Everything you need to know about Family Tax Benefits

Family Tax benefits are a form of welfare payment divided into two categories A and B, both of which aim to assist parents and carers, with the costs of supporting a family and in particular those costs associated with caring for children.

But how do you know if you are eligible for either category A or B payments and if so how much are you eligible for?

Category A Family Tax benefits are paid based on the age and education status of each child in the family. To be eligible for Category A benefits a family must care for a dependent child who is aged 0-15 or 16-19 and undertaking full time education. Furthermore the family must pass an income test where their total taxable income must be below $50,151 in order to receive the full fortnightly payment amount of $176.82 for each child aged 0-12 and $230.02 for each child aged 13-19. However if the family fails this income test they may still eligible but their payments are reduced by 20 cents for every dollar of income over the threshold down to a minimum payment of $56.70 per child.

On the other hand Category B Family Tax benefits are paid only to families with one primary source of income. To be eligible for Category B payments the family must be caring for any child under the age of 16 or under the age of 18 assuming they are undertaking full time education. Also you must pass an income test where for a single income family the maximum taxable income earned must be under $150,000 to receive the full Category B fortnightly payment of $150.36 for a child under 5 and $105.00 for each child between 5-18 . For a 2 parent family the primary income earner must also be below $150,000 in taxable income and the secondary income earner must also be below the $5329 threshold or else the payments will be reduced by 20 cents for each dollar of income over this limit until the payment reaches 0.

Family Tax Benefits

Category A (A)

Category B (B)

Paid based on age and education status of each individual child in family

To be eligible for Category A:

- A family must care for a dependent child aged 0-15/16-19.
- Child is undertaking full time education.
- Parents must pass an income test; total tax income <$50,151.
- Eligibility enables them to receive full amount fortnightly per child.
- $176.82  if aged 0-12.
- $230.02 if aged 13-19.
- Failure in passing income test still enables them to be eligible for tax benefits but payments are reduced by 20c/dollar of income; minimum payment being $56.70/per child.

Paid to families with one primary source of income.

In order to be eligible for Category B:

- Family must be caring for a child under the age of 16 or 18.
- Child is undertaking full time education.
- Parents must pass income test; maximum tax income earned must be <$150,000.
- Eligibility enables them to receive full amount fortnightly per child.
- $150.36 if aged below 5.
- $105.00 if aged between 5-18.
- In a 2 parent family, primary income must be <$150,000 in taxable income. Secondary income earner must be <$5329.
- Otherwise, payments are reduced by 20c/dollar of income over the limit till payment reaches 0.

If you think you may be eligible for either Category A or B Family tax benefits it may be wise to visit centrelink and make an inquiry or simply consult a financial planner

Comments are closed.