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Schedule 1—Carer allowance

Schedule 1 Carer allowance

   

Social Security Act 1991

1  Section 10A (heading)

Repeal the heading, substitute:

10A   Definitions for carer allowance and seniors health card provisions

2  Subsection 10A(2)

Omit “Part 3.9 and Part 3.12A”, substitute “Parts 2.19, 3.9 and 3.12A”.

3  At the end of subsection 953(1)

Add:

             ; and (g)  the person satisfies the carer allowance income test under section 957A.

4  After paragraph 953(2)(f)

Insert:

             ; and (g)  the person satisfies the carer allowance income test under section 957A.

5  After paragraph 954(1)(f)

Insert:

             ; and (g)  the person satisfies the carer allowance income test under section 957A.

6  After paragraph 954A(1)(e)

Insert:

                    (ea)  the person satisfies the carer allowance income test under section 957A; and

7  At the end of Subdivision A of Division 2 of Part 2.19

Add:

957A   Carer allowance income test

             (1)  This is how to work out whether a person satisfies the carer allowance income test on a day (the test day ).

Method statement

Step 1.   Work out the amount of the person’s adjusted taxable income for the reference tax year.

                   Note 1:          Section 957B deals with how to work out adjusted taxable income.

                   Note 2:          For reference tax year see subsections (2) and (3).

Step 2.   If, on the test day, the person is a member of a couple, work out the amount of the person’s partner’s adjusted taxable income for the reference tax year applicable under step 1.

                   Note 1:          Section 957B deals with how to work out adjusted taxable income.

                   Note 2:          For reference tax year see subsections (2) and (3).

Step 3.   If, on the test day, the person is not a member of a couple, the person has reached the minimum age mentioned in section 301-10 of the Income Tax Assessment Act 1997 and the person has at least one long-term financial asset, work out the person’s deemed income amount under subsection 957D(1).

                   Note:             For long-term financial asset see subsection (5).

Step 4.   If, on the test day, the person is a member of a couple and the person, or the person’s partner, or both, have reached the minimum age mentioned in section 301-10 of the Income Tax Assessment Act 1997 and have at least one long-term financial asset, work out the person’s deemed income amount under subsection 957D(2).

                   Note:             For long-term financial asset see subsection (5).

Step 5.   Work out the sum of the amounts at steps 1, 2, 3 and 4 (as applicable).

Step 6.   The person satisfies the carer allowance income test if the amount at step 5 is less than $250,000.

Reference tax year

             (2)  For the purposes of this section, a person’s reference tax year is:

                     (a)  if the person has received a notice of assessment of the person’s taxable income for the base tax year—the base tax year; or

                     (b)  otherwise—the tax year immediately preceding the base tax year.

Note:          For base tax year see subsection (4).

             (3)  However, if the person has informed the Secretary in writing that the person wishes to have the person’s qualification for carer allowance determined by reference to the person’s adjusted taxable income for the tax year (the current tax year ) in which the test day occurred, the person’s reference tax year is the current tax year.

             (4)  The base tax year is the tax year immediately preceding the tax year in which the test day occurred.

Note:          For tax year see subsection 23(1).

Long-term financial asset

             (5)  For the purposes of this Subdivision, a long-term financial asset is:

                     (a)  a financial investment within the meaning of paragraph (i) of the definition of financial investment in subsection 9(1), where the asset-tested income stream (long term) arises under a complying superannuation plan (within the meaning of the Income Tax Assessment Act 1997 ) that is not a constitutionally protected fund (within the meaning of that Act); or

                     (b)  a financial investment within the meaning of paragraph (j) of the definition of financial investment in subsection 9(1).

957B   Adjusted taxable income

             (1)  For the purposes of this Subdivision, a person’s adjusted taxable income for a particular tax year is the sum of the following amounts (each of which is an income component ):

                     (a)  the person’s taxable income for that year, disregarding the person’s assessable FHSS released amount (within the meaning of the Income Tax Assessment Act 1997 ) for that year;

                     (b)  the person’s fringe benefits value for that year;

                     (c)  the person’s target foreign income for that year;

                     (d)  the person’s total net investment loss for that year;

                     (e)  the person’s tax free pensions or benefits for that year;

                      (f)  the person’s reportable superannuation contributions for that year;

less the amount of the person’s deductible child maintenance expenditure (the deductible component ) for that year.

Note:          For tax year see subsection 23(1).

Taxable income

             (2)  For the purposes of this section, a person’s taxable income for a particular tax year is:

                     (a)  the person’s assessed taxable income for that year; or

                     (b)  if the person does not have an assessed taxable income for that year—the person’s accepted estimate of taxable income for that year.

Note:          For accepted estimate see section 957C.

             (3)  For the purposes of this section, a person’s assessed taxable income for a particular tax year at a particular time is the most recent of:

                     (a)  if, at that time, the Commissioner of Taxation has made an assessment or an amended assessment of that taxable income—that taxable income according to the assessment or amended assessment; or

                     (b)  if, at that time, a tribunal has amended an assessment or an amended assessment made by the Commissioner—that taxable income according to the amendment made by the tribunal; or

                     (c)  if, at that time, a court has amended an assessment or an amended assessment made by the Commissioner or an amended assessment made by a tribunal—that taxable income according to the amendment made by the court.

