The Australian Government will improve the process of income estimation to help families start the income year with a more accurate income estimate for their family assistance payments.
When the Family Assistance Office contacts a family prior to the start of each income year, the family will be advised of a default estimate that will be used to calculate their fortnightly payments. This default estimate will be calculated by increasing the family's existing estimate in line with movements in Average Weekly Earnings (AWE). Families will be invited to provide an alternative estimate if they think the default estimate does not reflect their circumstances.
To ensure the default estimate remains in line with the family's actual income, when the actual income for the previous year becomes known (ie they lodge their income tax returns) the default estimate will be compared with the actual income (increased by movements in AWE), with the higher value used as the default estimate. Families will be advised of any change and have the opportunity to provide an alternative estimate.
Accurate income estimation is important, because families who choose to receive their Family Tax Benefit through fortnightly payments have their provisional entitlement based on their estimated income. After the end of the income year the estimated income is compared with the family's actual income. Families who have overestimated their income during the year and have been underpaid receive a 'top up' payment at the end of the year. On the other hand, families who have underestimated their income and have been overpaid are required to pay back the amount they were overpaid during the year.
1 July 2006.
Total Government Funding
$18.6 million over four years.