The family tax benefit scheme of the Australian government aims to support low- and middle-income families who find it challenging to raise their children due to financial constraints.
There are two parts to the family tax benefit scheme, as follows:
- Part A: The payment is made for the child depending on the family’s financial condition.
- Part B: The payment is made to families with single parents or with one earning member.
Family Tax Benefit Part A
This assistance is given to parents, guardians, or grandparents caring for the children. There are certain eligibility requirements for receiving this financial help, which are as follows:
Child Criteria
- The dependent child is aged between 0 and 15 years
- The dependent child is above 16 but below 20 years old and has a 12th-grade qualification or is a student.
- Full-time students aged between 21 and 24 years who are dependent
- Children who need care for at least 35% of the time.
Income test
The amount granted depends on the family’s income. The person receiving the payment must file a tax return for the previous financial year as per the timeline. The tax accountant services in Melbourne keep you aware of the income criteria to help you achieve the maximum financial benefits under this program.
Residential Criteria
The child must satisfy the following residential eligibility criteria or must be living with the parents who satisfy the requirements as follows:
- Must be an Australian citizen.
- Possesses a permanent visa
- Holds a special category visa
- Has a temporary visa, such as a provisional protection visa
Families arriving in Australia in recent times need to wait for one year to get the family tax benefit. The amount granted under Part A of the family tax benefit depends on the following:
- The family income
- The ages of dependent children
- The number of dependent children
Family Tax Benefit Part B
This is additional financial support for individuals who are not parents but are taking care of children. This assistance applies to single parents and families with only one member earning. It considers the situations where the caregiver can’t work and earn due to the child’s age.
The eligibility requirements for family tax befitting Part B are as follows:
Child Criteria
Persons meeting the following criteria can avail of family tax benefits under Part B.
- I am looking after a dependent kid who is under 13 years old and belongs to a family with a single income source.
- A single parent or grandparent of a child below 18 years of age.
- Children between 16 and 18 years old must meet full-time secondary school study requirements.
Residential Status
The child must satisfy the following residential eligibility criteria or must be living with the parents who satisfy the requirements as follows:
- Must be an Australian citizen.
- Possesses a permanent visa
- Holds a special category visa
- Has a temporary visa, such as a provisional protection visa
Income Criteria
For single parents or grandparents, the annual income should be less than $117,194 to be eligible to receive payment under Part B of the family tax benefit. Partnered parents are eligible under Part B of the family tax benefit if the age of the youngest child is less than 13 years. The annual income of the primary earning member should be less than $117,194, and the annual income of the secondary earning member should be less than $6,789.
The maximum amount given under Part B depends on the age of the youngest child. A maximum of $188.86 is granted when the youngest child is 0 to 4 years old, and up to $131.74 is given when the youngest child is 5 to 18.
When Does the Family Tax Benefit Stop?
Families can avail themselves of the advantages of family tax benefits only up to the time when the child is continuing the 12th grade or has equivalent qualifications. It is no longer available when the children complete their studies or reach the age of 19.
Ending Note
The Family Tax Benefit allows several families to raise their children while receiving financial support based on certain criteria. Families often require the assistance of a reliable and experienced tax accountant in Melbourne who can guide them successfully and effectively utilize the benefits of this scheme.
At MaxMargin Accountants, we provide our clients with complete Business Advisory, Taxation & Accounting services. As a tax accountant, we help with the Family Tax Benefit by determining eligibility, assisting with application completion and submission, advising on how to structure finances to maximise the benefit, providing ongoing support to ensure continued eligibility and compliance, and integrating the Family Tax Benefit into your overall tax planning strategy.
Contact us to ensure you make the most of the Family Tax Benefit and handle all related tax matters efficiently.
