortnightly or as a lump sum at the end of the financial year. Plus, an annual supplement may be available after the end of the financial year, subject to income and eligibility criteria, once you and your partner (if applicable) lodge your tax returns or inform Services Australia that you don’t need to lodge.
You might also be eligible for the Energy Supplement and the Single Income Family Supplement.
*Amounts correct as at 30 September 2024.
How to Apply for FTB
It’s easy to apply for FTB online. Here’s a quick guide:
Set up a myGov account if you don’t have one yet.
Link your Centrelink account to myGov.
Log in and make a claim for FTB through myGov.
Provide income details and family info: You’ll need to give an estimate of your family’s income and details about your children, like their ages and school status.
Submit supporting documents if asked.
Wait for assessment: Services Australia will review your application and let you know if you’re approved.
Once approved, you can choose to receive payments fortnightly or as an annual lump sum.
FTB and Your Tax Return: How They’re Linked
Although FTB is not taxed, it does connect with your tax return in a few important ways:
Income Estimates: When applying for FTB, you provide an income estimate for the financial year. Services Australia checks this estimate against your actual income at tax time.
Reconciliation: If your actual income exceeds your estimate, you may need to repay some FTB. Conversely, if you earned less, you might receive a top-up payment for underpayment.
Lodging a Tax Return: Both you and your partner (if applicable) must lodge your tax returns for Centrelink to finalise your FTB payments. If you don’t need to lodge, submit a non-lodgement advice form to inform them.
Avoid Overpayment or Debt
To avoid a situation where you need to repay some of your FTB:
Keep your income estimates up to date throughout the year if your situation changes.
If you’re unsure of your income, you can opt for the lump-sum payment at the end of the financial year, once your actual income is known.
What Happens After You Lodge Your Tax Return?
Once your tax return is lodged, Services Australia will:
Check your actual income against the estimate you gave when applying for FTB.
Adjust your FTB payments if needed. If you were paid too much, you’ll have to repay the extra amount. If you were underpaid, you’ll get a top-up.
Don’t worry if you receive a lump-sum tax refund - this won’t affect your FTB, but it’s important to make sure your income estimate is as accurate as possible.
Common Questions About FTB and Tax Returns
Do I need to include FTB in my tax return?
No, FTB is not taxable, so it doesn’t need to be included as income on your tax return.
What if I don’t need to lodge a tax return?
If you or your partner don’t need to lodge a tax return, just let Services Australia know by submitting a non-lodgement advice form. This helps them finalise your FTB payments.
Final Tips
When it comes to Australia’s Family Tax Benefits (FTB), it’s a good idea to keep an eye on your income estimate throughout the year, especially if your circumstances change. Regularly checking your estimate can help ensure your FTB payments match your actual income.
Don’t forget that both you and your partner need to lodge your tax returns on time. If you don’t need to lodge, just submit a non-lodgement advice form to avoid any delays in your FTB payments. If you're unsure about what you might be eligible for, hop on over to the Services Australia website and use the FTB estimator. It’s a handy tool that gives you a better idea of the benefits you could qualify for, helping you plan ahead and make the most of your entitlements! 🤩
Now that we’ve gone through it, I hope you find this info helpful in understanding what you’re eligible for with the Family Tax Benefit (FBT). By knowing how to apply, you can make the most of this benefit and ease some financial pressures. Remember, every little bit helps! Your family's well-being is what matters most! 💙