Shared care and eligibility for Family Tax Benefit (FTB)
The parent of a 'regular care' child will not get 'normal' FTB, but will still be eligible for Rent Assistance and certain other concessions.
From 1 July 2008, a parent who has care of a child for less than 35 per cent of the time will not be eligible for the child related components of FTB.
Instead of receiving FTB, a parent who has care of a child between 14 per cent to less than 35 per cent of the time will have the costs of the child taken into account in working out how much child support the parent will pay. This level of care is called regular care and will be counted as meeting 24 per cent of the costs of raising the child for child support purposes. For most payers, this will reduce the amount of child support paid.
A parent with regular care of a child will continue to be eligible for the rent assistance component of FTB Part A and other government benefits, such as:
- Child Care Benefit and Child Care Tax Rebate - if you pay child care fees to an approved child care service provider or a registered carer, you will still be able to receive Child Care Benefit
- A Health Care Card (if income does not exceed the income threshold for the maximum rate of FTB Part A, which is $41,318 in 2007-2008)
- The lower threshold for the Medicare safety net ($529.30 in 2008) if income is below the income cut-out amount for FTB Part A ($93,054.56 in 2007-08 for one child under 18 in 24 per cent care)
- Additional Remote Area Allowance paid with social security income support payments (e.g. Newstart Allowance)
An FTB shared care percentage will be used to work out a parent's FTB Part A rate. The FTB shared care percentage will be worked out in the following way:
| No. of nights care (annually) | Percentage of care | FTB shared care percentage |
|---|---|---|
| 0 to 51 | 0% to less than 14% | Not eligible for FTB |
| 52 to 127 | 14% to less than 35% | Not eligible for child related components of FTB. Eligible for rent assistance component and other government benefits |
| 128 to 175 | 35% to less than 48% | 25% plus 2% for each percentage point over 35% |
| Example: You have care of your child for 40% of the time, so your FTB shared care percentage is 35% | ||
| 176 to 189 | 48% to 52% | 50% |
| 190 to 237 | More than 52% to 65% | 51% plus 2% for each percentage point over 53% |
| Example: You have care of your child for 60% of the time, so your FTB shared care percentage is 65% | ||
| 238 to 365 | More than 65% to 100% | 100% |
A parent who has care of a child for more than 65 per cent of the time will be eligible for 100 per cent of FTB for the child.
The new arrangements follow the recommendations made by the Ministerial Taskforce on Child Support. The Taskforce undertook a detailed examination of the costs of raising children and how this is affected where a child spends time with each separated parent. The new arrangements ensure there is an integrated approach for the child support and Family Tax Benefit systems, and better reflect the costs of raising the child for each parent.
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