Fringe benefits value

             (4)  For the purposes of this section, a person’s fringe benefits value for a particular tax year is the person’s accepted estimate of the amount by which the total of the assessable fringe benefits received or to be received by the person in the tax year exceeds $1,000.

Note 1:       For assessable fringe benefit see subsection 10A(2) and Part 3.12A.

Note 2:       For accepted estimate see section 957C.

Target foreign income

             (5)  For the purposes of this section, a person’s target foreign income for a particular tax year is the person’s accepted estimate of the amount of the person’s target foreign income for that year.

Note 1:       For target foreign income see subsection 10A(2).

Note 2:       For accepted estimate see section 957C.

Total net investment loss

             (6)  For the purposes of this section, a person’s total net investment loss for a particular tax year is the person’s accepted estimate of the amount of the person’s total net investment loss (within the meaning of the Income Tax Assessment Act 1997 ) for that year.

Note:          For accepted estimate see section 957C.

Tax free pensions or benefits

             (7)  For the purposes of this section, a person’s tax free pensions or benefits for a particular tax year is the person’s accepted estimate of the total of the person’s tax free pensions or benefits (worked out under clause 7 of Schedule 3 to the A New Tax System (Family Assistance) Act 1999 ) for that year.

Note:          For accepted estimate see section 957C.

Reportable superannuation contributions

             (8)  For the purposes of this section, a person’s reportable superannuation contributions for a particular tax year is the person’s accepted estimate of the amount of the person’s reportable superannuation contributions (within the meaning of the Income Tax Assessment Act 1997 ) for that year.

Note:          For accepted estimate see section 957C.

Deductible child maintenance expenditure

             (9)  For the purposes of this section, a person’s deductible child maintenance expenditure for a particular tax year is the person’s accepted estimate of the amount worked out under subclause 8(1) of Schedule 3 to the A New Tax System (Family Assistance) Act 1999 for the person for that year.

Note:          For accepted estimate see section 957C.

957C   Accepted estimates

             (1)  For the purposes of section 957B, a person’s accepted estimate of an income component, or the deductible component, for a particular tax year is that income component, or deductible component, according to the most recent notice given by the person to the Secretary under subsection (2) and accepted by the Secretary for the purposes of this section.

Note:          For income component and deductible component see subsection 957B(1).

             (2)  A person may give the Secretary a notice, in a form approved by the Secretary, setting out the person’s estimate of an income component, or the deductible component, of the person for a tax year.

             (3)  The notice is to contain, or be accompanied by, such information as is required by the form to be contained in it or to accompany it, as the case may be.

             (4)  The Secretary is to accept a notice only if the Secretary is satisfied that the estimate is reasonable.

957D   Income from long-term financial assets

Person is not a member of a couple

             (1)  This is how to work out the person’s deemed income amount under this subsection:

Method statement

Step 1.   Work out the total value of all of the person’s long-term financial assets on the test day.

                   Note:             For long-term financial asset see subsection 957A(5).

Step 2.   Work out under section 1076 the amount of ordinary income the person would be taken to receive per year on the financial assets:

               (a)     on the assumption that the only financial assets of the person were the financial assets referred to in step 1; and

              (b)     on the assumption that the total value of the person’s financial assets were the amount at step 1.

Step 3.   The result at step 2 is the person’s deemed income amount .

Person is a member of a couple

             (2)  This is how to work out the person’s deemed income amount under this subsection:

Method statement

Step 1.   If, on the test day, the person has reached the minimum age mentioned in section 301-10 of the Income Tax Assessment Act 1997 , work out the total value of all of the person’s long-term financial assets on the test day.

                   Note:             For long-term financial asset see subsection 957A(5).

Step 2.   If, on the test day, the person’s partner has reached the minimum age mentioned in section 301-10 of the Income Tax Assessment Act 1997 , work out the total value of all of the person’s partner’s long-term financial assets on the test day.

Step 3.   Work out under section 1077 the amount of ordinary income the couple would be taken to receive per year on the financial assets:

               (a)     on the assumption that section 1077 applied to the person and the person’s partner; and

              (b)     on the assumption that the only financial assets of the person and the person’s partner were the financial assets referred to in steps 1 and 2 (as applicable); and

               (c)     on the assumption that the total value of the couple’s financial assets were the sum of the amounts at steps 1 and 2 (as applicable).

Step 4.   The result at step 3 is the person’s deemed income amount .

8  Part 3.12A (heading)

Repeal the heading, substitute:

Part 3.12A Provisions for carer allowance and seniors health card income test

9  Subsection 1157A(1)

After “purposes of the”, insert “carer allowance income test and the”.

10  Application provision

The amendments made by this Schedule apply in relation to working out a person’s qualification for carer allowance for a day that is on or after the commencement of this item.